Tanzania: Not a place to invest in Africa
eTN earlier published an article on investing in Africa was based on a report by Rand Merchant Bank’s seventh edition of Where to Invest in Africa.
One of our readers in Tanzania strongly objected to the ranking of Tanzania and responded. eTN guaranteed for the writer to remain anonymous. The response reads:
Did the writer actually contact anyone running a business in Tanzania?? The writer of the report it is based on likely never did and wrote something from half a continent away with no idea what is actually happening to the business community.
Such articles and reports only serve to embolden current policies and will be used as encouragement that the path the current president is on is the correct one when it is in fact in a phase of rapid self-destruction.
A) investors are leaving in droves. Contact companies like Worldwide Movers to back this up.
B) many of the banks are on the verge of collapse due to a high level of nonperforming loans – the economy has tanked and people can’t pay the loans back. Several have already collapsed. Annual accounts/statements showing this have been pulled from websites.
C) most, if not all, sectors are reporting a massive reduction in turnover and profits. Dealers in building supplies (a good indicator of growth) are reporting business as halved!
D) mining companies are being targeted with extremely questionable commodity value assessments and subsequent extortionate bills for tax (search Acacia).. They are closing and retrenching workers.
E) The tea industry (Unilever, Mufindi Tea Company etc) hasn’t made a profit in several years, resulting in large-scale retrenchments (thousands of workers over the last two years), company sale and bank repossession.
F) The tourism industry is experiencing similar difficulties in being levied an unsustainable level of regulatory compliance and tax burden. Many, especially in southern Tanzania, are being sold.
G) the value of construction timber/forestry has also collapsed because people aren’t building, and would be even worse had it not been for a questionable decision to move thousands of government workers to Dodoma. Pine tree blocks that would sell for Tsh13m-16m were subsequently being traded at Tsh2-3m! Private forestry operators such as Green Resources are in trouble and retrenching.
H) industrial exports have declined these last months/year.
I) investors are being harassed and extorted left right and center. The Tourism sector is paying 56 or so DIFFERENT TYPES of taxes and fees. The revenue authority district and regional managers are being told to raise revenue on a shrinking economy whatever the cost – driving more to close businesses in record numbers.
J) work permits are being rejected or delayed for months in an anti-foreigner angle, so management of investments/projects is getting impossible
K) political opposition leaders are being shot in the streets (search Tindu Lissu), being arrested on trumped-up charges and passing through police stations like a merry go round. Any public of social media statements are deemed illegal and there are allegedly dozens in jail and court for Facebook posts etc. Their houses and offices are being bombed or set alight. Political parties are not being permitted to organize meetings/rallies. Parliament has been muzzled – their live TV broadcast cut off and MPs are being arrested regularly for charges of sedition etc.
L) The government isn’t listening to the pleas of the private sector – just bulldozing back to the socialist policies that Nyerere collapsed the economy with last time.
And against this backdrop, the article states that Tanzania went up two places?? What planet are they from?!
What other indicators would the writers look at?!!