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Hapa dunia ya wafanyabiashara inawaza itafanyaje biashara na nchi ambayo haina uhakika na kesho yake.
Je sekta nyingine zitabaki salama kweli?
Tanzania's Acacia Spat Shows Deepening Battle With Business
by
Omar Mohammed
June 14, 2017, 2:00 AM GMT+3 June 14, 2017, 8:45 AM GMT+3
On Monday, the 57-year-old leader ratcheted up his dispute with miners by accusing Acacia Mining Plc of operating illegally in Tanzania and insisting the government is owed billions of shillings of unpaid taxes. It’s the latest in a series of broadsides against private investors who are being unnerved by his administration’s stance and its lack of consultation on policy. Shares in Acacia, which denies any wrongdoing, slumped as much as 16 percent.
John Magufuli
Photographer: Simon Maina/AFP via Getty Images
“It’s negative that you have these uncertainties playing out in the market, especially at a time when you’re relying on growth and infrastructure development to be supported by private sector activity,” said Lisa Brown, a risk analyst at Rand Merchant Bank in South Africa.
Magufuli came to power 19 months ago with a pledge to industrialize sub-Saharan Africa’s sixth-biggest economy. The country has transport and utilities projects worth at least $19 billion in the pipeline, according to PricewaterhouseCoopers LLP. Last week, the Finance Ministry said it will spend at least 1.8 trillion shillings ($809 million) in the next fiscal year on projects including building a standard-gauge railway and upgrading its main port in Dar es Salaam.
‘Important Ally’
While Magufuli has said the private sector is “an important ally” in the government’s development efforts, it has yet to secure funding for the key projects like the railway. The Finance Ministry said June 7 it’s in the final stages of talks with Credit Suisse Group AG on a $500-million loan for financing projects, without providing further details.
The uncertain regulatory environment in Tanzania is likely to weigh on investment flows, threatening the viability of the infrastructure projects, BMI Research, a unit of Fitch Ratings Ltd., said last week.
“Regulatory uncertainty and higher operating costs will test the viability of future projects in a range of sectors, likely leading foreign investors to reconsider future investment, which will weigh on the country’s long-term growth prospects,” it said in a research note.
Government revenue collection in the past financial year suggests a slowdown in private sector activity and increased stress, according to RMB’s Brown. Confusion over structural adjustment of the economy and lack of clear communication from the government has resulted in slower decision making, especially on new and expansionary investment, she said.
While analysts agree that the way in which Magufuli is carrying out the reforms may be too hard-line, they also accept that the policy overhaul is necessary. The president’s approach is akin to economic nationalism that is ultimately aimed at nation-building, Gilead Teri, director of policy at the Tanzania Private Sector Foundation in Dar es Salaam, said by phone.
‘Cutting Corners’
“In the previous administration, people were used to cutting corners,” Teri said. “He thinks if the business environment is corrupt, everybody loses. If you have a system tilted towards one side it hurts the private sector.”
Calls to presidency spokesman Gerson Msigwa weren’t answered when Bloomberg sought comment, while Finance Ministry spokesman Ben Mwaipaja declined to comment when reached by phone.
EcoEnergy Scandinavia AB of Sweden. In March, Washington-based Symbion Power said it’s seeking arbitration after the Tanzanian government terminated a power-purchase agreement and is targeting a $560-million settlement.
The Symbion announcement was followed by comments from a diplomat with the U.S. Embassy in Tanzania expressing concern over “discouraging signs on the private sector side.”
“I think it’s really important when a U.S. company signs an agreement that both parties receive the goods and services and payments that have been agreed upon,” Virginia Blaser, charge d’affaires at the embassy, said in an interview with Tanzania’s Citizen newspaper published May 31. “I think there can be some improvements there.”
The latest dispute with Acacia represents an “unprecedented escalation” by the government toward the mining industry, said Ahmed Salim, an analyst with Dubai-based Teneo Strategy.
That’s left investors worried about where Magufuli might turn his attention next, said RMB’s Brown.
“No one knows whether he’s going to move onto other sectors and what it means for future investment,” Brown said.
Je sekta nyingine zitabaki salama kweli?
Tanzania's Acacia Spat Shows Deepening Battle With Business
by
Omar Mohammed
June 14, 2017, 2:00 AM GMT+3 June 14, 2017, 8:45 AM GMT+3
- Accusation against miner is latest broadside against business
- Tanzania needs investors to help fund $19 billion of projects
On Monday, the 57-year-old leader ratcheted up his dispute with miners by accusing Acacia Mining Plc of operating illegally in Tanzania and insisting the government is owed billions of shillings of unpaid taxes. It’s the latest in a series of broadsides against private investors who are being unnerved by his administration’s stance and its lack of consultation on policy. Shares in Acacia, which denies any wrongdoing, slumped as much as 16 percent.
John Magufuli
Photographer: Simon Maina/AFP via Getty Images
“It’s negative that you have these uncertainties playing out in the market, especially at a time when you’re relying on growth and infrastructure development to be supported by private sector activity,” said Lisa Brown, a risk analyst at Rand Merchant Bank in South Africa.
Magufuli came to power 19 months ago with a pledge to industrialize sub-Saharan Africa’s sixth-biggest economy. The country has transport and utilities projects worth at least $19 billion in the pipeline, according to PricewaterhouseCoopers LLP. Last week, the Finance Ministry said it will spend at least 1.8 trillion shillings ($809 million) in the next fiscal year on projects including building a standard-gauge railway and upgrading its main port in Dar es Salaam.
‘Important Ally’
While Magufuli has said the private sector is “an important ally” in the government’s development efforts, it has yet to secure funding for the key projects like the railway. The Finance Ministry said June 7 it’s in the final stages of talks with Credit Suisse Group AG on a $500-million loan for financing projects, without providing further details.
The uncertain regulatory environment in Tanzania is likely to weigh on investment flows, threatening the viability of the infrastructure projects, BMI Research, a unit of Fitch Ratings Ltd., said last week.
“Regulatory uncertainty and higher operating costs will test the viability of future projects in a range of sectors, likely leading foreign investors to reconsider future investment, which will weigh on the country’s long-term growth prospects,” it said in a research note.
Government revenue collection in the past financial year suggests a slowdown in private sector activity and increased stress, according to RMB’s Brown. Confusion over structural adjustment of the economy and lack of clear communication from the government has resulted in slower decision making, especially on new and expansionary investment, she said.
While analysts agree that the way in which Magufuli is carrying out the reforms may be too hard-line, they also accept that the policy overhaul is necessary. The president’s approach is akin to economic nationalism that is ultimately aimed at nation-building, Gilead Teri, director of policy at the Tanzania Private Sector Foundation in Dar es Salaam, said by phone.
‘Cutting Corners’
“In the previous administration, people were used to cutting corners,” Teri said. “He thinks if the business environment is corrupt, everybody loses. If you have a system tilted towards one side it hurts the private sector.”
Calls to presidency spokesman Gerson Msigwa weren’t answered when Bloomberg sought comment, while Finance Ministry spokesman Ben Mwaipaja declined to comment when reached by phone.
EcoEnergy Scandinavia AB of Sweden. In March, Washington-based Symbion Power said it’s seeking arbitration after the Tanzanian government terminated a power-purchase agreement and is targeting a $560-million settlement.
The Symbion announcement was followed by comments from a diplomat with the U.S. Embassy in Tanzania expressing concern over “discouraging signs on the private sector side.”
“I think it’s really important when a U.S. company signs an agreement that both parties receive the goods and services and payments that have been agreed upon,” Virginia Blaser, charge d’affaires at the embassy, said in an interview with Tanzania’s Citizen newspaper published May 31. “I think there can be some improvements there.”
The latest dispute with Acacia represents an “unprecedented escalation” by the government toward the mining industry, said Ahmed Salim, an analyst with Dubai-based Teneo Strategy.
That’s left investors worried about where Magufuli might turn his attention next, said RMB’s Brown.
“No one knows whether he’s going to move onto other sectors and what it means for future investment,” Brown said.
