May 29, 1999

Upbeat TATEPA to float shares soon

TANZANIA Tea Packers (TATEPA) expects to float its shares on the Dar es Salaam Stock Exchange soon.

This was disclosed by the company’s managing director, George Theobald, in an exclusive interview with Business Times at the company’s factory premises in Mafinga on Tuesday.

Although he was reluctant to give details of the proposed flotation on the grounds that it was rather too early to do so – Theobld nevertheless said one of the objectives is to widen the ownership by Tanzania’s of the company.

"Although at present TATEPA is owned 80 per cent by Tanzanians, we would like to raise this even higher," he said. Another reason for floating the shares on the Dar bourse is "to raise funds with which to improve the company’s marketing and distribution network".

The possible date for the floatation of TATEPA’s shares on DSE is July this year in which more of its shares will e sold to the public.

Regarding the company’s performance, he said it has increased its production from between 20,000 and 30,000 kilogrammes a month when it started in 1994, to about 120,000 kilogrammes a month this year.

The company, which has about 200 workers today, has a market share of 45 per cent in Tanzania. About 99 per cent of the company’s sales are within the country.

However, the company will, within the next two months, start exporting its new high grade brand of tea to the US and the European Union.

He was, however, bitter about rampant smuggling of tea into Tanzania.

"Currently, about 35 per cent of the tea sold in shops in the country is smuggled into the country,’’ he said. This denies the government revenue in the form of taxes; and will also eventually cripple the local tea industry due to unfair competition on the market, he said.

"We currently pay a total of Tsh 316 million to TRA (Tanzania Revenue Authority) in the form of taxes; (but) the government earns nothing from smuggled tea. This is ridiculous. The government must act on this," he said.

He stressed that TATEPA was not against – or afraid of – competition. "All that we are asking for is a level playing field."

May 22, 1999


It will soon be the tide of Tanzania’s telephone companies to offer huge price cuts in call and connection charges, and begin spending a lot on advertising as the first clear signs of a marketing battle are expected to emerge any time now.

It was Uganda’s turn last October. Cartel Cellular which had set up the first mobile telephone company in Uganda three years earlier – with a connection charge of USD 300 – had to reduce it to USD 50! This translates into an incredible reduction of 713 per cent!

And, Ugandans know why the steep price fall was inevitable. A South African phone company, MTN Africa, made a debut on the Ugandan market with very competitive rates, tailoring tariff packages to suit the different market segments.

That South African phone giant will at any time from now establish itself on Tanzania’s market. The process of getting a license to operate the cellular phone business is said to be at an advanced stage. It has applied to operate as MTN Tanzania Limited.

The company plans to move into the Tanzanian market with digital mobile technology. Tanzanian’s telecommunications policy stipulates that companies wishing to carry out a mobile ‘phone business in the country should go digital.

MTN marketing communications manager, Sharon Hodges, told Business Times: "MTN Tanzania wishes to introduce world class technology and quality services at rates that are affordable to its prospective customers in Tanzania".

More interesting in the new venture is MTN’s tariff policy, which is set to be competitive and make mobile phones no exclusive luxuries for the well-o-do in urban areas only.

Hodges said MTN Tanzania Limited will require customers to only subscribe monthly at a fixed rate, subject to the package includes network subscription fee, air time call charges, value-added services, subscription fees and an interconnect of ‘toll’ fees.

Said Hodges: "Even though a customer might only receive calls, he does not pay for the privilege of being mobile – or staying connected to the network."

The proposed tariff structure will make a unique shift in mobile phone tariff policies in Tanzania. So far, only two companies are licensed to operate in the country.

The companies are MIC, which trades as Mobitel; the other is Tritel. The former uses analogue technology, contrary to the country’s obtaining policy. However, the Tanzania Communications Commission has given Mobitel up to the year 2003 to go digital – or suffer licence withdrawal.

Both companies charge customers a dollar per day for the privilege of being mobile, or staying connected to the network.

MTN has earmarked a minimum 30 per cent local share holding, whose main role will be to contribute specialized local market knowledge in mobile services.

MTN’s long-term strategy is to cover 56 per cent of the Tanzanian population in its fifth year of operation.

Part of the strategy will be the implementation of commercial pay phones in Tanzania’s under developed areas as they get network coverage.

Hodges said one MTN’s licence is signed, it will only take half a year to start operations in the country.






TANZANIA has been awarded its outstanding leadership within the Africa Travel Association during the just-ended Africa Travel Congress in Accra, Ghana.

Tanzania, which hosted last year’s Africa Travel Association (ATA) annual congress and trade show in Arusha, was praised by Mira Berman, the New York based ATA executive director, for having successfully organized the conference – which was described as the best ever since ATA was established twenty four years ago.

It was a moment of jubilation and applause from delegates as the Tanzania delegation, led by the minister for natural resources and tourism, Zakia Meghji, went in procession in front of conference delegates to receive the award.

The award, which is a shield with an inscription of the African continent made out of 20-carat gold, with the legend reading: Outstanding leadership within the Africa travel Association, was presented to Tanzania at the 24th International Congress in Accra late last week.

Tanzania, which has been singled out of the entire Association’s membership for its dynamic inspiration and rekindling the ATA membership, was also praised for having proposed the continent’s theme: Africa: Tourist Destination for the Next Millennium.

The theme, which featured at last year’s ATA Congress in Arusha, has now been adopted by all members as a way of publicizing Africa in the world’s tourist souring.

In the country recognizing Tanzania’s leadership in the ATA and WTO’s Commission for Africa’s Tourism, was also unanimously elected to the position of vice-president of the ATA.

Before that, Tanzania held a directorship in the Association.

During the Congress, Minister Meghji held several discussions with American delegates in aimed at establishing joint efforts to promote Tanzania in North America.

Among other promotional activities agreed for immediate implementation were advertising, educational tours and a promotional trip to the USA and Canada.

The Tanzania delegation visited the Cape Coast region of Ghana to tour the Kakum National Park, and the Cape Coast, which had been the first capital of what was then the Gold Coast: today’s Ghana.

May 15, 1999

East and Central Africa to Celebrate millennium legacy

EAST and Central African countries will on December 18 this year celebrate the 2000 millennium legacy on cultural aspects.

Dr. Peter Kilaka, a Nairobi based consultant in international relations, said in an interview recently in Dar es Salaam that the purpose of the millennium celebrations was to make people prepare something concrete to the subregion for the coming millennium.

Kilaka said the awards will amount to Tshs 87 million. The celebrations which will involve more than 25 awards ranging from Tsh 500,000 to Tsh 5 million, depending on the type of cultural activities performed by participants.

The celebrations, to draw participants from Kenya Tanzania, Uganda, Rwanda and Burundi, will be examined in aspects like the best millennium song, music group, model, actor, inventor discoverer, scientist, mathematician, farmer, conservationist, doctor and architect.

Other awards will be given to best administrator, educationist, road constructor, electrician, technologist, secretary, economist, student, novelist, and other 975 items.

The awards will also involve material awards like television, cars, computers, furnished houses, scholarships, bicycles, video cameras furnished beauty saloons, sewing machines, radio cassettes, fridge, gas cookers, electric cookers and dining sets.

Mode of cultural celebrations involves talking to the press media and each country to have its own panel who will provide the names of millennium achievers.

Interested people will be provided with the millennium guide for them to get detailed information and venue of the celebrations which will be announced later even though people have suggested it to be convened in Arusha.

May 8, 1999

Tanzania’s Tourist Industry: The Search for Efficiency, Hospitality

IN Tanzania today, tourism is something of a sacred cow: It is accepted as an economic boon, and a valuable source of foreign exchange- The Standard (Tanzania, May 25, 1970).

There is no doubt that the validity of the above statement still holds water today: tourism is at the forefront in contributing to the national economy, enabling it to earn foreign currency.

In a message from the minister from natural resources and tourism, Zakia Hamdani Meghji, that commemorated the World Tourism Day last September 27, the minister noted in part:

The tourism industry is one of the most important service activities in the economy of our country.

Available data for last year shows that 359,096 tourists visited Tanzania; and tourism receipts were US 392.41 million in current dollar terms.

The tourism industry since 1995 continues to grow, with an average annual growth rate of 11 per cent terms of tourism arrivals; and 27 per cent in tourism receipts

It is encouraging that the tourism business contributes a lot to wards building a sustainable economy. Hence, tourism is not a bad choice for one to invest in.

Tanzania is endowed with diverse potential favorable to the thriving of the tourist industry. In the words of President Benjamin Mkapa in a speech delivered at the opening of the International Investment and Technology Forum at the Sheraton Dar es Salaam Hotel in the city last November 5:

" With respect to tourism, Tanzania has one of the richest and most diverse habitat, plant and animal species. The Government has set aside about 25 per cent of the total Mainland area as protected areas (the largest in sub Saharan Africa); and various beaches constitute the major tourist base for developing and promoting different tourist activities ranging from game viewing safaris to photographic safaris. The continuing construction of private commercial tourist enterprises (such as hotels and tour operators) has resulted in the marked increase in capacity: the number of beds, chartered aircraft – and in the quality of services offered".


While Tanzania is a country of abundance as far as the tourism industry is concerned, let it be noted that the country is not alone in the industry. In fact, tourism is a worldwide business; and that is why there is established a global tourism body, the World Tourism Organization (WTO). Tourism is one of the largest industries in the world.


It is apparent, therefore, that there is stiff competition in the tourism business. Hence to woo as many tourists as possible, extra efforts are called for. For this to be achieved, those involved in the business must strive to improve services, efficiency and hospitality to the standards acceptable to prospective tourists.

In their endeavours, they should look for strategies, and management designed to leave no room for inefficiency. By so doing, we hope, tourists would make a beeline for Tanzania as their destination




THE Government of Tanzania had, in March last year, approved a wildlife policy which, among other things, focused on the involvement of local communities in conservation of wildlife resources. BUSINESS TIMES Corespondent DENNIS MASACY discusses that policy.


THE TANZANIA government in 1997 saw the need for greater involvement of the people in the management of natural resources, especially local communities adjacent to, or within the areas of the resources.

According to the Bagamoyo district commissioner, Philemon Shelutete, however, involving local communities in conservation has its difficulties; and rapid change should not be expected.

"In a situation where one day a wildlife guard is pointing a gun at a villager to keep him out of the resource area, and the next day the same guard calls on him to assist in managing the same resource is expecting too much, too soon," he said. Shelutete was speaking at a road-table discussion held in Bagamoyo recently on how to implement the policy.

Going by the district commissioner’s remarks, the natural resources department has a lot to do; including training of their guards to change their old attitudes towards the villagers. Without enough training, the guards will continue to harass villagers.

He said that, in the wildlife sector, for example, some early sings of success appeared in the Serengeti Regional Conservation Strategy (SRCS) project; and this showed both managers and the people what was possible; and what benefits there were that could be shared.

Shelutete went on to say experience has shown that, in most instances, the exclusion of the local community in the past contributed to management difficulties in natural resources, as exemplified in poaching, forest fires and other abuses, coupled with operational costs.

"Against such a backdrop, success would be difficult to achieve. Therefore, a more viable alternative was urgently required: a situation which led to the evolution of a policy regarding the management of wildlife resources," he said.

In the post-independence era-up to 1997 - the tools for environmental protection were rooted in colonial policy which was aimed at protecting natural resources from the people.

Recent social, economic and political realities have, however, led to the emergence of a different policy that of working with the people (rather than against them) in policing and co-managing resources.

The minister for tourism and natural resources, in a speech to the National Assembly in 1997, outlined the new goals and strategies of the ministry with regard to the major policy shift: from working against the people, to working with them!


The ministry had recognized that success in natural resources conservation would greatly depend on the extent to which the government gave power to the people to manager conservation and, at the same time, benefits from such natural resources.


However, the problem still persists; because, many people in the areas with natural resources have not yet been educated and mobilised enough to see the importance of environmental and natural resources conservation. It is a well known fact that many people contribute to destruction of the environment and bio-diversity out of ignorance.

Prof. Athanas Kauzeni from the Institute of Resources Assessment (IRA) at the University of Dar es Salaam said efforts have been made to share the proceeds from natural resources with the local community; but the 25 per cent share is considered inadequate.

He suggested that all the proceeds be given to the local community involved; and the district authorities should tax the villagers on that income.

He said while cultivators are being evicted from the Ngorongoro Crater, pastoralists are coming in - with some of them coming in from neighboring countries!

There has been a tendency to blame cultivators for deforestation; but even some Maasai are harvesting timber from the conserved areas for commercial purposes, including exporting same to Kenya. They also cause bush fires as they collect honey.

Prof. Kauzeni was of the idea that all and sundry should be monitored; and that we should take a historical perspective to the problem. Besides, he said, every body has the freedom and the right- to move!

He said it is necessary to listen to different stakeholders - including management-to get a balanced picture. There is a need to differentiate between policy, and its implementation. The issue is to assist the local communities to mange resources within their localities.



Govt. forgets to grade hotels


KENYAN hotels are graded, contrary to the Tanzanian government’s insistence that no hotel grading is being done in East Africa on the basis of star classification!

Although the Tanzanian media have been quoting government officials as saying East African hotels were not graded, Business Times has found out that grading of hotels in Kenya is done by the Kenya Association of Tour Operators (KATO).

Charles Otieno akal, a reservations officer with the Sarova Hotels Inn in Kenya said in a telephone interview that classification of hotels in his country boosts tourism. This is because it engenders vigorous competition among the hotels - in an effort to excel and, so, ensure that they remain within their star-grading.

Akal said Kenyan hotels have been graded from one to five stars. Of course, there are also hotels, which do not have star-grading at all. Classification covers hotels, lodges, resorts and tents; and a five-star grading denotes an establishment of the highest international standard. A hotel is given a star status, akal said, on the basis of its design, location, excellence of facilities - and if it has well trained and competent staff.

The grading of hotels, he said has increased the number of tourists to Kenya. And, once tourists complain about a certain hotel, KATO ensures that the allegations are looked into accordingly.

Contrary to the situation in Kenya, Tanzania’s hotels are unclassified; and complaints from tour operators and tourists largely remain attended to.

Edward Mbwiga, acting director of the Tanzania Tourist Board (TTB) says the Board is facing problems in winning over more tourists, as they always prefer to go to classified hotels.

He said: "Our role is to promote tourism in the country. But it becomes difficult to convince tourists to visit Tanzania - especially when they ask for graded hotels in the country. And, classification should not be confirmed to hotels alone; tour operators have to be classified, too".

He said if Tanzanian hotels and tour operators were classified, it would be easy for TTB to promote tourism.

"TTB would like all hotels and tour operators to be graded so that Tanzania can readily attract many more tourists," he said.

No ready answer was forthcoming from the ministry of tourism as to whether there were plans afoot to classify hotels and tour operators in the country. Ministry officials insisted that a questionnaire be formally submitted to the ministry first!

Evodi Mallya, the managing director of Hima investments, lamented that, because tour operators are unclassified, unregistered, pirate operators enter the business on the sly, thereby adversely affecting qualified ones.

"Unregistered tour operators do not pay government taxes, or fees to operate the business. And, in order to attract customers, they lower charges for their operation, seriously affecting, those who pay taxes and fees, he said. He wants the operators graded anon.

He said: "Tourists like quality services. Therefore, with grading of tour operators, more tourists will be attracted to Tanzania"


May 1, 1999

Dar IT equipment import duty highest in EA

Tanzania’s rate of import duty on information Technology accessories is the highest in East Africa marking most Tanzanians unable to by such equipment.

This is contrary to the government’s announcement that intends to equip its people with tools relevant to the 21st century needs, whereby the development of science and technology will be stressed.

IT equipment sellers have raised concern whether Tanzanians will afford to buy the requisite equipment if import duty rates on it is not lowered.

An imported piece of computer is charge 20 per cent of its value as import duty; and another 20 per cent as value- added tax (VAT) These are in addition to shipment cost – all of which push up the cost of the item.

Import duty in Uganda was reduced from 20 to 15 per cent ad valorem last year. On the other hand, Kenya has the lowest import duty rate in East Africa. VAT rates in both Uganda and Kenya are also lower than the rate that is applied in Tanzania.

Many IT consultants interviewed by Business Times say Tanzania still lags behind in information technology because the government and other related authorities still regard IT as some thing of luxury, rather than a necessity to be acquired as much as possible so as to cope with the blowing winds of change in science and technology.

"USA is a rich country, And a computer is a sold at USD 1,000. But, for a poor country like Tanzania the same computer is sold at USD 1,840 or more," observed the managing director of one of the leading computer centers and consultancies in the country who requested not to be identified in the press.

Another consultant who owns a computer sales and training center in the city center said. "High taxes have led to non-registration of many computer centers and high fees for computer courses in the county".

"Our fellow consultants - such as the University of Dar es salaam are given computer through aid, free of charge or sometimes, at subsidized prices. That’s why they manage to charge lower fees for computer student compared with us’’, the consultant said.

The consultants complaints have come amid government warnings that it will take stern measures against unregistered computer college.

Condition pertaining to the registration fee of Tsh 30,000; decent premises; appropriate and suitable facilities, and a relevant and approved computer curriculum.

However, most IT consultants said there are a lot of taxes to be incurred in the course of establishing and registering a computer college leave alone the cost of purchasing appliances from overseas, as well as training and operational costs.

Aliraze Jessa, a computer sales and services manager, said in an interview that rates of important duty in the country were overwhelming, forcing service providers to raise prices to compensate for the taxes.

He requested the government to reduce import duty rates for IT equipment so that the country can prepare itself in the coming millennium.