Infrustructure; key for business growth

[vexaaa]

Tanzania efforts to attract more investment will bear fruits only if the government chooses to address insecurity, physical infrastructures and ensure stable power supply.

The chairman of the Chinese Business Chamber, Mr Janson Huang, said in March that Tanzania is losing billions of Dollars from Chinese investment due to poor infrastructures.

He said that Tanzania has many potentials which when well utilized can lead to great economic development. But this cannot be achieved because of concern about insecurity among investors from the Asian economic giant coupled with the poor infrastructure, especially roads.

He told the CEOs roundtable in the city in March that they had noted investment potentials in mining, agriculture, energy and tourism which could attract more Chinese investors. But, he hastened to say, many investors were still skeptical because they were not guaranteed of security and infrastructure which would facilitate quick trading.


Recently BEST-AC commissioned a survey titled ‘Business leader perceptions of the investment climate in Tanzania-2011’ which revealed that unreliable power, Poor roads, corruption and lack of enough water are the major factors that make it difficult for businesses to get on with running and growing.

Experts say if these hindrances are not dealt with many Tanzanians will remain in extreme poverty.

 

[Bwana Paulo]

There is no doubt about the truth in what you say. Infrastructure, power, water, a secure legal environment and such are all "bottlenecks" to foreign direct investment. The United States built it's infrastructure initially over a period of more than a hundred years, and much of the money came from Europe, primarily because of wars in Europe in the 19th Century. My point is that these investments in infrastructure take time.

I am particularly puzzled about why Tanzania has taken such a casual attitude towards it's railroads, both the TAZARA and the original, colonial built railway. Anyone who has studied transport costs will confirm that the cost of rail transport is many times cheaper than road...by a factor of 3 or 4 to 1. No serious industrial development will be possible without properly functioning railways.

But railways are heavy investments but they pay off in economical transport of bulk materials like copper, coal, iron ore or iron, grain, logs and lumber and cement, and so on. Tanzania must find a way of getting their existing railroad functioning efficiently as well as extending them. I remember in 1967 being able to ride comfortably from DSM to Moshi with no problem.

Last December, I went to Mbeya to be able to ride the TAZARA to Dar from Mbeya, and was told when my Tanzanian friends brought me to the station that no first or second class cars were available that day! They strongly advised me any my friends not to book the third class ticket...I was very disappointed as I wanted to see the Kilombero Valley and the Selous Game Reserve. I served for two years as a Peace Corps Volunteer in Sonjo, on the road to Ifakara in the Kilombero Valley(1966-1968) working with sugar cane farmers, and wanted very much to pass through the area again by train! Every time I would tell someone that I was going to travel to Mbeya by road to take the TAZARA train back to Dar they would look at me as if I were a bit crazy...

So many people would benefit from proper functioning railways; many businesses would be possible... creating employment for many.

Tanzania is well positioned to be a transport corridor for Rwanda, Burundi, Zambia, DRC, Malawi and even Uganda. This is a big business opportunity that is being lost!