Dismiss Notice
You are browsing this site as a guest. It takes 2 minutes to CREATE AN ACCOUNT and less than 1 minute to LOGIN

FACTBOX: Key political risks to watch in Tanzania

Discussion in 'Jukwaa la Siasa' started by Selemani, Oct 27, 2010.

  1. S

    Selemani JF-Expert Member

    #1
    Oct 27, 2010
    Joined: Aug 26, 2006
    Messages: 866
    Likes Received: 4
    Trophy Points: 35
    Off Reuters.

    At least this one seems independent. Kusoma Uhuru/Mzalendo/Tanzania Daima/Raia Mwema/Mwananchi/Mtanzania/Rai, Unaweza kupata pressure za bure. Wajinga wanapendelea waziwazi with no ethical journalism.

    Chini angalieni inflation rate. Naona humu ndani tulikuwa tunadanganyana sana kuhusu inflation.


    Fri Oct 22, 2010
    By Fumbuka Ng'wanakilala


    DAR ES SALAAM Oct 22 (Reuters) - Tanzania, east Africa's second largest economy, holds a general election on Oct. 31, with President Jakaya Kikwete of the ruling Chama Cha Mapinduzi (CCM) party seeking re-election for a second and final term.

    Kikwete is expected to win easily but with less than the 80.3 percent he landed in 2005.

    The election is seen as a test for the ruling party's dominance in Tanzania, which has been struggling with poverty and underdevelopment.

    POLITICS AND THE ELECTION

    Two opinion polls this year show Kikwete, 60, would beat opposition candidates comfortably. A poll by the University of Dar es Salaam in April showed 77.2 percent support.

    Synovate said in June that Kikwete's popularity had declined to 69 percent from 73 percent previously. This partly reflected criticism of how he handled threats by labour unions of a nationwide strike over pay and conditions.

    What to watch:

    -- Growing support for opposition presidential candidate Willibrod Slaa of Chadema party. Slaa, 62, has been drawing huge crowds at campaign rallies across Tanzania, with promises to tackle poverty, improve social services, clean up corruption among politicians and restore public trust.

    He is seen as Kikwete's strongest challenger and has pledged to review all mining contracts in Africa's third largest gold producer if elected.

    -- Conduct of vote. Opposition parties have alleged fraud in previous elections and say vote rigging by the ruling party might be repeated this year.

    Law enforcement agencies and state-run media have traditionally favoured the ruling party during election periods. The National Electoral Commission is seen lacking the independence to oversee a truly free and fair vote.

    -- Disputed results. The declaration of presidential results by the electoral commission is final and cannot be challenged. But political observers expect a wave of legal actions to challenge the results of parliamentary elections.

    -- Electoral violence. Skirmishes might occur between supporters of the main political rivals -- CCM and Chadema -- in some closely contested parliamentary constituencies. However, mainland Tanzania is expected to hold a largely peaceful poll.

    -- Zanzibar. A close result is expected on the violence-prone Indian Ocean archipelago. Seif Sharif Hamad, leader of the opposition Civic United Front (CUF) party, is locked neck and neck for the Zanzibar presidency with the ruling CCM party's Ali Mohamed Shein.

    Zanzibar's outgoing president, Amani Abeid Karume, has approved a constitutional amendment that will force the rival parties to share power. The reform, passed in a referendum, follows a gradual rapprochement between the CCM and CUF.

    However, the parties could be hard pressed to persuade hardliners to accept the outcome and agree to take part in a coalition government, so bouts of unrest cannot be ruled out.

    -- Kikwete's health. Kikwete is widely expected to win, with the ruling party maintaining its majority control of parliament, even though opposition parties are expected to win more seats.

    However, Kikwete has collapsed in public at least times since 2005, raising questions about whether he is fit enough to run the country. The government says Kikwete is in "perfectly good health" and blames the incidents on fatigue.

    MINING LEGISLATION

    Tanzania's parliament passed a new mining law in April that increases the rate of royalty paid on minerals such as gold from 3 percent to 4 percent and requires the government to own a stake in future mining projects.

    As part of the new legislation, Tanzania will not issue new gemstone mining licences to foreign companies, while current agreements with foreign mining companies remain unchanged.

    The government says the reforms are aimed at ensuring the country gets a better share of its resources by creating a "win-win" situation for both mining firms and the country.

    African Barrick Gold has four gold mines in Tanzania while Australia's third largest gold miner, Resolute Mining and South Africa's Anglogold Ashanti also have gold operations there. British mining company African Eagle is raising funds for its nickel project in Tanzania.

    What to watch:

    -- Investor reaction. Mining companies have rejected the new law, saying it would further erode investor confidence. They described the legislation as "distorted" and warned that it would curtail future mining projects.

    -- The government is in talks with mining companies on plans to abolish tax exemptions on fuel imports.

    -- Progress on development of uranium deposits in Tanzania

    -- Further offshore discoveries of oil and natural gas. Whether recent attacks by Somali pirates off the Tanzanian coast were aimed at exploration operations.

    ECONOMY

    A Reuters poll of nine economists showed in August the economy should grow 6.3 percent this year and 6.8 percent in 2011, thanks to robust activity in all sectors, while inflation will stay in single digits through to 2011.

    But government critics say poverty remains widespread among the population of 40 million, with the benefits of economic growth yet to trickle down.

    The economy depends on tourism, mining and agriculture and is attracting investor interest in telecommunications, energy, manufacturing, financial services and transport.

    What to watch:

    -- Widening current account deficit. Analysts expect the deficit to widen to 8.0 percent of GDP in 2010 and to 9.2 percent in 2011, although the rising price of gold and higher exports should cushion costly oil imports.

    Gold export earnings rose 15.4 percent in 2009 to $1.1 billion and had climbed to $1.38 billion by the end of June this year.

    -- Debt sales. Tanzania plans to issue a debut $500 million Eurobond after it gets a sovereign rating. Plans to issue a sovereign bond were shelved because of the financial crisis but revived this year.

    In May, the finance minister plugged a financing deficit with syndicated loans. Analysts say the government has shown a bigger appetite for treasury securities in recent months.

    Some analysts say that Tanzania will probably have to liberalise its capital account to get a sovereign rating, a move that could boost investor interest in its financial markets.

    -- Weak currency. The shilling has been easing steadily since the start of 2010. The weakening shilling and dry weather are expected to put pressure on consumer prices.

    Inflation fell to a five-year low of 4.5 percent in September from 6.6 percent in August. Inflation in east Africa often depends on weather because food carries significant weight in consumer price baskets. The region relies on rain-fed agriculture and recent droughts have hit its economy badly.

    -- Donor funding. Foreign donors slashed contributions to budget funding by $534 million in May on concerns about the slow pace of reforms and graft. Further reductions could put pressure on the shilling and on government spending plans.

    -- Social tensions. Teachers and other civil servants are demanding a salary hike and may stage nationwide protests.


    (Editing by Richard Lough)
     
  2. M

    Mwafrika JF-Expert Member

    #2
    Oct 27, 2010
    Joined: Nov 20, 2006
    Messages: 5,491
    Likes Received: 5
    Trophy Points: 0
    Bwa ha ha ha ha ha ha ha
     
  3. M

    Mwafrika JF-Expert Member

    #3
    Oct 27, 2010
    Joined: Nov 20, 2006
    Messages: 5,491
    Likes Received: 5
    Trophy Points: 0
    [​IMG]
     
  4. M

    Mwafrika JF-Expert Member

    #4
    Oct 27, 2010
    Joined: Nov 20, 2006
    Messages: 5,491
    Likes Received: 5
    Trophy Points: 0
    [​IMG]
     
  5. M

    Mwafrika JF-Expert Member

    #5
    Oct 27, 2010
    Joined: Nov 20, 2006
    Messages: 5,491
    Likes Received: 5
    Trophy Points: 0
    [​IMG]
     
  6. M

    Mwafrika JF-Expert Member

    #6
    Oct 27, 2010
    Joined: Nov 20, 2006
    Messages: 5,491
    Likes Received: 5
    Trophy Points: 0
    [​IMG]
     
  7. N

    Njimba Nsalilwe JF-Expert Member

    #7
    Oct 27, 2010
    Joined: Mar 23, 2008
    Messages: 251
    Likes Received: 0
    Trophy Points: 0
    Does anyone know the progress of the investors' reaction regarding what they so call "distorted" legislation?

    My take!

    Curtailing future mining projects is it an issue? I remember our first President JKN opted for this solution. Leave our minerals where they are. But with the current administration I doubt????? May be with Dr Slaa would be possible!!!!!!!

    NN
     
  8. EMT

    EMT JF-Expert Member

    #8
    Mar 2, 2011
    Joined: Jan 13, 2010
    Messages: 14,215
    Likes Received: 157
    Trophy Points: 160
    This Reuters' article sums up all about what is going in Tanzania. It is problems after problems. The word is also spreading quickly globally


    By Fumbuka Ng'wanakilala

    DAR ES SALAAM, March 1 (Reuters)

    Tanzania's government is under growing pressure as economic hardships, corruption allegations and calls for constitutional reforms continue to dominate politics in east Africa's second largest economy.

    The main opposition party, Chadema, which uses "people power" as one of its popular political slogans, has threatened to organise nationwide demonstrations for change.

    Opposition leaders have given President Jakaya Kikwete an ultimatum to fix the economy, tackle large-scale bribery and deliver a new constitution or face mass protests.

    Kikwete, who was re-elected in an Oct. 31 vote marred by a record low turnout and accusations of rigging, has dismissed opposition's demands and accuses it of trying to destabilise the country.

    Since the start of the year, the 60-year-old moderate Muslim has had to deal with widening rifts within the ruling party and government.

    Here are some risk factors to watch out for:

    TUNISIA COPYCATS

    Thousands of protesters took to the streets on Feb. 24 when Chadema held a peaceful demonstration in the second-largest city, Mwanza. Opposition leaders have threatened to organise demonstrations modelled on protests in Tunisia, Egypt and Libya.

    Police shot dead at least two protesters in the northern town of Arusha on Jan. 5. Kikwete's main rival in the elections, Willibrod Slaa, and several Chadema lawmakers were detained by police and charged with unlawful assembly in the incident. Chadema leaders spoke of a deliberate crackdown.

    A full-blown Tunisia-style uprising is unlikely in Tanzania, but opposition demands for economic, social and political reform are beginning to resonate with the public.

    What to watch:

    -- Political unrest. The opposition wants to organise nationwide demonstrations to "liberate" Tanzanians from poverty and corruption. There is risk of violence if police move to block opposition protests in future.

    -- Economic hardship. Rising food and fuel prices are eroding support for Kikwete's government and the ruling Chama Cha Mapinduzi (CCM) party. May trigger protests.

    CORRUPTION IN POLITICS

    Kikwete promised to clean up corruption in politics when he first won office in 2005. But his first term was overshadowed by high-level scandals, forcing him to dissolve his entire cabinet in 2008 over corruption allegations in an energy contract.

    While Tanzania's stability in a sometimes turbulent region has appealed to donors, the country has seen its ranking in Transparency International's Corruption Perceptions Index, a measure of perceived public sector corruption, plunge 32 places over the past two years.

    Donors slashed funding pledges for Tanzania's budget by nearly $250 million due to graft and the slow pace of reforms and could freeze more funds for the upcoming 2011/12 budget.

    What to watch:

    -- Dowans scandal. International arbitrators have ordered state-run Tanzania Electric Supply Company (TANESCO) to pay a private firm, Dowans Holdings SA, $65.8 million, plus interest, for breach of a power generation contract.

    The government initially agreed to pay without seeking legal recourse, but has been forced to backtrack and try to find ways out of paying, after criticism from opposition leaders, the public and lawmakers from the ruling CCM party.

    Allegations of large-scale corruption in the same contract led to the resignations of then prime minister Edward Lowassa and two other senior ministers in February 2008.

    In an unprecedented move, some senior cabinet ministers in Kikwete's government have publicly clashed over the contract.

    -- Waning anti-graft war. Leaked U.S. cables from its embassy in Dar es Salaam showed Tanzania's anti-corruption chief feared for his life and believed lack of political will was undermining the fight against graft in the country.

    According to a July 2007 cable, Edward Hoseah, director general of the Prevention and Combating of Corruption Bureau (PCCB), noted "President Kikwete's reluctance to implicate former President Benjamin Mkapa or members of Mkapa's inner circle in corruption scandals".

    Hoseah, whose PCCB has been investigating the sale of an air traffic control system by BAE Systems to Tanzania, described the sale as a "dirty" deal but has failed to prosecute anyone yet.

    The PCCB has been widely criticised for failing to tackle major corruption, focusing instead on petty graft cases.

    LABOUR, STUDENT UNREST

    There have been a series of boycotts, protests and demonstrations at public and private universities across the country over delayed and insufficient student loans.

    Kikwete has accused his political rivals of planning to orchestrate widespread student boycotts and street demonstrations in an attempt to destabilise his government.

    What to watch:

    -- Growing student protests. Analysts warn unrest over loans and tuition fees could spread to more universities in Tanzania. Authorities have used riot police and teargas to disperse students as they chanted slogans against the government.

    -- Union demonstration. Trade union leaders have planned nationwide demonstrations to protest a rise in power tariffs by 18.5 percent at the start of the year. No date has been set.

    Lack of electricity is widespread and regular power outages slow down business. The government has defended the tariff rise, saying it was caused by underlying financial and economic factors. But union leaders blame the government for failing to improve pay and conditions for workers amid rising living costs.

    MINING REFORM

    Tanzania, Africa's fourth biggest gold producer, earned $4.7 billion from mining in the past five years and is seeking to boost income further through state ownership of future projects. Parliament passed a mining law in April increasing royalties paid on minerals like gold to 4 percent from 3 percent.

    African Barrick Gold has four gold mines in Tanzania while Australia's third largest gold miner, Resolute Mining and South Africa's Anglogold Ashanti also have operations in the country. London-listed African Eagle is raising funds for a nickel project.

    What to watch:

    -- Investor reaction. Mining firms have rejected the law, saying it would erode investor confidence.

    -- The government is in talks with mining companies on plans to abolish tax exemptions on fuel imports.

    -- Further offshore discoveries of oil and natural gas.

    TROUBLED ECONOMY

    Tanzania's economy is expected to grow by 7.2 percent this year from an estimated 7.0 last year due to a strong recovery after the global financial crisis. But dry weather this year could affect power generation and food production, pushing up prices and slowing economic growth.

    What to watch:

    -- Rising inflation. Tanzania's year-on-year inflation rate rose to 6.4 percent in January from 5.6 percent in December. Rainfall has an outsized influence on inflation in east Africa, because rains lead to good harvests and lower prices.

    Ongoing political turmoil in oil-producing Arab countries will likely push up the cost of fuel and lead to inflation.

    -- Energy crisis. The state-run utility imposed Christmas power cuts after a shortage of natural gas to turbines led to a power deficit. Power rationing was expected to end in January, but drought at hydropower stations has now pushed up the power deficit to 230 MW.

    -- Widening current account deficit. Analysts expect the deficit to widen to 8.0 percent of gross domestic product in 2010 and to 9.2 percent in 2011, although the rising price of gold and higher exports should cushion costly oil imports.

    -- Debt sales. Tanzania plans to issue a debut $500 million Eurobond when it gets a sovereign rating. Some analysts say Tanzania may have to liberalise its capital account to get a rating, a move that could boost investor interest in Tanzania.

    -- Currency woes. The central bank has been intervening to defend a weakening shilling and stave off potentially destabilising import-led inflation. The weaker shilling and dry weather are expected to put pressure on consumer prices.

    FACTBOX-Key political risks to watch in Tanzania | News by Country | Reuters
     
  9. nngu007

    nngu007 JF-Expert Member

    #9
    Mar 19, 2011
    Joined: Aug 2, 2010
    Messages: 15,874
    Likes Received: 28
    Trophy Points: 145
    DAR ES SALAAM, March 18 (Reuters) - Tanzania's government is under growing pressure as economic hardships, corruption allegations and calls for constitutional reforms continue todominate politics in east Africa's second largest economy.The main opposition party, Chadema, which uses "people power" as one of its popular political slogans, has threatened to organise nationwide demonstrations for change. Opposition leaders have given President Jakaya Kikwete an ultimatum to fix the economy, tackle large-scale bribery and deliver a new constitution or face mass protests. Kikwete, who was re-elected in an Oct. 31 vote marred by a record low turnout and accusations of rigging, has dismissed opposition's demands and accuses it of trying to destabilise the country. Since the start of the year, the 60-year-old moderate Muslim has had to deal with widening rifts within the ruling party and government.

    Here are some risk factors to watch out for: ( I have attached more on this atticle as per request from Members in Jamii Forum) We need to discuss to better our People.
    1: TUNISIA COPYCATS
    2: CORRUPTIONS IN POLITICS
    3: LABOR AND STUDENTS UNREST
    4: MINING REFORM
    5: TROUBLED ECONOMY

    View attachment FACTBOX - TANZANIA.docx
     
  10. Elli

    Elli JF-Expert Member

    #10
    Mar 19, 2011
    Joined: Mar 17, 2008
    Messages: 23,758
    Likes Received: 4,503
    Trophy Points: 280
    Mmhhhh, let us wait and see
     
  11. B

    Byendangwero JF-Expert Member

    #11
    Mar 20, 2011
    Joined: Oct 24, 2010
    Messages: 872
    Likes Received: 3
    Trophy Points: 0
    In addition there are three or four scenerior likely to cause political risks;
    1. Growing gap in income between the top exercutive and the rank and files throughout the government machinery; this is likely create disharmony even in security organs.
    2. Race for the presidential succession is likely to tear apart the ruling party especiary given the fact that many people believe that Jk is still bent to see to it that EL, who is largely blamed for plunging CCM into its current crises succeed him
    3. The government machinery is proving to inept and ill prepared for the task at hand, consequently the socio-economic strain facing the country is likely to grow in the next five years.
     
  12. nngu007

    nngu007 JF-Expert Member

    #12
    May 3, 2011
    Joined: Aug 2, 2010
    Messages: 15,874
    Likes Received: 28
    Trophy Points: 145


    Tue May 3, 2011 12:51pm GMT


    By Fumbuka Ngwanakilala

    DAR ES SALAAM May 3 (Reuters) - Tanzania's 2011/12 budget is due in June, with the government targeting higher spending and growth, but political uncertainty is threatening to overshadow an otherwise bright future for the nation.

    The leadership of the ruling Chama Cha Mapinduzi (CCM) party resigned in April and was swiftly replaced by fresh faces amid infighting among senior politicians in a race to succeed President Jakaya Kikwete, who must step down in 2015.
    Kikwete has pledged to bring in reforms and sack corrupt CCM politicians as the party prepares for the next election.

    But he faces fresh wrangling between senior CCM leaders at a time when the opposition party Chama Cha Demokrasia na Maendeleo (Chadema) has emerged as the main threat to his ruling group's 50-year grip on power.

    Here are some risk factors to watch out for:

    POLITICAL UNREST
    Following the unprecedented resignation of CCM's top leadership, some prominent politicians linked to well-known corruption scandals got a 90-day ultimatum to relinquish all leadership positions in the party.

    Former prime minister Edward Lowassa, who was forced to resign from the government in 2008 over allegations of corruption in an energy contract, is among the targeted politicians.

    The list also includes two close allies of Lowassa -- business tycoon Rostam Aziz and former minister Andrew Chenge.


    What to watch:
    -- Deepening divisions. Lowassa's supporters in CCM may try to undermine Kikwete's leadership, destabilising the party.
    -- Anti-government protests. Opposition leaders said they plan to organise nationwide demonstrations to call for a new constitution and a stronger crackdown on corruption. They are also angry about the rising cost of living in East Africa's second largest economy.
    -- Economic hardship. There is growing public demand for better management of Tanzania's natural resources, while rising poverty is eroding support for Kikwete's government and the ruling CCM party.
    -- The political uncertainty could undermine the country's relatively rosy economic prospects. Spending is projected to rise 7.85 percent to 11.97 trillion shillings ($7.94 billion) in the year to June 2012 and the economy should post annual growth rates of 6.8-10 percent over the next five years in an environment of single-digit inflation, according to the latest government estimates.


    FIGHT AGAINST CORRUPTION
    Kikwete promised to clean up corruption in politics when he first won office in 2005. But his first term was overshadowed by high-level scandals, forcing him to dissolve his cabinet in 2008 over corruption allegations connected to an energy contract.

    The country has seen its ranking in Transparency International's Corruption Perceptions Index, a measure of perceived public sector corruption, plunge 32 places over the past two years.

    Donors slashed funding pledges for Tanzania's budget by nearly $250 million due to graft and the slow pace of reforms and could freeze more funds for the upcoming 2011/12 budget.

    What to watch:
    -- Dowans scandal. International arbitrators have ordered state-run Tanzania Electric Supply Company (TANESCO) to pay a private firm, Dowans Holdings SA, $65.8 million, plus interest, for the breach of a power generation contract.
    The government initially agreed to pay without seeking legal recourse, but has been forced to backtrack and try to find ways out of paying, after criticism from opposition leaders, the public and lawmakers from the ruling CCM party.
    -- Waning anti-graft war. Leaked cables from the U.S. embassy in Dar es Salaam showed Tanzania's anti-corruption chief feared for his life and believed lack of political will was undermining the fight against graft in the country.
    According to a July 2007 cable, Edward Hoseah, director general of the Prevention and Combating of Corruption Bureau (PCCB), noted "President Kikwete's reluctance to implicate former President Benjamin Mkapa or members of Mkapa's inner circle in corruption scandals".
    Hoseah, whose PCCB has been investigating the sale of an air traffic control system by BAE Systems to Tanzania, described the sale as a "dirty" deal but has failed to prosecute anyone yet.
    The PCCB has been widely criticised for failing to tackle major corruption, focusing instead on petty graft cases.


    LABOUR, STUDENT UNREST
    There have been a series of boycotts, protests and demonstrations at public and private universities across the country over delayed and insufficient student loans.
    Kikwete has accused his political rivals of orchestrating student boycotts and street demonstrations in an attempt to make the country ungovernable.

    What to watch:
    -- Students. Analysts warn unrest over loans and tuition fees could spread to more universities in Tanzania.
    -- Unions. Trade union leaders have planned nationwide demonstrations to protest against a rise in power tariffs by 18.5 percent at the start of the year. No date has been set.

    The government has defended the tariff rise, saying it was caused by underlying financial and economic factors.
    But union leaders blame the government for failing to improve pay and conditions for workers amid rising living costs.

    MINING REFORM
    Tanzania, Africa's fourth biggest gold producer, earned $4.7 billion from mining in the past five years and is seeking to boost income further through state ownership of future projects.
    Parliament passed a mining law in April increasing royalties paid on minerals like gold to 4 percent from 3 percent.
    African Barrick Gold has four gold mines in Tanzania while Australia's third largest gold miner Resolute Mining and South Africa's Anglogold Ashanti also have operations in the country.
    London-listed African Eagle is raising funds for a nickel project.

    What to watch:
    -- Investor reaction. Mining firms have rejected the law, saying it would erode investor confidence.
    -- The government is in talks with mining companies on plans to abolish tax exemptions on fuel imports.
    -- Further offshore discoveries of oil and natural gas.


    SLOWING ECONOMY
    The International Monetary Fund has cut its 2011 growth forecast for Tanzania to 6 percent, saying frequent power outages would hurt output while food and fuel prices could push inflation higher.

    Tanzania's economy was initially expected to grow by 7.2 percent this year from an estimated 7.0 last year due to a strong recovery after the global financial crisis.

    Dry weather this year has affected power generation and food production, pushing up prices and slowing economic growth.


    What to watch:
    -- Rising inflation. Tanzania's consumer price inflation rose for the fifth consecutive month in March to 8.0 percent, but analysts expect the rate to fall in May and June thanks to upcoming food harvests.
    Rainfall has a significant influence on inflation in East Africa. Heavy rains lead to good harvests which drive down prices.
    -- Energy crisis. The state-run utility has imposed power cuts since Christmas after a shortage of natural gas cut supplies to turbines and drought at hydro-power stations led to a power deficit. Rolling power blackouts have eased in the past few weeks after recent rains, but prolonged power rationing risks denting growth further.
    -- Debt sales. Tanzania plans to issue a debut $500 million Eurobond when it gets a sovereign rating. Some analysts say Tanzania may have to liberalise its capital account to get a rating, a move that could boost investor interest in Tanzania.
    -- Currency woes. The central bank has been intervening to defend a weakening shilling and stave off potentially destabilising import-led inflation. This could heap pressure on policymakers to tighten monetary policy. (Editing by Andrew Heavens)
     
  13. nngu007

    nngu007 JF-Expert Member

    #13
    Jun 2, 2011
    Joined: Aug 2, 2010
    Messages: 15,874
    Likes Received: 28
    Trophy Points: 145
    Wed Jun 1, 2011 9:13am GMT


    By Fumbuka Ng'wanakilala

    DAR ES SALAAM, June 1 (Reuters) - Tanzania is expected to unveil plans this month to tackle a chronic energy crisis and rein in inflation, while keeping an eye on political unrest in some parts of the country.


    The east African country's 2011/12 budget reading is due on June 8. Concerns over an economic slowdown this year have prompted several parliamentary committees to reject pre-budget plans from a number of government ministries and demand more public investment in infrastructure projects.


    Opposition leaders have stepped up pressure on the government to tackle corruption and rising costs of living in east Africa's second-largest economy.


    Kikwete, who has pledged to bring in reforms, faces infighting in the ruling Chama Cha Mapinduzi (CCM) party, which is struggling with large-scale corruption allegations within its own ranks.

    Here are some risk factors to watch out for:

    POLITICS AND THE BUDGET
    The arrest of more than a dozen opposition figures last month, including at least three sitting lawmakers, charged with various offences, has raised political tensions ahead of the upcoming parliamentary budget session.

    While there is no risk to the passage of the 2011/12 budget because of CCM's comfortable majority in parliament, key cabinet ministers might face a grilling from both sides of the chamber over economic woes, energy shortages and infrastructure deficits.


    Opposition demands for a new constitution are expected to surface in parliament this month, putting pressure on Kikwete's government to speed up the process of adopting a new charter.


    The leadership of the ruling CCM party resigned in April and was swiftly replaced by fresh faces amid infighting among senior politicians in a race to succeed President Kikwete, who must step down in 2015.


    There are growing calls from within the party for more prominent politicians linked to well-known corruption scandals to go, including former Prime Minister Edward Lowassa and his two close political allies -- local business tycoon Rostam Aziz and former minister Andrew Chenge.

    Allegations of corruption, rising poverty, unemployment and high food and fuel prices are eroding support for the ruling party.

    What to watch:
    -- Political infighting. Lowassa's supporters in CCM are challenging calls for his exit and may try to undermine Kikwete's leadership, destabilising the party.
    -- Anti-government protests. Opposition leaders have been holding a series of well-attended demonstrations in major urban centres to call for a new constitution and a stronger crackdown on corruption. They are also angry about the power crisis and poverty in the country, which marks 50 years of independence later this year.
    -- Power crisis. The IMF has already revised its 2011 forecast downwards because of the crippling outages.

    Spending is projected to rise 7.85 percent to 11.97 trillion shillings ($7.94 billion) in the year to June 2012 and the economy should post annual growth rates of 6.8-10 percent over the next five years in an environment of single-digit inflation, according to the latest government estimates.


    FIGHT AGAINST CORRUPTION
    Kikwete promised to clean up corruption in politics when he first won office in 2005. But his first term was overshadowed by high-level scandals, forcing him to dissolve his cabinet in 2008 over corruption allegations connected to an energy contract.


    The country has seen its ranking in Transparency International's Corruption Perceptions Index, a measure of perceived public sector corruption, plunge 32 places over the past two years.


    Donors last year slashed funding pledges for Tanzania's budget by nearly $250 million due to corruption and the slow pace of reforms and could freeze more funds for the upcoming 2011/12 budget.


    What to watch:
    -- Central bank trials. Two businessmen were jailed in May for defrauding Tanzania's central bank of over $1 million in the first of a series of cases on scams on the bank that cost the country $87 million in 2005.

    Prosecutors are investigating one of the country's biggest corruption scandals comprising of about 20 separate cases of suspected fraud.
    However, critics of Tanzania's anti-corruption fight have accused the government of selective justice after failing to prosecute individuals linked to the ruling CCM party over the same scandal.

    -- Waning anti-graft war. Leaked cables from the U.S. embassy in Dar es Salaam showed Tanzania's anti-corruption chief feared for his life and believed lack of political will was undermining the fight against graft in the country.

    Tanzania's Prevention and Combating of Corruption Bureau has been widely criticised for failing to tackle grand theft, focusing instead on petty graft.


    LABOUR, STUDENT UNREST
    There have been a series of boycotts, protests and demonstrations at public and private universities across the country over delayed and insufficient student loans.


    Kikwete has accused his political rivals of orchestrating student boycotts and street demonstrations in an attempt to make the country ungovernable.


    What to watch:
    -- Students. Analysts warn unrest over loans and tuition fees could spread to more universities in Tanzania.
    -- Unions. Trade union leaders have planned nationwide demonstrations to protest against a rise in power tariffs by 18.5 percent at the start of the year. No date has been set.
    The government has defended the tariff rise, saying it was caused by underlying financial and economic factors.
    But union leaders blame the government for failing to improve pay and conditions for workers amid rising living costs.


    MINING REFORM
    Tanzania, Africa's fourth biggest gold producer, earned $4.7 billion from mining in the past five years and is seeking to boost income further through state ownership of future projects.


    Parliament passed a mining law in April increasing royalties paid on minerals like gold to 4 percent from 3 percent.

    African Barrick Gold said seven people were killed after hundreds of intruders raided its North Mara mine in an attempt to steal gold.

    Market analysts said the attack underscored African Barrick's difficult relations with the local community and risked eroding further the expectation that 2011 would provide the impetus for a re-rating in the shares.


    African Barrick has four gold mines in Tanzania while Australia's third largest gold miner Resolute Mining (RSG.AX) and South Africa's Anglogold Ashanti (ANGJ.J) also have operations in the country.
    London-listed African Eagle (AFE.L) is raising funds for a nickel project.


    What to watch:
    -- Investor reaction. Mining firms have rejected the law, saying it would erode investor confidence.
    -- The government is in talks with mining companies on plans to abolish tax exemptions on fuel imports.
    -- Further offshore discoveries of oil and natural gas. (Editing by Richard Lough)
     
  14. nngu007

    nngu007 JF-Expert Member

    #14
    Nov 8, 2011
    Joined: Aug 2, 2010
    Messages: 15,874
    Likes Received: 28
    Trophy Points: 145
    Tue, Nov 8th, 2011
    Tue, Nov 8th, 2011| Tanzania




    [​IMG]
    President Jakaya Kikwete



    DAR ES SALAAM Nov 8 (Reuters) – Tanzania is to introduce a constitutional review bill in parliament this month, but the main opposition party has threatened to boycott the move and call for protests if the bill passes because it says it gives too much power to the president.

    President Jakaya Kikwete's government has pledged to unveil a new constitution in 2014, a year before the country's next parliamentary and presidential elections.

    Opposition leaders, clerics and rights activists want to limit presidential powers, introduce electoral reforms and allow independent candidates to stand for parliament and president.


    The opposition CHADEMA party has accused the government of trying to hijack the constitutional review process and force its own bill through parliament, which is predominantly controlled by the ruling Chama Cha Mapinduzi (CCM) party.


    CHADEMA claims the bill gives Kikwete too much power to determine the outcome of the review process and that it was not properly vetted by a key parliamentary committee.


    Following are the main political risks ahead:

    POWER, POLITICS AND CORRUPTION
    Opposition leaders said they will call nationwide demonstrations if the bill is passed through parliament in the upcoming session set to start on Nov. 8 but the government has said it will move forward with the bill regardless.

    Lawmakers are also expected to debate the report of a parliamentary investigation into claims that a former official in the energy ministry, David Jairo, solicited money from the ministry's departments to pay illegal kickbacks to some MPs to approve the ministry's 2011/12 budget proposals.


    President Kikwete suspended Jairo, one of his former aides at State House, pending the outcome of the inquiry.


    CCM's national executive committee has delayed a key meeting expected to decide the fate of former premier Edward Lowassa and former minister, Andrew Chenge, who are under pressure to quit their positions in the ruling party over corruption allegations.


    What to watch:
    - Resignations. Members of Parliament could demand resignations of senior officials at the energy ministry over their handling of the ongoing power crisis and allegations over illegal payment of kickbacks to lawmakers.

    - Opposition protests. Police have issued a blanket ban on all demonstrations, claiming
    Tanzania was on alert against possible terror attacks from Somalia's al Shabaab militant group.


    - CCM divisions. Party members loyal to Lowassa may try to block moves to remove the former PM from his leadership position. Analysts say failure by CCM to deal with corruption in its own ranks could harm its chances of winning the 2015 election.


    - Kikwete. Will he back down from his attempts to clean up the image of the ruling party? Will he assert his leadership and push forward with his reform agenda?


    ECONOMIC SLOWDOWN

    Tanzania, one of the fastest-growing economies in Africa, has been battered by chronic power cuts that have plagued the country for the past year amid rising inflation.

    Rising food and fuel prices pushed the country's year-on-year inflation rate to 16.8 percent in September and analysts expect it to continue its upward trend until next year.


    The IMF cut its 2011 growth forecast to 6 percent from 7.2 percent in March, saying frequent power outages would hurt output while food and fuel prices could push inflation higher.


    The shilling has been easing steadily since the start of 2010, making imports more expensive. Increased oil imports for power generation are driving strong demand for foreign currency.


    What to watch:
    - Emergency power measures. Tanzania plans to spend 1.2 trillion shillings by the end of next year for emergency power projects.

    Chinese influence. China has been significantly expanding its footprint in Tanzania. Sichuan Hongda Co. Ltd. signed a $3 billion deal with Tanzania to mine coal and iron ore. The two countries also signed a $1 billion loan agreement to build a major natural gas pipeline. Tanzania is also seeking a $400 million loan from China to build a coal-fired power plant in Mbeya region. To what extent will the growing presence of China in Tanzania benefit the African country?


    - Youth unemployment. A high unemployment rate is fuelling tensions between youths and authorities in major urban centres.


    GRAFT FIGHT

    Kikwete promised to tackle large-scale corruption when he came to power in 2005, but his first term was overshadowed by high-level scandals, forcing him to dissolve cabinet in 2008.

    Donors have slashed funding pledges for the government's 2011/12 budget for a second straight fiscal year and the government has been criticised for its failure to tackle grand theft and instead mainly focusing on petty graft.


    What to watch:
    - Central bank trials. Two businessmen were jailed in May for defrauding the central bank of more than $1 million in the first of a series of cases on scams on the bank that cost $87 million in 2005. Will the government prosecute more cases?

    - Waning anti-graft war. Leaked cables from the U.S. embassy in
    Dar es Salaam showed Tanzania's anti-corruption chief believed lack of political will was undermining the fight against graft.


    ECONOMIC REFORM
    Tanzania's mining sector slumped in two consecutive quarters this year due to uncertainty over government policies, a prolonged energy crisis and infrastructure constraints.

    Africa's fourth-biggest gold producer, which passed a new mining policy in 2009 and subsequent legislation last year, plans to restructure the key sector.

    The government said it was also negotiating with mining companies to pay more taxes from mining proceeds.

    What to watch:

    - Mining talks. Mining firms are worried about the tax reform plan. Africa's biggest gold miner AngloGold Ashanti has started paying 30 percent corporate tax to the government this year for its Geita mine, but companies are resistant to higher royalties.

    - National debt. Government borrowing is set to rise as the country seeks funds for power and infrastructure projects. A debut $500 million eurobond is still on track as the country's national debt rose to $12.131 billion in the year to August from $12.112 billion at the end of July.


    - Central bank moves. The central
    Bank of Tanzania (BOT) is taking measures to lower the inflation rate and halt the depreciation of the shilling. It remains to be seen if the measures will succeed in the import-dependent country.

    By Fumbuka Ng'wanakilala, Reuters

     
  15. MartinDavid

    MartinDavid JF-Expert Member

    #15
    Nov 8, 2011
    Joined: May 22, 2009
    Messages: 854
    Likes Received: 18
    Trophy Points: 35
    Good Note Brother..... i will keep watching hope tough action a taken especially on constitution.
     
  16. nngu007

    nngu007 JF-Expert Member

    #16
    Nov 9, 2011
    Joined: Aug 2, 2010
    Messages: 15,874
    Likes Received: 28
    Trophy Points: 145
    Opposition lazima wazuie Rais asiwe na Nguvu na Pia walazimishe kuwa na Tume Huru ya Uchaguzi kama ile ya South Africa
     
  17. T

    Topical JF-Expert Member

    #17
    Nov 9, 2011
    Joined: Dec 3, 2010
    Messages: 5,177
    Likes Received: 4
    Trophy Points: 0
    There is big differences btn challenges and risks..

    Hiyo analysis ni kweli lakini ni hali ya kawaida kwa kiongozi..na katika utawala..

    I think consititutional review must go on hata kama wapinzani hawataki ..tunataka katiba mpya ..

    Na kina lowassa lazima wa step down kama wanataka waende upinzani..
     
Loading...