OPENING REMARKS BY H.E. JAKAYA MRISHO KIKWETE, PRESIDENT OF THE UNITED REPUBLIC OF TANZANIA AT THE PRESIDENTIAL ECONOMIC COMMISSION MEETING BETWEEN UNITED REPUBLIC OF TANZANIA AND THE REPUBLIC OF SOUTH AFRICA, KILIMANJARO KEMPINSKI HOTEL, DAR ES SALAAM, 5 TH APRIL, 2007 Your Excellency Thabo Mbeki President of the United Republic of South Africa; Honourable Ministers; Permanent Secretaries; Distinguished Guests; Ladies and Gentlemen, I would like, first of all, to welcome you, Comrade President, to Dar es Salaam and to this session of the Presidential Economic commission. We feel delighted and greatly honoured to have you visit us again six days after SADC Summit. We heartily welcome you and your distinguished delegation. Tanzania is your second home away from home. Many in the South African delegation know their ways in Dar es Salaam, they need no guidance from any one. Please feel free and enjoy your short stay.
Your Excellency, Tanzania and South Africa have a long standing relationship. The relationship dates back to early days of the independence struggle when our two peoples fought together for our freedom and independence. We are now free and independent. As independent nations the overriding challenges is nation-building in the sense of realising the aspirations of our people who supported the struggle. The great revolutionary champion born of Guinea Bissau, the late Amilcar Cabral once said people don t fight for ideas but for material gain. He was speaking about the people of Guinea Bissau during the struggle against Portuguese colonialism. But, this is true of all us in the Continent and beyond. The gallant people of South Africa and Tanzania are awaiting the material gain expected to follow their liberation from colonialism and apartheid. Indeed, these gains are realized through economic growth and development of our economies and equitable distribution of the wealth so created. Cooperation between our two countries is essential in this regard. The Presidential Economic commission established in September, 2005 is the right mechanism for promoting stronger cooperation on the economic front. This second meeting dedicated
to discussing and agreeing on the plan of action and concrete steps to be taken in pursuit of this noble objective is very welcome indeed. Comrade President; Ladies and Gentlemen; Fortunately, the state of economic and trading relations between our two sister republics is encouraging. Nonetheless there is room to do a lot more. Indeed, this meeting is meant to discuss what more needs to be done. Our two countries have made tremendous strides in trade and investment in a very short period of time. Available statistics show that the volume of trade between the two countries has increased from US$ 314.9 million to US$ 696.3 million between 2003 and 2005. Specifically, Tanzania s exports to South Africa increased from US$ 38 million in 2003 to US$ 292 million in 2005. Similarly, Tanzania s imports from South Africa increased from US$277 million to US$404 million over the same period. These figures serve to demonstrate that South Africa has increasingly become a significant and thriving trading partner of Tanzania. Indeed, there is trade imbalance but this is manageable as long as Tanzania manages to solve the supply side constraints. South Africa is a huge market with tremendous effective demand to consume as much as Tanzania produces. I am glad that facilitating investments
from South Africa is one of the objectives of this Presidential Economic Commission. South Africa is the fifth largest source of foreign direct investment to Tanzania after the UK, Kenya, India and China. Statistics show that between 1990 and 2006 investment flows from South Africa reached $ 467 million. This accounted for about 10% of the total investment flows to Tanzania during that period. Comrade President; There are more than 150 South African companies of different sizes now operating in Tanzania. These include Anglo-Ashanti Gold which operates the second largest gold mine in the country, AFGEM which is the largest producer of Tanzanite, and Tanzania Breweries Limited - a subsidiary of SAB Miller of South. The Tanzania Breweries Limited happens to be one of the largest taxpayers in Tanzania. There is also the Illovo Group of Companies who own the Kilombero Sugar Company. Comrade President; Ladies and Gentlemen; Tanzania welcomes more investments from South Africa. I know there is surplus capital that seeks lucrative opportunities which Tanzania has a lot to offer. I would like to assure you that
the Tanzanian government continues to make significant strides in creating a more suitable climate for investments, both local and foreign. We have been taking measures to improve on the investment climate so as to attract more and more investments into the country. We have been taking measures to reduce the cost of doing business in Tanzania with considerable success. I am sure, the pioneer South Africa companies operating here will testify to the fact that things are improving. I know there are still hurdles to overcome, a matter we are resolved to do. We are actually continually doing. We are open for dialogue as we always do. And, we have a receptive ear, the business people know it. I appeal for your word of encouragement to South African investors to look at Tanzania as a prospective and attractive investment destination. Your word would mean a lot. Comrade President; Tanzania still faces a number of challenges which if overcome, would go a long way towards releasing the vast investment potential. Among the most urgent ones are energy, infrastructure, ICT and human resource capacity. The government is doing its part in ensuring that these constraints to development are overcome. It is for this reason that we see opportunity in this Presidential Commission. Working together with your great nation which has such vast capacity and experience will be helpful. We may get wise counsel on how best to manage the difficult circumstances including
how to access resources to implement some of the projects and programme. Fortunately, most of these issues are the subject of our meeting. The discussion on the Spatial Development Initiative areas, namely Mtwara Development Corridor and Central Development Corridor, where South Africa has already been seriously engaged in their development is quite befitting. We strongly believe that development of infrastructure in these areas is bound to increase both trade and investment opportunities for companies from South Africa, Tanzania and elsewhere. Ladies and Gentlemen; As a way of qualifying what I am saying, allow me to give a few examples. Tanzania has deposits of coal in the Southern Highlands at Mchuchuma and Kiwira. There are as well huge deposits of iron ore in the same location. Tanzania would require a small proportion of these resources for domestic use whilst most can be exported to South Africa were there is big demand. We need to develop infrastructure particularly roads and railways to link the mining areas with the ports of Dar es Salaam and Mtwara. Similarly, the benefits of availability of reliable railway and road infrastructure linking Tanzania and the neighboring states such as Uganda, Malawi, Zambia, Rwanda, Burundi and Eastern parts of the Democratic Republic of Congo needs no further qualification. These are countries that are landlocked whose external trade is dependent on
Tanzania to a considerable extent. Because of its strategic location Tanzania serves as the gateway to the Great Lake Region. The infrastructure projects that I have just cited above also have a great potential to pull agricultural and non-agricultural investment into the virgin TAZARA, Mtwara and Central development corridors. Your Excellency; Tanzania also has a great potential to generate hydroelectricity. One outstanding site is the Stiegle s Gorge located on Rufiji River. If this project was to be developed it has the potential to produce between 1,000 and 2,000 megawatts. At the moment Tanzania does not need so much power. The existing sources and others are quite adequate now and in several years to come. Tanzania can develop these sources if there is external market for the power to be generated. If South African needs this power, let us work together to develop the site. Your Excellency; Tanzania welcomes South African Government and South African private sector to come and work with us (in government and private sector) to tape this huge potential for the mutual benefit of the people of Tanzania and their brothers and sisters in South Africa. I know South Africa has the competence and capability to do so. Let this meeting serve that purpose.
Your Excellency; Distinguished Guests; Ladies and Gentlemen; This meeting is a major milestone in deepening and broadening the economic and trading relations between our friendly nations. I am glad that we have been able to convene this meeting. I have no doubt that we will rise to the expectations of the brotherly people of South Africa and Tanzania. With these few remarks I now have the honour and pleasure to declare our meeting open. You are cordially welcome. I thank you all for your kind attention.