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Tanzania Daily News (Dar es Salaam) | Sebastian Mrindoko | 23 November 2011
"In terms of resources, Tanzania is one of the richest countries in the world but poor planning on how to harness them profitably has impacted heavily on the current economic situation including the ill-fated performances of the shilling," said Dr Haji Semboja from the University of Dar es Salaam, in an interview in Dar es Salaam on Thursday.
THE poor ownership structure has been blamed on the minimal contribution of the natural resources on the economy.
He gave an example of the current efforts to revamp the State Mining Corporation (STAMICO), a government arm in the mineral sector which compels an investor to enter into partnership with the government.
But with the projects already in progress which are 100 per cent foreign owned, Dr Semboja said the nation is getting very little and this has a negative impact on the stability of the shilling.
The shilling kept on showing improvement after the Central Bank interventions that enabled it to trade at a narrow margin above 1,700/- a US dollar on Monday, this week.
However, the local currency experienced the lowest trading level in history in October in as many years after hitting 1,800/- a dollar.
Dr Semboja cited developed countries like China and Canada which have in place clearly defined policies on how to harness natural resources.
"If we have clearly defined investment policies on natural resources, we will put little effort to solicit investors who at times, give a lot of strict conditions to the government," said Dr Semboja.
Presenting a paper at an annual insurance day recently, Prof Humphrey Moshi of the Economics Department at the University of Dar es Salaam said there are a lot of linkages in the mining sector which destruct the economy.
He said where investment on natural resources is 100 per cent foreign owned, the government will fail to quantify exactly the total earnings generated in such projects.
Commenting on the shilling performances, Prof Moshi said it is disadvantageous to the nation where the Bank of Tanzania (BoT) leaves the local currency and the US dollar to be used parallel.
Instead, he said the government should encourage the use of locally made goods, cut down expenditures in order to increase development budget.
He said there is need to increase development budget to between 40 to 50 per cent from the current 8 to 10 per cent that persisted in the last 10 years.
"In terms of resources, Tanzania is one of the richest countries in the world but poor planning on how to harness them profitably has impacted heavily on the current economic situation including the ill-fated performances of the shilling," said Dr Haji Semboja from the University of Dar es Salaam, in an interview in Dar es Salaam on Thursday.
THE poor ownership structure has been blamed on the minimal contribution of the natural resources on the economy.
He gave an example of the current efforts to revamp the State Mining Corporation (STAMICO), a government arm in the mineral sector which compels an investor to enter into partnership with the government.
But with the projects already in progress which are 100 per cent foreign owned, Dr Semboja said the nation is getting very little and this has a negative impact on the stability of the shilling.
The shilling kept on showing improvement after the Central Bank interventions that enabled it to trade at a narrow margin above 1,700/- a US dollar on Monday, this week.
However, the local currency experienced the lowest trading level in history in October in as many years after hitting 1,800/- a dollar.
Dr Semboja cited developed countries like China and Canada which have in place clearly defined policies on how to harness natural resources.
"If we have clearly defined investment policies on natural resources, we will put little effort to solicit investors who at times, give a lot of strict conditions to the government," said Dr Semboja.
Presenting a paper at an annual insurance day recently, Prof Humphrey Moshi of the Economics Department at the University of Dar es Salaam said there are a lot of linkages in the mining sector which destruct the economy.
He said where investment on natural resources is 100 per cent foreign owned, the government will fail to quantify exactly the total earnings generated in such projects.
Commenting on the shilling performances, Prof Moshi said it is disadvantageous to the nation where the Bank of Tanzania (BoT) leaves the local currency and the US dollar to be used parallel.
Instead, he said the government should encourage the use of locally made goods, cut down expenditures in order to increase development budget.
He said there is need to increase development budget to between 40 to 50 per cent from the current 8 to 10 per cent that persisted in the last 10 years.