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The government has been urged to swiftly review its tax legislations to allow local and multinational companies to heavily invest on agriculture sector, thus spurring economic growth.
Denmark Ambassador to Tanzania Mr Einar Jansen said at a REPOA-UN Wider joint conference in Dar es Salaam yesterday that the overly tax burden was slowing inclusive economic growth.
According to the latest World Bank Report on Doing Business, Tanzania slightly jumped to 132 from 139 in the previous rankings. Apparently, the economy has been growing significantly at an average of 7 per cent yet a vast population is still below the poverty line.
According to the envoy, Tanzania has great opportunity « which is fine for investors. But it is still tough doing business in the country. » He observed that there was still room for the country to move to a much better ranking simply by revisiting policy and tax legislation. He explained that a growth rate of 7 per cent is interesting for any investor to invest in the country.
However, he added agricultural sector seat on huge opportunities. In improving production, he said, Tanzania has over 25million head cattle. « This needs nice slaughtering houses to start exporting meet to European markets.
It also allows for establishing daily plants to produce milk and chess which can be consumed locally and exported abroad, » he noted. « All it takes is to have quality slaughter house, quality assurance and investment. »
REPOA Executive Director Mr Donald Mmari said the poverty level in the country did not reflect the current economic growth as a number of individuals in the agricultural and informal sector have not been reached.
« This slower efforts to eradicate poverty … The pace to reduce poverty is limited due to weak investments in the informal and agricultural sectors. » « There is a need to revisit the policy on how the government and other stakeholders can invest in the agriculture sector by reaching more small scale farmers to increase productivity, » he said.
He added: « The government and other actors should offer incentives, education, financial supports and proper areas for doing business to small businesses. »
The director explained that informal sector must be linked to the formal sector to improve the economy and promote social and economic inclusiveness.
The conference has brought together stakeholder to review various research done by REPOA in partnership with the UN-Wider University based in Finland.
Presenting a report on the Role of Effectiveness of Special Economic Zones on Industrial Transformation, a researcher from Trinity College, Ms Carol Newmen, said SEZs are vital for industrial development in developing countries.