TANZANIA: Making strides under a popular president
For decades after independence from Britain in 1961, Tanzania (formed from Tanganyika and Zanzibar, appeared to languish in a group of Africa’s least successful countries. It was led by Julius Nyerere, who attempted to create his own brand of African socialism, ujamaa, and organized a decade of collectivization to bring it about. But, as in the Soviet experiment, it was a failure, and Tanzania went from being Africa’s largest agricultural exporter to its largest importer. Nyerere stepped down in 1985, and is still revered as the father of the nation. It wasn’t until 1995 that multiparty elections were held and the country began to move resolutely towards a market economy.
Today, Tanzania is emerging as a nascent African success story. Its popular president, Jakaya Kikwete, won election in 2005 with over 80 percent of the vote, after serving 10 years as foreign minister. Rich in mineral resources, Tanzania is on track to move from third to first place among Africa’s gold exporters, and it is home to many other precious minerals, including Tanzinite, named by Tiffany’s for the only country in the world where it has been found. And with the magnificent Serengeti, Mount Kilimanjaro and three of Africa’s largest lakes, Tanzania is a leading candidate to become Africa’s premier tourist destination.
Tanzania’s ambassador to Washington, Andrew Mhando Daraja, recently sat down with DiplomaticTraffic.com to talk about progress being made in his country, and the need to diversify the economy away from its traditional dependency on agriculture, which still employs some 80 percent of the population of 37 million, even though only 4 percent of the land is arable. With a median age of just 17.7 years, Tanzanians have a GDP per capita of only $700, one of the lowest in the world.
The popularity of President Kikwete
President Kikwete is a very charismatic leader, which he has demonstrated in various posts he has held, in the army, his political party and the government. He is the longest-serving foreign minister in Tanzania: 10 years. To many people he represents a new generation of leaders. That is why he is very popular among the youth. And with the kinds of policies his political party stands for, it makes him even more popular.
For quite some time we have had leaders who are ‘beyond’ the youth. Now we have a very youthful character who appeals to the youth. At 56, he is young compared to previous leaders. He is a link for the transition we are going through, from a socialist-based economy to private sector economy. He serves as a member of the new generation.
The Julius Nyerere legacy
He is still viewed as the Father of the Nation. We benefited a great deal from Nyerere’s leadership. That is why today, for example, people know very well that Tanzania is the most peaceful country in the region. This was partly due to the role of Nyerere to unite the people, encouraging them to live side-by-side with different religions, different tribes. Encouraging one language. Those things have put the country in a more united front than many African countries. And his trying to provide free education and healthcare helped unite the country more than many African countries. So national unity and solidarity, peace and stability, were all built up by the first president. These benefits we cherish.
Creating a peaceful African nation
I don’t think there is one formula. But let us confess that the personality of leaders matters. A leader really has to be selfless, with greater interest in the nation than in himself. That is why Nyerere encouraged unity, encouraged peace and stability, and encouraged people to live together harmoniously. His personality really counted. Coupled with the policies he instituted, that made a lot of difference to the country.
We have been going through social, political and economic reforms for the last ten years or more. These reforms have proved to be successful. One of the pillars the president has to keep in mind is that peace and stability are maintained. Then to strengthen the reforms that have been going on, not only in the economic field, in macroeconomic balancing, where inflation has been brought from more than 35 percent to less than five percent. During the campaign he was very popular with the youth, and one of the things he encouraged them with was that he would work very hard to create jobs. So he has to create those jobs to get the economy moving.
It is not easy to create jobs. Private investment is part of the strategy. There are potentials in all sectors in Tanzania. If you can manage to exploit those potentials by inviting both foreign and local investment, jobs will be created, and that is why we put a lot of emphasis on creating the right environment for investment.
Why investors should choose Tanzania
First, we have abundant natural resources, in agriculture, minerals and tourism. Second, peace and stability: every investor will want to go where he is safe, and that is guaranteed in Tanzania. Third, we have an investment law which guarantees a lot of incentives for investors, like a tax break for the first five years, depending on how much they invest. Foreign investors can own 100 percent of their Tanzania investment, or enter into joint ventures with local partners.
It is not working as fast as we want but at least progress is going on. For example, look at the huge investments in the mining sector. Who would have known five years ago that Tanzania would be the third largest exporter of gold in Africa, only second to Ghana and South Africa. And with new discoveries, I wouldn’t be surprised if in the next five years Tanzania becomes the largest exporter of gold in the continent. All this is because of the international mining companies that have flocked to Tanzania. We have known for a long time that we have gold, diamonds, Tanzanite of course, which is exclusive to Tanzania.
Booming tourism industry
Tourism is one of the fastest-growing sectors in the Tanzanian economy. For example in 2000, we had about 200,000 tourists. By 2004 we had over 600,000. It is a very important source of income and jobs. We are creating the necessary infrastructure to accommodate the increasing number of tourists. There are investments in hotels and roads leading to tourist attractions. Most hotels in Tanzania are 100 percent owned by foreign investors.
In 2002 there were 20,000 US tourists going to Tanzania. Today the figure is around 50,000 a year. We encourage Americans to explore beyond the Caribbean!
Tanzania has far superior attractions to Kenya. I can’t see anything which matches the Serengeti. I can’t see anything that matches the Ngorongoro Crater [home to one of Africa’s richest populations of wildlife]. Every time I go back to Tanzania I visit the Ngorongoro Crater and see a different part of it. Kilimanjaro is the highest mountain in Africa. We have the beautiful beaches of Zanzibar along the Indian Ocean. Scuba diving. We have cultural tourism for those who prefer to see the people rather than the animals. There is something for every interest.
So far there are no direct flights to the US. There are negotiations with an American company to go direct to Tanzania.
Relations with the United States
Relations between the United States and Tanzania are at their best level, they are excellent. That is why they encourage US investment. The new Tanzanian president has made two quick visits to the United States this year, and both times met President Bush. The other positive indicator is that we have qualified for MCC and we expect to be awarded an $800 million grant. It will cover infrastructure, energy and water.
The infrastructure inherited from colonialism was built to move raw materials from the interior to the ports for export, especially by rail. We don’t have a network of roads and railways that can bring produce from the rural areas to markets. So infrastructure is extremely important.
Energy is important, because investors will need power for projects. We have been very much dependent on hydro power. The efforts being made now are to diversify our sources of energy, including coal and gas, which are abundant in Tanzania. It is a question of getting the right investment to exploit the oil and coal. Chances are there is also oil somewhere.
The war on terror
The bombing of the US Embassy in Dar Es Salaam in 1998 was a very isolated incident that took advantage of our being a very peaceful country. When you live under peace you tend to relax a little and [the terrorists] took advantage, because the American Embassy in Dar Es Salaam was a ‘peoples embassy’. It was so accessible. People used to go there to watch films. The bombing put us on guard. We now work very closely with US authorities in the war against terror.