Dubai accords on investment a wake-up call for parastatals

Indeed, she has been tirelessly fighting woo foreign investors in various zones and hotspots to take an interest in Tanzania.

That should help ease efforts by the country’s diplomatic missions to put the finishing touches to interest already created, concerning opportunities that they already appreciate.

When the leadership hasn’t actually conducted ground-breaking work, it isn’t easy for foreign missions to make inroads into fixed mindsets outside.

One area where the president’s visits are changing the picture of investment pursuits from what was traditionally the case is that it isn’t just a matter of inviting foreign firms to start new projects by allocating them land, supported by the existence of the right infrastructure.

It is also not just an issue of promising the speeding up of the issuance of business and other licences or simply laying out investment incentives in the sense of tax holidays.

It is now more a matter of joint venture projects involving public firms and private companies than obtained previously.

Our country needs considerable opening up of its economy so that funds resulting from such ventures can enter the financial system and be loaned out usefully.

That is precisely the kind of environment that the president has laid the basis for actual realisation with the just-endorsed Dubai Forum accords, as major projects involving public companies have prequalified government guarantee.

This contrasts with traditional investment in a private capacity and in several areas starting to compete with prerogatives of this or that parastatal.

For instance, a firm starting an electrical appliances venture but the energy parastatal isn’t involved is bound to fail as it would then have to do business with a rival. Drawbacks of this sort will likely be dealt with conclusively with the current approach.

We may not have crossed the horizon yet, but it must be admitted that it makes much economic sense thinking of joint venture projects where a win-win situation is assured.

That would replace failures where parastatals engaged with foreign firms on the basis of pseudo-privatisation. Hopefully, we have since learnt the right lessons to enable present-day agreements to travel a wiser and more rewarding path into success and profits, not litigations.