Oct 3, 2022

Mawazo Writing Africa

Writing about the main

Samia’s goody package to woo Ugandan businesses back to Tanzania

President Samia Suluhu is pushing for a return of Ugandan traders and investors to Tanzania with a variety of incentives including tariff cuts, investment in transport along the Central Corridor and the removal of trade barriers that have kept businesses out of the Dar es Salaam port.

President Samia, on a two-day state visit to Uganda this week, also sought to cement Tanzania’s newly acquired position as the region’s leading exporter to Kampala, replacing Kenya.

Uganda’s imports from Tanzania were worth $743.68 million in 2020, the highest in years, and far more than any other regional country, but Samia is aiming for more.

Speaking at a business summit of Ugandan and Speaking to the Tanzanian private sector, the Tanzanian leader said her government is addressing key issues that have hampered trade between the two countries, including he tariff and non-tariff barriers to trade (NTBs), bureaucracy and high transportation costs.

Uganda’s Private Sector Foun The organization’s chair, Elly Karuhanga, said the barriers have cost money and many jobs.

“We want to use the port of Dar es Salaam but we are being charged almost 10 times more than anyone else in the region,” Mr Karuhanga said.

But President Samia and her entourage, including ministers and officials of ports, railways and sea authorities, assured better trading conditions.

“We heard you,” President Samia said: “Your complaints and concerns… believe me, we are working on them.”

Following her meeting with President Yoweri Museveni at State House Entebbe, it was announced that freight going to Uganda Trucks from Dar es Salaam to Mutukula will pay $10 per 100 km from next fiscal year, less than the $500 they currently pay pay.

The two leaders unite also announced that from July Uganda will supply 10,000 tonnes of sugar annually to meet Tanzania’s current deficit.

According to a joint communiqué, the Presidents instructed them r ministers meet frequently to address NTBs and within one month to find solutions to challenges related to bilateral trade.

Uganda manufacturers want the two countries to accelerate construction of the planned natural gas pipeline from Dar es Salaam to Kampala to meet part of their energy needs .

“We are in talks about the route,” said President Samia. “Uganda wants the pipeline to follow the same route as the oil pipeline, but we want it to go through most of our country’s productive cities. But discussions are ongoing.”

In order to attract more foreign direct investment from Uganda, President Samia outlined a number of reforms, including online company registration to minimize red tape, lowering the cost of work permits and the Dealing with delays in applications and introducing electronic payment systems.

The Tanzanian leader said that from 1997 to 2022 her country had registered only 29 Ugandan companies, generating about US$29 million in sales annually.

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“We need more and that’s why we came to you today. We have investment opportunities in agriculture, infrastructure, mining, tourism. We believe in a blue economy and can incentivize strategic investors,” she said.

Over the past five years, Tanzania has invested billions of dollars in Dar es Salaam Port infrastructure, railways and infrastructure Water vessels between Dar, Mwanza and Port Bell in Uganda to ensure a smooth and cheaper movement of goods and to lure traders away from the Kenyan port of Mombasa in the long term.

Uganda companies have been pushing both governments to invest in transport infrastructure on this route, to reduce the cost of doing business.

Uganda is rehabilitating its meter gauge railway from Port Bell and Jinja to Kampala and upgrading piers at the two ports to allow smooth trade on the lake. It is also building a river port in Bukasa near Port Bell.