BUSINESS NEWS
|
BUSINESS NEWS |
I-T industry upbeat after Windows 2000 launch
By Costantine Muganyizi
Software giant Microsoft of the US, last week touched a new milestone in the development of the information technology (IT) sector in the country when it included Tanzania in the world-wide launch of its latest product, Windows 2000.
It is the first time Microsoft has launched a product in Tanzania and the first-ever international class IT product launch to be held in the country. The IT Association of Tanzania (ITAT) has welcomed the development saying that it signifies a bright future for the industry.
"To me this means that the IT market in Tanzania is becoming more mature," ITAT's Secretary General, Jayesh Ganatra told The Express. "The amendment of the copyright laws, which made software piracy illegal in the country, has played a great deal in this," he added.
Ganatra who is also the Managing Director of Micronix Systems Ltd. said that it is the legal and fiscal changes that were implemented last year that have evoked the interest of Microsoft and other IT manufacturers in Tanzania. Director Shabbir Salemwalla whose Institute of Information Technology (IIT) will next month launch a Windows 2000 training course said Tanzania is now vividly marked on the world IT map.
"As far as training is concerned you could now receive in Tanzania IT skills and expertise that are on par with other parts of the world," he noted. " As a Microsoft Certified Technical Education Centre, IIT will provide Windows 2000 training through Microsoft official curriculum using instructor-led material and this we will do starting April 2000."
According to Microsoft guru Bill Gates, Windows 2000 is more reliable, more scalable and easier to deploy, manage and use than previous versions of Windows. The Windows 2000 platform significantly reduces costs, enables a new generation of applications and provides a solid infrastructure upon which to build an organisation's digital nervous system, a senior Microsoft East Africa official said at the launching ceremony in Tanzania.
Microsoft business development manager for East Africa, Louis Otieno, told the launch gathering at the Sheraton Dar es Salaam Hotel that the USD three billion that was spent to develop Windows 2000 sought to basically meet four goals. These are reliability, manageability, Internet scale, security and services as well as support for new devices and mobile users.
The Express has reliably learnt that the software took 10 years to design and over another five to develop involving 3000 developers. According to Otieno, the new Microsoft Windows 2000 product line comes in three versions tailored for different levels of users: Windows 2000 Professional, Windows 2000 Server and Windows 2000 Advanced Server.
Noted Otieno: "Windows 2000 is a customer-feedback, quality-driven product. It is the result of massive customer and partner feedback and it is the most widely tested product in the history of Windows software development. We expect the migration to Windows 2000 to produce a significant savings in administrative time and an increase in productivity and the dramatic return on investment."
Ganatra said Micronix already has stock of the software whose price he put at a minimum of USD 300 per package. The company is one of the three authorised Microsoft solution providers in Tanzania. The others are CATS and Computer Centre.
New Mwanza RC promises removal of irksome fish levies
By Peter Ambilikile recently in Mwanza
The new Regional Commisioner for Mwanza region, Mr Stephen Mashishanga, has agreed to remove some of the unnecessary levies imposed by the authorities on fish processing factories so as to create favourable conditions for the industry and make it more competitive.
Mr Mashishanga said the complaints by the fish processing factories could not be left unheard and that efforts would be made to address their grievances.
Mr Murtaza Aloo, a director of VICFISH Ltd, said untenable tax rates, poor electricity and road infrastructure, had resulted in the country faring badly in fish processing area, compared to its neighbours. He said it was time the government removed all unnecessary levies imposed by the Mwanza Municipality. The levies in question are the processing levy of 0.3% and taxes imposed by the islands where the vessels catch fish.
For example, in Ukerewe, the factories pay 5 to 7 shillings on one kg of fish catch, which goes to the Ukerewe municipal council, while on the arrival to the Mwanza port again the Mwanza Municipality charges 7 to 10 shillings levy on the same catch. Mr Aloo complained that the freight on board of 6% was also very high.
The regional commissioner has promised to have a joint meeting with the fish processors and the Municipal Council.
Complaints by the fish industries come at a time when they are trying to secure the lost market following the European Union ban on fish from Tanzania slapped in December last year. In East Africa, only Tanzania remains free from the ban.
Mr Winton Mwasa, chief officer of MV victoria plying between Mwanza and Bukoba ports, said the ban was a lesson to fishermen. He said almost all the fishermen had abandoned their boats during the ban as prices went down to 150/- from 350/- per kg.
By Dean Great
AKIBA Commercial Bank Limited (ACB) will from April this year start giving out macro loans to medium scale traders after the bank registered success in group loans for small scale traders.
The Bank’s managing director, Dr Idris Rashidi, told this paper in an interview that the positive response the bank received from small traders had prompted it to extend its loan capacity to medium scale traders.
“The response from people was extremely encouraging and we see it is the right time to loan the medium traders,” the former Bank of Tanzania (Bot) governor pointed out.
He said borrowers in this new credit scheme would be able to secure a loan of Tsh 400,000 to 5,000,000. “The targeted people in this scheme are shopkeepers of spare parts, dispensaries and other related businesses,” Mr Rashidi said.
The Department for External Development (DFED) has given US dollars 15,000 to ACB for the programme. The Bank hired an expert from United States to facilitate the project. It will use its Manzese branch and send agents all over Dar es Salaam region to mobilise borrowers. “Akiba wants to be a bank which goes to look for customers and not to stay in the office awaiting them,’ Mr Rashidi said.
The programme to lend small scale traders started September last year at the Manzese branch in the city. So far, about 691 small traders have received loans worth Tsh 116.5 million.
Mr Rashidi said that in the next three weeks his bank would remain open seven days a week at the Manzese branch so as to meet the demand of the customers. ‘Many people from neighboring regions have been writing us for the need of service but we are unable to reach them,” he said.
The bank plans to start offering loans next month.
ACB has recently received Tsh 160 million from the Royal Netherlands Embassy for a five-year expansion plan. “We expect to open more branches in the country to serve more people,” Mr Rashidi said.
Branches will be opened in Arusha, Mwanza, Kilimanjaro and Mbeya regions. According to Mr Rashidi, the programme will be ready next month to be taken to ACB board for further discussion. ACB is owned by over 260 individual and institutional shareholders.
Nation in precarious position over debt
By Timothy Manasse
Tanzania's external debt at the end of 1999 stood at USD 7.2 billion, while its total exports for the same year were worth USD 538 million only. Of the total foreign debt, 40 per cent is owed to multilateral creditors and 40 per cent to bilateral donors. This has created a need for debt retirement, budget deficit reduction and acceleration in economic growth.
A UK-based Treasury Economist Razia Khan, speaking recently to clients of Standard Chartered Bank (SCB) at a breakfast meeting, said, one of the most important components directly linked with serving of foreign debts was the rapid growth of the economy which, in Tanzania, was hindered by poor infrastructure including poor road conditions, costly electricity and inadequate water.
Ms Khan mentioned other factors hindering the economic growth as heavy expenditure in foreign debts servicing, now four times the funds used in primary education and anti-market culture.
Speaking on the recently established East African Cooperation (EAC), Ms Khan said all member countries would benefit from trade liberalisation although she Kenyan industries would
dominate. "But following trade liberalisation, South African investors see Tanzania as a gateway to East Africa and the real impending danger is that Tanzanian consumers would end up paying more for lower quality imports within the region," she said.
She said, in order for the country's economy to grow smoothly, taking into consideration the prevailing privatisation process, there was a need to move away from agricultural dependence and pave way for prioritisation of projects.
She advised a slow economic growth but an increase in national domestic savings to 7 per cent of the GDP and investments rate of above 20 percent of the GDP.
and investment aid that currently stands at 90 per cent should be brought down.
Khan mentioned gold as one of the minerals which can play a vital part in boosting the economic growth of the country, saying, once full scale production begins, the commodity will comprise 50 per cent of the total foreign exchange earnings.
"The mining sector will add between 1.8 and 2 percent to the future GDP although mine development spending will increase to USD 400 million, while both exploration and extraction costs fall," she said.
Wood workers, food processors to receive training
By Dean Great
ABOUT 500 small scale entrepreneurs in Dar es Salaam will be trained in metal works, wood works and food processing by the Dar es Salaam Petty Traders Association (VIBINDO) from the March to December this year.
VIBINDO General Secretary Gaston Kikuwi, told this paper the training programme would last three weeks. The subjects to be taught were business management, marketing metal works, wood works and food and fruit processing.
Mr Kikuwi said that the objective of the course was to impart petty traders advanced knowledge in their fields. “We are going to train the people who are already in these fields and not newcomers. However, the trainees must be members of VIBINDO society,” he said.
Mr Kikuwi said the training project would be implemented in collaboration with the Tanzania Industrial Research and Development Organisation (TIRDO) and Small Industrial Development Organisation (SIDO). The facilities available at TIRDO will be put at the disposal of the project.
Kikuwi said food processors would be trained on four products, namely oranges, pineapples (juices), tomatoes (puree and ketchup), mangoes (juices and pulp). “We will also identify, design and fabricate appropriate food processing equipment. The fabrication will be done locally with the supervision of TIRDO."
The wood workers will focus on drying, kiln drying of the wood using solar, saw doctoring with elements of training on wood grading, classification for strength of products as well as finishing of wood products, including lacquer and stains to be used.
VIBINDO is a registered as a self help organisation. Nevertheless, it will require some external assistance to effectively support its members and carry out its programmes. The project will assist VIBINDO in establishing common production facilities for food processing, including the design and fabrication of food processing equipment and for wood working products.
N. Ireland delegation arrives in Dar
By Stella Sebastian
Tanzanian business persons and officials will once again have a chance to interact with their counterparts from Northern Ireland who are in Dar es Salaam on a four-day business tour.
According to a press statement released by the Department For International Development (DFID) at the British High Commission in Dar es Salaam, senior managers from four Northern Ireland companies are in the country to explore trade and other business opportunities. A similar delegation was in the country two years ago.
The mission has, according to the statement, been organised by Trade International Northern Ireland with the support of the British High Commission in Dar es Salaam. Trade International is the export and trade division of the Industrial Development Board for Northern Ireland (IDB), the main investment and business development body in the region, which is part of the United Kingdom.
The delegation, which is led by the IDB Chief Executive, Bruce Robinson, includes companies involved in the construction sector, including Civil and Structural Computer services, a specialist in software for the building industry, and Kirk Morton and McClure, one of Northern Ireland's leading project management and building engineering consultancies.
According to Mr Robinson, Tanzania is among the most important developing markets in East Africa. "We are keen to develop trade links with the country and to identify opportunities for the expertise which Northern Ireland companies possess in sectors such as construction, planning and environmental technology," he said.
Enabling Northern Ireland companies to build contacts with international aid agencies and key government officials involved in development projects is a key objective of the mission to East Africa.
"We believe that many local companies have the skills and expertise required to carry out aid agency contracts and we are keen to help access the very substantial business opportunities developing in Tanzania and other parts of East Africa," said Mr Robinson.
According to the statement, the Construction Export Group, which bagged a contract from Uganda during a previous Trade International visit to East Africa, in 1998 will be pursuing further projects in East Africa.
Credit Shops to grant loans worth 250m/-
By Stella Sebastian
Credit Shops, Dar es Salaam branch, one of Poverty Africa's programmes that aims at raising the income of the less privileged members of society, will this year issue loans amounting to Tsh 250m to more than 450 applicants.
Speaking to The Express last week, Credit Shops Executive Director, Mr Abbas Mursal, said the programme would also create a full time employment for about 1500 people.
He said up to January this year, the programme had issued loans worth Tsh 120m. According to him, the programme has120 active clients.
Poverty Africa is an NGO for Global Co-operation against Poverty in Africa, with offices in Nairobi, Kampala, Dar es Salaam, Zambia, UK and Canada. A number of programmes such as Credit Shops are registered as NGOs and affiliated with Poverty Africa.
Credit Shops programme which was established in 1995 and started operations in 1997 offers loans to groups of five and not individuals. The programme targets all people in the informal sector.
It plans to extend its services all over Tanzania and is currently operational in ten regions of Tanzania. These include Dar es Salaam, Dodoma, Tanga, Arusha and Kilimanjaro. Others are Singida, Iringa, Rukwa, Mwanza and Morogoro.
Among the programme's objectives is to remove barriers for small business operators who lack experience in dealing with financial institutions, insufficient capital and inadequate credit management experience, to instil the culture of borrowing and repaying loans to small scale entrepreneurs, to reduce unemployment and promote self employment, especially among the youth, women and disabled people. To generate and mobilise credit resources from domestic sources, to establish credit shops centres to serve the grass root communities in rural and urban areas.
Commenting on repayment of loans, Mr Mursal said repayment rate stood at 96 per cent. To avoid defaulters, peer pressure is used whereby other group members are the ones who guarantee their fellows.
"Our office may intervene where the situation is critical, and we normally involve grass root leaders," he said.
The programme's main sources of funds include members' contributions as well as funds from the African Development Foundation (ADF). According to Mursal, ADF has promised to offer TSh 80m for loan fund and Tsh 53m for capacity building, a quarter of which was received in December last year.
Funds for operation activities are generated through interest from loans, members interest fees and sale of passbooks.
Telecom industry feels need for mergers
By Stella Sebastian
A number of leading players in the telecommunications sector feel it’s time big companies merged in order to provide extensive services to the majority of Tanzanians. The steep competition seems to be taking its toll on the industry.
“I believe Tanzania is doing very well compared to other nations in the region in this sector and some level of competition will improve services even further,” said the Information Technology manager of a leading telecom company.
It is believed that in the very near future, data transmission will begin to be serious business for competitors venturing into this market.
According to the source, Tanzania will increasingly see data services provided by telecom operators as value-added services.
Tanzania is said to have too many operators in the sector. It has the largest number of licensed operators in Africa and many parts of the world and there is fear among customers that if smaller companies participate and are forced out of business, they may leave customers without a service, something akin to bank failures witnessed in the country.
When asked to comment on this, the Public Relations Officer of the Tanzania Communications Commission (TCC), Mr Mkumbwa Ally, said it was true that Tanzania, unlike any other country in Africa, had five operators in the sector. South Africa has three operators, Kenya has just licensed the second operator, while Uganda has only two.
The main operators in Tanzania are the Tanzania Telecommunications Company Limited (TTCL) for Mainland Tanzania and Zantel for Zanzibar. Licensed mobile phone operators include Mobitel, Tritel, TTCL, Zantel and now Vodacom.
Mr Ally said the reason why Tanzania had so many operators was that small operators were the first to come in. These, he said, could not cover a wide market as their capacity was limited. For instance, he added, some were using old technology while those with superior technology had limited investment.
In South Africa, where there are big investors the coverage is very wide and hence there is no need to bring in many operators.
“The point is not the number, but the quality and capacity of the investor,’ said Mr Ally. He said the teledensity in Tanzania was still 0.3 despite having so many operators.
Commenting on the possibility of failures in the sector such as what has been experienced in the banking sector, Mr Ally said safeguards were in place to ensure nothing of the sort ever happened.
“We demand statements of the companies’ accounts, details of shareholding and insist on participation of local partners who must own a substantial percentage of shares because we want the investment to have a local footing for the customers’ security,” said Mr Ally.
According to him, local participation in the telecom sector was about about a one-third of the total investment.
“As a regulator we satisfy ourselves that the licencee has sound financial footing,’Mr Ally
said. In addition to that, he noted, TCC monitors the operations regularly and also regulates the tariffs.
Mr Ally said TCC had laid down regulations to govern the service providers and make sure they were adhered to. For instance, he said, the operators must provide continuous services. In case of interruption for more than 24 hours in Dar es Salaam and 48 hours elsewhere, the operators are always taken to task.
Mr Ally said investment crunch was a major hurdle in the sector’s development. According to him, the sector required a huge investment which unfortunately could not be sourced locally. He said investment in the sector should focus on universal access and that modern and appropriate technology was needed to reach many people at affordable rates.
Mr Ally said the future of the sector was promising now that there were big players such as Vodacom. He said newcomers in the sector would create competition and that it was the customers who would benefit from lower tariffs.
Even war-torn nations do better than Tanzania in agriculture
By Godfrey Kambenga
The country's agriculture potential has remained largely unfulfilled due to political inaction, says the Chairman of Tanzania Exporters Association (TEA) Simone Mutabuzi.
In his paper entitled Marketing of Agricultural and Livestock Products, presented to the Tanzania Chamber of Commerce, Industry and Agriculture (TCCIA) in Dar es Salaam, Mr Mutabazi said agricultural sector, once regarded as the backbone of the country's economy, had been performing poorly for the past 39 of independence. with both food and cash crop production not doing well While agriculture contributes about 50 per cent of total country's exports , it does not generate enough foreign currency to back the country's balance of payments.
Although Tanzania is bigger than Kenya and Uganda, with a comparative edge over its neighbours, the agricultural sector in the country lags behind the other two East African nations, where agriculture contributes significantly to the national economies.
``Even the small land-locked countries in Central Africa, virtually always at war, are doing better than us,'' lamented Mr Mutabuzi.
He said one of the reasons Tanzania was not doing better in agricultural exports was the government distrust towards the private sector.
Giving an example, he said the Tanzania Exporters Association had identified external financing of 28.6 US dollars from Switzerland for a horticultural development project to cover 10 regions of the country. However, the government had so far failed to give a go-ahead to the Association. He said a project which cost 17,500 US dollars to finalise was at the moment languishing in the corridors of government offices due to bureaucratic red tape. Mr Mutabuzi said if agricultural projects conceived by the private sector had been approved by the government without unnecessary delays, agricultural exports would have jumped by 50 per cent long time ago.
Agricultural products earned the country 447.3m US dollars in 1996, USD 360.5m in 1997 and USD 345.6m in 1998, representing 53.3 percent of total exports.
| Business News | Forex Week | Money Market | Corporate Report |
| Business Opinion | Bank Interest Rates | Capital Market Focus |