Tanzania to acccelerate industrialisation with industrial bank and tax reduction

Tanzania to acccelerate industrialisation with industrial bank and tax reduction

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TANZANIA is to support local industries with the establishment of an industrial development bank and reduction taxation on locally produced goods, President John Magufuli said early June. Tanzania aims to become a semi-industrialised nation by 2025.

To achieve this, the contribution of manufacturing to the national economy must reach a minimum of 40 percent of the GDP, Tanzania’s 2025 vision indicates. Currently, Tanzania’s industrial sector contributes around 25 percent to the country’s GDP with an average annual growth of 8 percent.

In order to accelerate industrialisation, the President has urged banks to lower interest rates for industrial projects. In addition, the government will strengthen the Tanzania Investment Bank (TIB) and establish an industrial development bank to accelerate industrialisation in the country.

The President also stressed that taxes on locally produced goods should be reduced considerably to allow industrialists to compete. In order to create international competitiveness for export led economic growth, Tanzania established its Export Processing Zones (EPZ) in 2002 to provide for the establishment of export oriented investments within the designated zones. In 2015, EPZA members’ earnings reached TSh440bn (about $199 million) spread in a total of 130 industries while in 2016, earnings are expected to surpass the TSh600bn.
 

 

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