Modern industry knocking, but not with that many jobs

The facility, which will be producing transformer tanks and other tools, is billed to be the first of its kind in the East Africa region.

What is novel about this investment is that the company, Elsewedy Electric, has expressed intention to bring along artificial intelligence (AI) technology for use in its activities. That is obviously a step towards enhanced modernisation, complete with its pluses and minuses.

Ibrahim Qamar, the firm’s regional director for East Africa, made this affirmation while with officials of the Tanzania Investment Centre (TIC) visiting the construction site.

The ultramodern plant will cater for the entire East Africa sub-region, with Dar es Salaam as the hub of its activities, offloading 1,500 tonnes of cables and 300 transformer tanks monthly. Production is expected to begin this mid-June.

Qamar noted, with the world endlessly changing, there are new technologies coming and the firm opted for AI – including the use of robots – right from the start of its operations.

What this means, in part, is that the level of employment will be modest for a firm taking up such a large amount of capital, as it expects to line up anything between 250 and 400 local staff to start with.

The firm is also establishing a vocational training school within its factory’s premises for its internal capacity build-up as it widens its plans, among them post-sales customer care.

TIC officials have found the plans impressive, just as have other stakeholders in the electrical goods industry, optimistic that the company will offer jobs to Tanzanians and fill the local market with locally made products.

The use of robots certainly promises to make the goods cheaper in the market although, if the difference is distinctive, there will be pressures to protect some industries – as noticed in the cement industry. Competitive price margins make life easier but also put some investments at the exit door.

The idea that robot technology is coming to town is something worth talking about, and the idea that the first such investment isn’t a European or US firm is something else.

It is that globalisation is an issue of who puts up venture capital to do what project – and where. It isn’t a matter of cash coming from a country as such since companies have access to finance from any zone, and banks financing such a project in Egypt are likely to have exposure in high-end capital markets far afield. So we are drawn closer to those markets.

Chroniclers may one day identify this event as one that stamped the proper entrance of Tanzania and East Africa as a whole into the fourth industrial revolution globally.

With robot technology, just about everything is made possible, and manufacturing tools here implies that such investment can broaden to manufacture even the components of technology for manufacturing tools.

It reminds us of our own Basic Industries Strategy of 1975, taking over from import substitution outlooks earlier.

Granted, we didn’t get far, but this time is different in that at that time we were trying to use savings from crop exports to build industry, and now we are integrated with finance and technology circuits.