Tanzania: PM Asks Public Institutions to Get Profitable, Boost State Coffers
Posted on :Thursday , 2nd March 2017
Prime Minister Kassim Majaliwa has instructed parastatal organizations to form partnerships among themselves and with the private sector to implement key projects towards realization of the industry-led economy, outlined in the Second Five-Year Development Plan (FYDP II).
Funds amounting to 107trl/- will be required to undertake the ambitious plan spanning 2016/17 - 2020/21, with the theme; "Nurturing Industrialisation for Economic Transformation and Human Development.
" Premier Majaliwa instructed heads of the organizations to be innovative and utilize efficiently the resources they have to add onto their profits which will eventually boost treasury coffers.
Mr Majaliwa was speaking at a one-day meeting with heads of public institutions, organized by the Uongozi Institute and the Office of the Treasury Registrar held in the State House auditorium, in Dar es Salaam yesterday.
He cited the Ethiopian Airlines, fully owned by the Ethiopian government, which made a staggering profit of 273 million US dollars (about 546bn/-) in 2015/2016 whereas all public organisations in Tanzania dished out only 422bn/- during the same period.
"They (Ethiopian Airlines) embark on innovation and proper utilization of resources they have. It is high time our corporations did the same," he stated.
The PM pointed to decreasing credit facilities in the global markets, compelling developing countries to raise funds for development locally. "Developed countries contributing funds to the African Development Fund (ADF) by African Development Bank (AfDB) have indicated that they will cut funding from 6.802 billion US dollars to 5.817 billion US dollars, representing a decrease of 16.9 per cent," he observed.
He further stated that efforts to convince the donating countries to boost the funding are ongoing but there are no guarantees of that happening.
"It is thus obvious that the reduction will impact negatively on recipient countries, Tanzania included since it receives funds from the portfolio. Given the infancy of the private sector in Tanzania, it is high time parastatal organizations partnered with each other and with private sector players to implement projects earmarked in the plan," he stressed.
Priority projects in FYDP II include setting up of factories as well as facilitating infrastructure to support industrialization namely construction of railway networks, ports, roads as well as investments in energy, water, and communication.
Mr Majaliwa pointed out that the Mwalimu Nyerere Bridge linking Kigamboni creek and Dar es Salaam central business district, University of Dodoma (UDOM) and the National Assembly building in Dodoma as among typical projects undertaken jointly by parastatal organizations.
The Premier on the other hand showered praises on the management of National Housing Corporation (NHC) for turning the loss-making company to a profitable one with remarkable projects countrywide.
He criticized some executives at public organizations for operating just for the sake of existing without profits to the government. "It is like a hen laying eggs which do not hatch, we need the eggs to be hatched to get more chicks," he emphasized.
There are 264 governmentowned institutions, he noted, 65 of them commercially driven corporations, 187 for service provision in addition to 12 regulators. Of the 65 commercially driven entities, eight of them still operate on government subsidies while 57 operate profitably.
Meanwhile, the Premier said in Dar es Salaam on Monday that he was closely monitoring auctioning of minerals in the country following reports of irregularities at the public sale.
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