Prominent Chief Executive Officers in the country last week presented their vision of how to position Tanzania to achieve hyper-growth over the next 20 years.
The presentation was made to President J. Kikwete at the annual CEO Roundtable held in Dar es Salaam last week. It aims to create a $176 billion dollar economy for 58 million people with a GDP per capita income of $3,000 by year 2025. (Currently, the size of the economy is $12.4 billion, population of 39 million with a per capita of $340 dollars, according to World Bank statistics).
To achieve this, it means the economy needs to grow at an exponential rate of 15.8%per annum over the next 18 years (in the past 5 years or so, the economy has been growing at a range of 6-7% annually). They argued that even though this may look challenging, but its not unprecedented. Angola’s economy, for instance, grew at 18% rate in 2005 and is projected to grow at 38% in 2008.
They advised Tanzania to focus on 5 key sectors to bring this hyper-growth:
a) Commodities, particularly minerals – The country has estimated mineral potential valued at $1.28 Trillion. Mineral processing and refining industries (value addition) need to be encouraged. Develop secondary industries out of mining boom by using earnings from the commodity boom to diversify to other industries.
b) Energy (oil, gas, hydro and bio-fuels) – Develop reliable sources of energy. A level playing field is needed as well as a sound regulatory framework (smart mineral policies).
c) Retail economy, particularly Tourism – Need to transform from heritage tourism (sight-seeing) to “lifestyle tourism” (e.g spa and recharge holidays) where tourists engage in activities. Focus should be to encouraged few tourists to spend more money; rather than increasing the number of tourists visiting the country to earn more money.
d) Financial services, particularly Housing financing – Strong demand for housing, population growth and migration all provide opportunity for hyper growth through construction and mortgage lending services. Build a country of home-owners, producers and consumers.
e) Infrastructure development –Needed to support all of the above. Also, develop IT, telecomm and mega projects such as developments of waterfronts and marinas, casino cities and weekend gateway areas. Aim to develop Tanzania into an international financial center and a trade gateway to the Far East.
In addition to the above, development of human capital is key to higher productivity. To this end, investment in education should be escalated. The public service also needs to transform its mindset to be able to deal with globalisation.
What do you think? Do you think these CEOs are dilusional in thinking that we can have this level of hyper-growth in Tanzania?
It can be done. Play your part! ~ Mwalimu Julius Kambarage Nyerere.
Happy Nyerere Day!