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MP queries General Tyre unaccounted; Machines rotting since 2007

Discussion in 'Habari na Hoja mchanganyiko' started by nngu007, Apr 8, 2011.

  1. nngu007

    nngu007 JF-Expert Member

    Apr 8, 2011
    Joined: Aug 2, 2010
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    MP for Arusha Godbless Lema

    Mystery surrounds the whereabouts of some USD 10 million that the government released some years ago for the revival of the General Tyre factory in Arusha.

    Government officials say the money was given to the new investor to run the plant but whose production stopped in the late 1990s. It is still not clear whether the money was utilised for the purpose.

    The deputy minister for Industries, Trade and Marketing Lazaro Nyalandu was vocal during his recent visit to the collapsed firm, saying officials suspected to have squandered the money must be taken to task.

    He said when visiting the closed General Tyure factory, that those responsible should be taken to task, including confiscating their properties.

    The deputy minister made the remarks after he was informed that some $10 million (about Sh. 15bn) that was advanced by the National Social Security Fund (NSSF) to revive the factory could not be accounted for. He was apparently in incensed by the report presented to him on the loss and promised that everything should be done to ensure that those responsible were brought to book.

    " We will ensure that those responsible for the loss were identified and stern measures taken against them", he said in response to a report presented to him by the Arusha Urban MP (Chadema) Godbless Lema.

    Mr. Nyalandu added that officers from the Audit and Controller General (CAG) would be deployed to investigate the scam, now a matter of concern in the government.

    He hinted that the collapsed tyre firm, which stopped production four years ago, received funds to revive it from various sources other than NSSF.

    However, he did not reveal which other financial institutions or potential investors have given funds for the revival of what used to be the tyre
    manufacturing plant in the country.

    Production at the General Tyre Factory stopped since 1997

    He added that the government was still looking for a strategic investor to put the factory into production but after concluding discusssions with the former investor Continental Tyres of Germany.

    Mr. Nyalandu said a tender of a firm that will take over would be advertised sometime later and that local companies would be given priority.

    He explained that closure of the plant has rendered jobless hundreds of people who used to serve the firm and impacted on the Arusha
    economy in general.

    The minister ordered the Tanzania Electric Supply Company Limited (Tanesco) to connect power to the closed factory within seven days while efforts are underway to revive it.

    He warned that there was a danger of the machinery, such as the cooling systems, breaking down because of disconnection of electricity.

    However, the Arusha MP, on the other hand, told the minister that most of the machineries are worn out or outdated and that the new investor should come out with new technology.

    General Tyre (EA), started production in 1971, becoming the first tyre making firm in East Africa. During its peak it made about 1,000 tyres a day.

    It closed production in the 1997 at the height of privatisation of the state-owned firms. In 2002, Continental Tyres was advanced $ 10 million by the government to put it back into production.

    However, the plant suspended production again in 2007 when the same German firm demanded another $ 2 million from the government which turned down the request.