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Tanzania Exports To Kenya

Discussion in 'Kenyan News and Politics' started by RRONDO, May 3, 2010.


    RRONDO JF-Expert Member

    May 3, 2010
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    Tanzania Exports to Kenya On Rise

    Dar es Salaam — Tanzanian exports to Kenya have registered 17% increase in value, narrowing the trade balance gap between the two countries.
    Kenyan High Commission to Tanzania, Mr. Mutindo Mutiso said Tanzanian revenue from exports to Kenya has grown to US$95.8 million (KShs7.3 billion) in 2008 compared to $86.6 million (KShs6.6 billion) in 2007. He said this was a 17% increment.
    In 2006 Tanzania's exports to Kenya revenue stood at $59.1 million (KShs4.5 billion); in 2005 it stood at $36.8 million (KShs 2.8 billion) and in 2004 at only $26.3 million (KShs2 billion).
    "The volume of exports from Tanzania to Kenya rose by 17% in 2008 whileKenya's export into Tanzania rose by 27% during the same period," said Mr. Mutiso.
    Ambassador Mutiso added that Kenya's exports into Tanzania in 2008 were valued at KShs29.3 billion which is up from KShs22.3 billion in 2007. The value of exports from Kenya into Tanzania in 2006 stood at KShs18.3 billion.
    Mutiso added that the fast rising of Tanzania's exports to Kenya will work to narrow the trade balance gap between the two
    countries due to the increasing of cross-border trade and investments.
    The move signifies that Tanzanian products have the competence to cater for the Kenyan market and trade between the two countries is expanding.
    The major exports from Tanzania to Kenya include raw cotton and seed cakes, hides and skins, live animals, timber and timber products, fish and fish fillets.

    Other major exports are milk, cereals (mainly beans and maize) fruits, onions, tyres, detergents, gemstones, groundnuts and power transformers.
    Kenyan exports to Tanzania include fuels and oils, beverages and spirits, soap and other washing preparations, paper and paperboard, machinery and mechanical appliances, Other major exports from Kenya to Tanzania are motor vehicles, iron and steel and articles thereof, rubber and articles thereof, milled products, financial and banking services, and human and technical skills. High Commissioner Mutiso said another important aspect of the bilateral relations is with respect to Tanzania being major receipt of foreign direct investment (FDI) from Kenya with an overall investment portfolio of $ 2,087 million.
    The multi-million dollar investment portfolio came from 346 investors as at December 2008 making Kenya the second largest injector of FDI into Tanzania after the United Kingdom. "Currently, there is more than 346 Kenyan companies operating in Tanzania which have cumulatively created over 45,737 jobs," said Mutiso. These investments are spread out in various sectors ranging from manufacturing, tourism, services, financial institutions, agriculture, construction, transport, petroleum and mining, natural resources, human resources and telecommunication.
    Tanzania Investment Centre (TIC) Director of Investments Promotion, Mr. Raymond Mbilinya said recently most investments from Kenya have targeted the industrial and construction sectors.

  2. G

    Geza Ulole JF-Expert Member

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    they should be good at saying Kenya incorporated companies investing in Tanzania and which machines and cars is Kenya exporting to Tanzania? i know they assemble cars which once where denied import permit since they didnt meet the criteria set that requires 35% of the car parts to be sourced from the country it come from
  3. Nyaralego

    Nyaralego JF-Expert Member

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    @ Geza Ulole, You had to chip in your 2 cents...Kenya on any thread is like a red flag for you... hahahahaa

    DE_GUZMANN Member

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    Kenya's trade relations with Tz is like the same trade relation btwn KE and UK.....I mean,the same way UK imports raw
    coffee from us and sells us Nescafe at 5 times the price....we import raw milk and sell Brookside 2 them..hahahah,laughable
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    Geza Ulole JF-Expert Member

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    [h=1]Tanzanian Investment to Grow 10% in 2013 With Help of Chinese[/h]By David Malingha Doya - Mar 1, 2013
    Tanzania expects foreign direct investment to grow 10 percent this year from $13 billion in 2012 after China replaced the U.S. as the fourth-largest investor in the East African nation's economy.
    China, which was not among the top 10 investors in Tanzania in 2011, contributed $1.4 billion, ahead of the U.S. investment of $950 million, acting Tanzania Investment Center Executive Director Raymond Mbilinyi said in an interview in Dar es Salaam, the commercial capital.
    "We also have new projects we expect to register in the course of the year in the sectors of agriculture and infrastructure," he said yesterday.
    Tanzania, East Africa's second-biggest economy, in January hired Citigroup Inc. to help it secure a sovereign credit rating before its sells its first Eurobond. Tanzania vies with Mali to be Africa's third-largest producer of gold, and has so far confirmed 33 trillion cubic feet of natural gas.
    Sichuan Hongda Co., a Chinese Zinc producer, and Tanzania in September 2011 signed a $3 billion agreement to develop coal- mining and steel production projects, after beating 40 contestants for the tender including BHP Billiton Ltd. (BHP), and Rio Tinto Group, according to Mbilinyi.
    The Export-Import Bank of China loaned $1.2 billion to build a 500-kilometer (311-mile) gas pipeline from Mtwara to Dar es Salaam. Chinese investors are expected to start more projects this year in agriculture, infrastructure and manufacturing, Mbilinyi said. He declined to give further details.
    [h=2]Infrastructure Opportunities[/h]The U.K. topped the country's FDI list last year with $4.7 billion from companies including BG Group Plc (BG/) and SABMiller Plc. (SAB)India invested $1.8 billion while Kenya, where most multinational companies operating in East Africa are based, followed with $1.5 billion, Mbilinyi said.
    Poor infrastructure has made Tanzania a high-cost business area, according to investors including African Barrick Gold Plc. (ABG) The company, the biggest miner of the metal in Tanzania, on Feb. 13 said production would slow because of high operational costs including unreliable and inadequate electricity.
    "It is true we have problems in infrastructure, which is not good for our investment climate, but we now want to turn these problems into opportunities," Mbilinyi said.
    Public-private partnerships "are going to be a common mode of investment henceforth. For instance, we will invite private companies to invest in road construction, where they can recoup from a road toll," Mbilinyi said.
    To contact the reporter on this story: David Malingha Doya in Dar es Salaam at dmalingha@bloomberg.net

    Tanzanian Investment to Grow 10% in 2013 With Help of Chinese - Bloomberg
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    Geza Ulole JF-Expert Member

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    The UNCTAD World Investment Report, 2012 indicates that Af-rican received only 3.5% of the total global foreign direct investment (FDI) in 2011-meaning there was little to be shared by the continent's more than 50 countries.
    In East Africa, Tanzania and Ugan-da dominated the market-mainly from oil-related investments.
    Rwanda whose receipts increased by 4%, was dominated by external long-term loans to mining, ICT and finance, according to the national 2012 survey on Foreign private Capi-tal inflow.
    According to UNCTAD, Tanza-nia attracted a record of $1.1 billion worth of foreign investments, over-taking the region's economic power-house, Kenya that suffered 22% de-cline.
    Other reports indicate that for the past three years, Tanzania has been claiming at least 47% of all FDI com-ing to the region.
    Tanzania's story would make inter-esting analysis for Rwanda's strate-gists whose ambition is to make the country the region's investors' first choice.
    For instance, inflow of FDI to Tan-zania was only $12million in 1992 and Rwanda would be interested in finding out how its neighbor to the east managed to rake in a record $1,095million in 2011 pushing its FDI stock $7.8billion from $388million in 1990.
    Business Monitor International (BMI) claims in its report that Tan-zania's favorable investment laws, declining corruption and good road coverage are some of the leading rea-sons making it make it a first choice destination for capital?
    The irony is that for the past three years in which Tanzania has attracted the most FDI, several international reports with an outstanding reputa-tion have all placed Rwanda as the best place to do business in the re-gion.
    When it comes to roads for instance; while its 8.9km of roads coverage per 100km2 is better than the east African average of 6.6km/100km2, Tanza-nia's roads are in extremely poor con-dition with only 8.9 per cent of them reportedly paved.
    So why is Rwanda at the bottom despite all the reforms that make it the best place in the region for busi-nesses to thrive?
    Some analysts point to the coun-try's recent political history that is mirrored in the 1994 genocide.
    In 1992 when Rwanda's govern-ment then was planning to massacre a section of its population, Tanza-nia was already attracting $12 mil-lion in FDI. However, 14 years after genocide, Rwanda's FDI inflow was $250.5million, a respectable pace ca-pable of catching the EAC leaders.
    But there's a more current reason for Rwanda's lag in FDI attraction and it's not anyone's fault. Oil deals were responsible for Uganda's FDI haul in 2011.
    According to the UNCTAD; inward FDI flows to Uganda were $792 mil-lion in 2011 most of it in oil deals but adds that its future green field proj-ects will be worth $6.1bn mainly due to huge petroleum finds.
    By Mid-last year, Uganda's FDI range was placed between $0.5billion and $2billion boosted by Tullow Oil (United Kingdom) announcement of its plan to invest $2.0 billion to estab-lish an oil refinery in Uganda.
    With Uganda's oil deposits expect-ed to be in place for more than two decades, it can expect heavy invest-ments from UK's Tullow Oil Com-pany, China's CNOOC and France's Total Company.
    Oil dollars:
    As for Tanzania, its $1.1billion FDI count in 2011 was mainly boosted by a $0.8 billion investment in fossil fuel and electric power project which ac-counted for more than 20 % of its to-tal value of green field projects .
    The list of Tanzania's top FDI sources would also be interesting for Rwanda as it features UK (23%), India (15%), Kenya (15), and Neth-erlands 10%, China 10%, USA 10%, South Africa 7%, Canada 5%, Germa-ny 3%, and Oman 2%.
    Are foreign investors running away from Kenya? If it's true, then Rwanda can use it as an opportuni-ty to provide the alternative because 2011 FDI movement indicates Kenya was Rwanda's biggest source with $66.7million, 18.3% of Kigali's total inflow.
    However, it could be that these are Kenyan firms such as Equity Bank and KCB, expanding to regional economies rather than foreign in-vestments shifting base from to the neighborhood.
    Nonetheless, the trend that Kenya's FDI declined to 22 percent in 2011 can't be ignored.
    Analysts have attributed Kenya's failure to attract more FDI to, weak corporate governance, cost of doing business, the absence of large-scale privatization programs and inade-quate FDI policy framework.
    With an aggressive plan to improve the investment environment, Rwanda could stand a chance of getting more of Kenya's FDI in years to come.
    But for Rwanda to make up for its lack of heavy minerals, the coun-try must deliberately target top FDI sources in America, Asia and Europe to come and invest in green field proj-ects.
    UNCTAD notes in its report that the $142 million renewable energy project from ContourGlobal (United States) represented 18% of Rwanda's total Greenfield investments in 2011. More of these would be good.
    Tanzania, Uganda Grab Bigger Share of EAC's Foreign Capital | TradeMark East Africa