Why job creation remains a crucial issue in Tanzania

By Peter Keasi

Towards the end of last month when Minister of State in the President's Office (Investment), Prof Kitila Mkumbo, visited the offices of Tanzania Investment Centre (TIC) in Dar es Salaam, he appealed to workers to ensure TIC becomes truly part of national efforts in the creation of 8 million new jobs in the next five years. He said that would prove to prospective and performing investors that Tanzania was an ideal place for their investment money.

That was a pertinent appeal to TIC workers because creation of new jobs now remains a paramount national task in order to create conditions for a stable Tanzania and one with a competitive and prosperous economy. The national agenda is to make Tanzania a strong industrial economy by 2025.

Prof Mkumbo's call is pertinent for several other reasons. One such good reason is the demographic characteristic of the Tanzanian population. Tanzania has a very young population and there is expert evidence for this. The National Bureau of Statistics (NBS) report (2010) says: "Because of relatively high levels of fertility in the past, Tanzania has the majority of its population in young age groups ... (and the reason is that:) 23 per cent of women aged 15-19 years have begun childbearing: 17 per cent are already mothers, and 6 per cent are pregnant with their first child." But there is also good news in this report, "Nevertheless, the percentage of women aged 15-19 years who have begun childbearing has declined from that in the 2004-05 (when it was 26 per cent)". But the situation stays largely the same.

It is unsafe to treat this fact lightly because young people need jobs to feed and advance themselves and their families too. In many countries, social unrest is usually bred by idleness, frustration and figment of young persons' imagination. Further, external eyes are on millions of idle young people.

Young people with unmet, usually imaginary hopes, are always on the verge of criminality and can be easily organised and mobilised for criminal and even heinous and unpatriotic goals. This world is awash of small arms and when such arms land in idle hands countries slide into civil strife.

There is another good reason for a possibility of creating new jobs in Tanzania. The government took steps to address skill challenges by cooperating with the Tanzania Private Sector Foundation so that employers get right workers for their jobs. Further, salaries and incentives in Tanzania are investment friendly.

A need for "equipping the workforce with the skills required for the jobs of today and those of tomorrow," says TPSF, "is a strategic concern that will help Tanzania realise the envisaged industrial economy 2020 and attain middle-income economy 2025."

Last July, the World Bank said Tanzania had attained the lower middle-income economy status. The middle-income economy status bestows on the nation, the responsibility to promote vigorously local and foreign investments to create jobs, produce affordable industrial quality consumer goods for the local market and for exports.

Tanzania made pre-investment drive preparations because, according to TPSF, in the first decade of this century employers felt the impact of a talent shortage and also felt the skills gap would worsen in the future. Therefore, the government had to act. TPSF says the government "mandated TPSF to coordinate the establishment of sector skill councils to help the nation have accurate skills gap information that will act as an aggregator of industry interests." TPSF did this job cooperating with the Ministry of Education.

The councils, by and large, have linked key stakeholders such as firms, business associations, training providers, relevant ministries and regulatory agencies to this common concern and have helped in aligning the skills gap information towards achieving demand-driven skills through the provision of relevant training.

This is what the councils have done. They have done their best in identifying and priotising skills needed in their respective economic sectors. They have developed industry skills strategy and plans to achieve priority goals in line with the national skills development strategy and plan, they have been instrumental in defining and revising occupational and competence standards, training programmes and curricula, they facilitated industry membership on boards of training institutions, they also facilitated public-private partnership in training and most importantly promoted enterprise-based training for students and instructors.

So TPSF has a lot of information TIC would require for its own needs and this naturally means TIC has to work very closely with TPSF and the Tanzania National Business Council (TNBC) as it advances its own cause in doing its share of the national industrialisation agenda.

TPSF says skills development has concentrated on six initial key economic sectors "because of their economic growth and or job creation potential and their critical supporting role of other economic sectors." The six sectors are agriculture and agri-business, energy, construction, tourism and hospitality, transport and logistics and information and communications technology. TIC has to pay attention to these sectors.

It is probably because of this national achievement that Prof Mkumbo told TIC workers that they must explain well to prospective investors that the extensive reforms in the provision of education had enabled Tanzania to develop a skilled workforce in key economic sectors.

Agriculture and agri-business, as the metaphor says, is the backbone of Tanzania's economy. Agriculture is not only a big deal in Tanzania, but also in Africa. A research published in The Herald in June 2017 says: "small-scale farmers on family land are still the mainstay of African farming, producing 90 per cent of its food." But researchers complain that "their future is increasingly uncertain as the large-scale colonial model returns." Tanzania has to guard against such moves and help farmers produce quality crops and sell them to agro-industries established to increase their disposable income.

TIC, too, has a role to play, but first by putting its house in order. At least it has to identify potential investors in agriculture, help them grow and ensure agro-industrial investors have good relations with host farming communities. TIC also has some role to play by cooperating with other agencies and ensure investors buy crops without hitches either directly from farmers or through their cooperative societies and unions and also ensure investors reciprocate in a humane manner.

It has been argued in foregoing paragraphs that TIC has to work very closely with TPSF because the former has a lot of useful information on skills development in this country. Not only that, there is another good reason for doing so. TPSF, we are told, has 198 business associations and is in contact with more than six million entrepreneurs in both formal and informal private business. So, if TIC has to tap into the experience of entrepreneurs, it has to work closely with TPSF.

TIC must also see a need to work closely with cooperative unions and guide or mould them into powerful local investors. Investment is about having money to pump into a project. If money is not stolen or property is not mismanaged, cooperatives have money with which to start investment projects. With expert intervention from TIC, cooperatives can join local or foreign prospective investors and establish processing agro-industries and agri-businesses.

Then, there is the least talked about the question of building the technical base at village level or call it the grassroots, raised since 1967 TIC and other agencies have to pay attention to. Education for self-reliance sought to produce people who were relevant to their own communities. Primary, secondary leavers and now tertiary college graduates are supposed to be skilled creators of wealth in their communities because of the education they receive. This has always been the aim of education, more so education for self-reliance.

To simplify the argument, let us put it this way. Electricity is flowing to villages, an investor in mechanised agriculture, for example, must not only recruit the youth from host communities to do manual labour, but must establish a service centre for tractors and other machines and equipment and use workshops to help young people acquire technical skills that have relevance to themselves and their communities. The same applies to investors in agro-processing enterprises. This would be the fastest way of building a technical base at the grassroots.

Investment is a multi-sector undertaking. As argued earlier, TIC has to put its house in order and identify agencies to work with very closely. Take the example of sisal. For many decades until in the second half of the last century, the world used sisal and jute bags and ropes before they were shrewdly replaced by synthetic fibre.

But now Tanzania, and perhaps the world, sees a need to use organic products - including sisal - to protect environment, taking advantage of scientific and technological inventions and innovations now available to humankind. By the way, Tanzania is the second world producer of after Brazil.

All said TIC, as an investment facilitator, has had an impressive performance record. Between 1990 and 2018, it facilitated the establishment of 11,509 projects - 9,248 new ones - all valued at $174,412m, creating 1,517,306 jobs. On top of the list were industrial 3,945 projects, followed by tourism (2,483), commercial buildings (1,511) and transportation 1,434 projects.

Region wise, between 1997 and 2018, Dar es Salaam secured the highest number of projects (6,061), followed by Arusha 1,416 projects, Coast (568) while Simiyu and Songwe got 2 and 1 projects respectively. Regional authorities and regional business councils must work closely with TIC to promote investments in their areas.

TIC Executive Director, Dr Maduhu Kazi, said TIC had been well-positioned to work very hard and diligently to meet the fifth phase government's expectations of transforming Tanzania into an industrial economy by 2025.

"We are set to work diligently in line with government's directives. Your visit to the centre meant a lot for us," Dr Kazi told Prof Mkumbo when he made a maiden tour of the centre late last year, noting that TIC was well-prepared to attract, promote and market investment potential existing in Tanzania.

Dr Kazi said TIC would continue being a conveyer-belt between the government and investors.

This article was originally published by Daily News. [Photo: Pintrest]