Exclusive Interview with Tanzania Chamber of Commerce, Industry and Agriculture

Interview with Magdalene Mkocha, Acting Executive Director of Tanzania Chamber of Commerce, Industry and Agriculture (TCCIA)

To what extent does the private sector have a role to play in ensuring that there is a proper mechanism for reporting and monitoring NTBs (non-tariff barriers), and in effectively collaborating with the government to eliminate those that are reported by SMS?

We as the Tanzania Chamber of Commerce, Industry and Agriculture host the monitoring office and the system itself. The NTB Coordinator sits within our organisation, but the Chamber also participates in the forum where the private sector and the public sector meet to keep informed of reported NTBs, as well as urging the relevant organisations, ministries, departments or agencies causing these NTBs to eliminate those in question. This is called the ‘National NTB Monitoring Committee’. As one of its members, we take part in both its national and regional forums. But there is equally a regional NTB Monitoring Committee at the East African level, in which we also take part. Reporting is therefore carried out, monitored and brought up at these forums by the private sector.

There have been several initiatives on this issue, but it obviously remains a problem, in as far as it effects the system, involves unfair practices, collusion, etc. Is it fair to say that the NTBs remain a significant challenge, particularly with regard to cross-border trade in and around the EAC region?

The elimination or reduction of NTBs is still a challenge, given that new NTBs evolve from time to time, and as such is something that requires continuous effort. Even in cases where we have seen a reduction in some NTBs, albeit not their total elimination, we see new NTBs springing up, being reported through the system and then resolved.

How has the Tanzanian government performed in terms of implementing the infrastructure components of their medium-term development plan, which runs from 2015?

I would say that it is in the process of being implemented. The government’s recently-launched 5-year development plan seeks to prioritise issues related to infrastructure and energy, among others, but the issue of industrialisation is equally being addressed. In this year’s budgetary allocation, you will find that energy and infrastructure have been the country’s priority sectors. Therefore, my assessment is that it is still in the process of being implemented.

They have big plans. Gas has now been found off-shore, and the government wants to set up refineries, perhaps LNG (Liquid Natural Gas), they’re looking to build new power stations, and they want Tanzania to become a major transhipment hub, for energy and the broader region. But obviously, these things are very expensive, as they involve huge capital projects and may take decades to come to fruition.

True, although these are not government projects per se. The government is giving energy priority in its plans, but is also seeking to attract investment both from inside and outside to come and invest in these areas, such as gas exploration, energy distribution, etc.

Will the TCCIA have an increasingly important role to play?

Of course, because we also coordinate incoming business delegations. We recently received the Austrian business delegation. Yesterday, we hosted the India-Tanzania Business Forum, and whenever we meet with them, we also draw their attention to the country’s investment opportunities. As such, we have a significant role to play, but also in terms of motivating domestic investors to enter into partnerships wherever necessary. When business delegations arrive, we seek to link them up with these local partners for B2B meetings. These are designed to bring together local and foreign investors, in the context of facilitation by the TCCIA.

I understand that bilateral trade with India is really flourishing?

It is indeed flourishing. India has actually been one of the country’s long term business partners.

How does the TCCIA assist businesses in settling disputes, without legal recourse, in terms of arbitration issues? What kind of mediational support do you offer under the ICC?

As yet, we have not very formally established the mediation and arbitration desk, but we are in the process of doing so. In spite of this, we have already been carrying out some mediation with the assistance of foreign chambers, as a member of the ICC. When a dispute arises between a Tanzanian company and a foreign company, we take collaborative measures through the ICC: we inform the chamber of the country in question, in order to assist the local company in resolving the dispute.

When business delegations arrive, we seek to link them up with local partners for B2B meetings. These are designed to bring together local and foreign investors, in the context of facilitation by the TCCIA.

This has happened several times. For instance, one of our members had dispute with a company in the Middle East, where the local company was importing tarmac and paid the Middle Eastern company in full for the supply, but that company vanished after shipping just one consignment. Through our ICC membership, we linked up the Tanzanian company with a chamber in the Middle East, which sought out the company in question and met with them, which led to the dispute’s resolution. In fact, they returned the local businessman’s money.

The TCCIA now has a strategic plan in place for 2015-2020. How did the principle incorporated therein align with Tanzania’s overall commitment as part of the UN Global Compact?

Under the UN Global Compact, there are also issues concerning Corporate Social Responsibility, for which we launched a Tanzanian chapter, and to which we now belong. We have motivated various companies, including our President’s company, to subscribe to CSR. But also in terms of the issue of dispute resolution. For instance, we are in cooperation with Canada to establish a desk for mediation and dispute resolution.

Agriculture and tourism are the two sectors that are very much seen as the country’s ‘sleeping’ giants, which really need to be tapped, in accordance with the EAC Common Market Protocol. This in particular would create a myriad of opportunities for young people, and for the business community more widely in Tanzania. What other sectors of business activity do you think could potentially present a further range of opportunities for your country?

Besides tourism and agriculture?

Those are certainly the mainstays, with 75% of the population still employed in the agricultural sectors. But what other sectors are you looking to tap into and develop?

Industrialisation is one such sector, but equally the need to link both those sectors. You see, agriculture supplies the tourism sector, including hotels and other related activities, as well as being the source of raw material for industry. Therefore, we strive to link these sectors through a number of initiatives, so as to enable them to support each other.

When it comes to industrialisation in Tanzania, the first step is the development of low-end food and agro-processing. Developing agriculture therefore means industrialisation becomes easier, rather than depending on imported raw material to supply our industry. The other sector would be energy, which is also an important sector, because it supports industry. Without a reliable and adequate supply of energy, you cannot easily industrialise.

And I understand that the energy supply has become much more reliable, with many enhancements?

For a long time, it was simply the Tanzania National Electric Supply Company carrying out the supply, transmission, etc. But this has now been liberalised, thus ensuring any company able to generate energy, and others able to supply it, may become involved; as well as cases where companies may undertake both the transmission and supply of energy, in what is now a liberalised market.