Economic issues in Magufuli's Speech in Parliament: Part 3

On November 13, 2020 President delivered his inaugural speech in the 12th Parliament following the October 28, 2020 General Election. A number of issues were outlined in the 82-page speech which gives the direction of his second 5-year tenure of the Presidency. This article is part three of some key economic issues in that speech. Parts one and two were discussed on November 28 and December 5, 2020 respectively in this column.


The emphasis is similar to the one given when inaugurating the 11th Parliament in 2015. Needed are industries that will use domestic raw materials.

Agro-processing industries become the first choice. Others are industries that will produce for domestic market.

This calls for industries that can cater for domestic consumer behaviour otherwise consumers will be in favour of imported industrial good. The President wants industries that will produce mass employment. These are labour- as opposed to capital intensive industries.


However, industrialization involves many and long value chains and nodes not just factories.

Therefore the desired mass employment can be generated along the industrial and related value chains and nodes. Needed too are industries that will export excess production.

This calls for capabilities for export market access. It will add much value to thoroughly, objectively and critically evaluate industrialization process from 2015 to 2020. Lessons learnt should inform the 2020-2025 industrialization efforts.


Among the key issues in the speech is improving investment climate. Issues here include having good and predictable legal, policy and regulatory frameworks; good quantity and quality of hard and soft infrastructure; adequate talents, hard and soft skills in the labour market; friendly fiscal space and many more as listed in the World Bank’s annual reports on ease of doing business and OECD’s Africa Report as well as TPSF’s Business Leaders’ Perception on Doing Business in Tanzania.

The focus has been on attracting investments.

We need to also focus on retaining investments that have been attracted so as to avoid flagging out for whatever reason.

Participatory approaches that take into account general and sector-pecific investors’ views on investment climate issues are crucial.


The ultimate goal is ensuring that Tanzania does not lose the huge potential revenues embedded in the country’s immense minerals endowment.

Strengthening of the legal space around mining is among the strategies towards this noble goal.

The good thing is that Tanzania has vast experience on legal reforms in the extractives space that can be used for further win-win reforms.

There is also a focus on mineral deals negotiations. Experiences of successful negotiations exist.

However, in ensuring that we strike good deals, continuous negotiation capacity building is key in this very dynamic and lucrative sector.

Improving small scale miners is also in the President’s agenda and correctly so.

Domestic mineral value addition through beneficiation is also captured by the President. This is very important in avoiding exporting of raw minerals which is a bad deal for the country.

Exporting raw minerals imply exporting processing and related jobs, incomes to companies and individuals as well as government revenues in forms of taxes, fees, fines and much more along that line.


The ultimate goal is to generate more revenues from the sector. Strategies include improving the environment that will attract more tourists.

Over years emphasis has been on foreign tourists partly due to their relatively high spending power. containment measures including travel bans, lock downs and social distance among others have negatively impacted tourism. It has taught us the role of domestic tourism.

The need to ensure that there is attractive tourism environment in all aspects cannot be overemphasized. This include good infrastructure, diversified traditional and non-traditional attractions, affordability and most importantly peace and tranquillity.


Infrastructure projects have been among the landmarks of Dr Maguli’s first tenure.

This will be the case in his second tenure as well. They include roads, ports, airport, railways and electricity. These are very important in unlocking productive capacity of the country. Whereas much emphasis has been on the hard infrastructure listed above, the need for equally huge focus on soft infrastructure is huge.

There are huge values produced, transported, stored and consumed in such soft infrastructure as the Internet. The need for improving its quantity and quality, speed and safety cannot be overemphasized.


Honest Ngowi is Associate Professor of Economics at Mzumbe University and Principal of Mzumbe University Dar Es Salaam Campus College

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