Stakeholders have called upon the government to resort to the creation of agro-processing businesses and rural agro -based industries as a means of increasing revenues and reducing import bills through value addition. This call was made during the Policy Forum breakfast debate held on 27th January 2017, Dar es Salaam
Presenting a topic entitled “Revenues from the Agricultural Sector: How much is Tanzania Losing from the Sector?”, Mr. Audax Rukonge, the Executive Director of ANSAF said that most of the crops in the country are marketed in their raw forms, losing opportunities for higher earnings and employment creation. He said, Tanzanian processing capacity has remained very low, compared to its neighboring countries – such as Mozambique and Kenya because the country has not invested much in the sector in terms of production and productivity.
Rukonge said an average of 85% of cashew nuts produced in the country is exported as raw materials denying the country huge amount of revenue and other benefits because of its contribution to episodes of global supply shortages and strong swings in prices. Export from the sector contributes to an average annual loss of over USD 110 million, which could have been directed to building enough cashew nut factories to process the entire Tanzania cashew crops.
Tanzania loses a lot of its other revenues through the sugarcane, sunflower, hides and skin and livestock industry, Rukonge added. He therefore highlighted some key recommendations to address this as maintaining the checks and balances between the imports and exports of various commodities and supporting both farmers and processors access to credit, equipping them with management skills and technical expertise to enhance production and productivity.
Mr. Godfrey Kirenga, CEO of Southern Agricultural Growth Corridor of Tanzania (SAGCOT) called on the government to develop an industry that is competitive in the world market through supporting local agricultural industries/farmers.
Related to this call, the Executive Director of Tanzania Private Sector Foundation (TPSF) - Godfrey Simbeye pointed out that in order to ensure value addition so that agricultural products generate more income to the nation, the government should opt to address the issue of Value Added Tax (VAT) on the products locally produced.
During the plenary participants were of the view that resorting to agro processing will also mean supporting President Dr. John Pombe Magufuli in his industrialization agenda and the Second Five Year Development Plan 2016/17- 2020/21 which has the theme entitled “Nurturing Industrialization for Economic Transformation and Human Development” with the main objective of enhancing the pace of progress towards the Tanzania Development Vision 2025.
The debate offered opportunity to revisit the government’s Agricultural Marketing Policy that was issued through the Ministry of Industry, Trade and Marketing in 2008 to promote value addition in agricultural produce and address the challenges of crops in the country being marketed in their raw forms. The systemic issues highlighted during the event are expected to feature in future stakeholder dialogues to ensure the potential of agro processing to increase earnings through value addition is realized and that rural communities are offered moe employment opportunities.
Policy Forum holds the People and Policy Debates on the last Friday of the month to broaden public understanding and debate on a topical policy issue. Issues chosen for the breakfast debates are wide-ranging and speakers are drawn from the public sector, academia, civil society, donor agencies and the private sector, and the talks are open to the public and attended by interested individuals and professionals.