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Interview with Tanzanian media mogul Reginald Mengi
One of Tanzania’s richest businesspeople sees hope for end to graft
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Tanzania’s new president promises to shake things up July 13, 2016
Reginald Mengi © Sam Vox
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July 13, 2016
by: John Aglionby
The personal website of Reginald Mengi — the tycoon who, over 30 years, has accumulated interests in print and broadcast media, manufacturing, soft drinks, mining and technology — suggests Tanzania is and always has been an open economy where it is easy to do business.
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But two hours with the softly spoken businessman, who is one of the country’s richest people, reveals a very different picture. Despite Tanzania’s economy growing at more than 7 per cent a year, Mr Mengi says widespread graft has left it resembling a piece of fabric that is riddled by holes.
“You touch here there’s a hole, you touch here there’s a hole,” he says prodding the tablecloth over lunch in a Dar es Salaam hotel. “You touch this ministry there’s a hole, you touch this functionary … everywhere is full of holes.” Mr Mengi says he has lost out on at least two big deals due to corruption.
It is not just corruption that has hampered Tanzania’s economic growth; it was ruled for decades by socialists who regularly stifled entrepreneurialism, Mr Mengi says.
The businessman recounts how in the 1980s there were widespread shortages due to the government promoting policies that favoured domestic produce over imports. “People would queue for anything and things were very very tough,” he says.
It was this scarcity that prompted Mr Mengi — then working at UK accountancy Coopers & Lybrand, now PwC — to go into business in the 1980s, assembling ballpoint pens. “At that time it was very difficult to import ready-made goods. Fortunately the system allowed the importation of components or knocked-down goods that you could assemble locally.”
Mr Mengi eventually acquired the financing and the components and navigated the bureaucracy to launch his business. He describes how he made money by producing shoe polish out of charcoal during the shortages.
But he says that decades of socialism have had a significant impact on society. “People don’t see opportunities in things,” he says. “We have so much in Tanzania people need help to see the opportunities which are there.”
The economy did open up in the late 1990s under President Benjamin Mkapa. But Mr Mengi says the policies ushered in an era of crony capitalism.
The government is trying to reassure foreign investors it wants their business
By last year the situation “had reached tipping point”, according to Mr Mengi, and he is relieved that the new president, John Magufuli, has prioritised fighting corruption.
Mr Mengi acknowledges the president has yet to articulate his economic vision, but he understands why this has taken time.
“If someone has a heart attack what do you do? Poop poop poop, you try and revive them. You don’t think, ‘Shall I give them a Panadol?’” he says while miming using a defibrillator. Despite painting a gloomy picture, Mr Mengi says businesspeople should not be too downcast about the current “bad times”.
“People with guts will make a lot of money in bad times, a lot of money,” he insists. “Beauty is in the eye of the beholder. You can say this is good times or bad times depending on the beholder.”
Copyright The Financial Times Limited 2016. All rights reserved. You may share using our article tools. Please don't cut articles from FT.com and redistribute by email or post to the web.
Interview with Tanzanian media mogul Reginald Mengi - FT.com
One of Tanzania’s richest businesspeople sees hope for end to graft
Read next:
Tanzania’s new president promises to shake things up July 13, 2016
Reginald Mengi © Sam Vox
Print this page
0
July 13, 2016
by: John Aglionby
The personal website of Reginald Mengi — the tycoon who, over 30 years, has accumulated interests in print and broadcast media, manufacturing, soft drinks, mining and technology — suggests Tanzania is and always has been an open economy where it is easy to do business.
Sample the FT's top stories for a week
Receive a free daily email briefing containing the 3 top stories from one of our top news themes.
Select the topic you are interested in:
Email address:
Invalid email
By signing up you confirm that you have read and agree to the terms and conditions, cookie policy and privacy policy.
Unsubscribe at any time. Free stories only last for 1 week.
But two hours with the softly spoken businessman, who is one of the country’s richest people, reveals a very different picture. Despite Tanzania’s economy growing at more than 7 per cent a year, Mr Mengi says widespread graft has left it resembling a piece of fabric that is riddled by holes.
“You touch here there’s a hole, you touch here there’s a hole,” he says prodding the tablecloth over lunch in a Dar es Salaam hotel. “You touch this ministry there’s a hole, you touch this functionary … everywhere is full of holes.” Mr Mengi says he has lost out on at least two big deals due to corruption.
It is not just corruption that has hampered Tanzania’s economic growth; it was ruled for decades by socialists who regularly stifled entrepreneurialism, Mr Mengi says.
The businessman recounts how in the 1980s there were widespread shortages due to the government promoting policies that favoured domestic produce over imports. “People would queue for anything and things were very very tough,” he says.
It was this scarcity that prompted Mr Mengi — then working at UK accountancy Coopers & Lybrand, now PwC — to go into business in the 1980s, assembling ballpoint pens. “At that time it was very difficult to import ready-made goods. Fortunately the system allowed the importation of components or knocked-down goods that you could assemble locally.”
Mr Mengi eventually acquired the financing and the components and navigated the bureaucracy to launch his business. He describes how he made money by producing shoe polish out of charcoal during the shortages.
But he says that decades of socialism have had a significant impact on society. “People don’t see opportunities in things,” he says. “We have so much in Tanzania people need help to see the opportunities which are there.”
The economy did open up in the late 1990s under President Benjamin Mkapa. But Mr Mengi says the policies ushered in an era of crony capitalism.
The government is trying to reassure foreign investors it wants their business
By last year the situation “had reached tipping point”, according to Mr Mengi, and he is relieved that the new president, John Magufuli, has prioritised fighting corruption.
Mr Mengi acknowledges the president has yet to articulate his economic vision, but he understands why this has taken time.
“If someone has a heart attack what do you do? Poop poop poop, you try and revive them. You don’t think, ‘Shall I give them a Panadol?’” he says while miming using a defibrillator. Despite painting a gloomy picture, Mr Mengi says businesspeople should not be too downcast about the current “bad times”.
“People with guts will make a lot of money in bad times, a lot of money,” he insists. “Beauty is in the eye of the beholder. You can say this is good times or bad times depending on the beholder.”
Copyright The Financial Times Limited 2016. All rights reserved. You may share using our article tools. Please don't cut articles from FT.com and redistribute by email or post to the web.
Interview with Tanzanian media mogul Reginald Mengi - FT.com