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by Ben Taylor
Six months into the presidency of President Samia Suluhu Hassan, it remains unclear what her leadership will bring. In some areas she has shown a clear change of direction compared to her predecessor, while in others the difference brought about by the change of leader has been barely discernible.
There are three areas where the change is considerable. The first of these is her handling of the Coronavirus pandemic, where she has abandoned some of the more idiosyncratic approaches employed by President Magufuli [see separate article].
Second is her diplomatic outlook. Her predecessor rarely travelled outside the country and delivered a pugnacious style of foreign policy, based on the starting assumption that everyone else’s intentions towards Tanzania are malign. In contrast, President Hassan has employed a more open style and a gentler touch. And she has travelled more: already visiting Uganda (twice), Kenya, Burundi, Rwanda, Malawi, Mozambique and Zambia, meaning she has made as many foreign trips in her first six months as President Magufuli took in his entire time in office.
She has taken steps to patch up relations with Kenya, particularly over trade in agricultural produce. A Presidential visit to Kenya delivered a bilateral deal to abolish the restrictions that Nairobi had imposed on Tanzanian maize, which in turn led to a reported six-fold increase in maize exports to Kenya.
Under her leadership, the Tanzanian government has also ratified the African Continental Free Trade Area (AfCFTA) agreement. This is expected to attract more investors and provide access to a large market for the country’s produce and workers. If implemented successfully, the newly formed free trade area will unlock a regional market of 1.2 billion people with a combined gross domestic product (GDP) of $3.4 trillion for international investors. The AfCFTA agreement, signed in March 2018, hopes to double intra-African trade. The official start of trading was delayed in 2020 by the Coronavirus pandemic, but it began officially on January 1st 2021. Tanzania now joins 41 other countries as part of the agreement.
The third area of difference is her attitude towards economics, and business in particular. President Magufuli’s “bulldozer” style encompassed his approach to economic matters, including a no-nonsense stance on taxation and an aggressive posture towards the business interests of those he perceived as working against him. Foreign investors complained that the business environment had become more difficult. The economic effects of these positions are hard to assess with confidence, particularly given how politicised official economic data became under his Presidency – to the point where the IMF and World Bank pointedly stopped trusting official figures. Nevertheless, the effects are widely perceived to have included both a tightening of economic conditions and an increase in tax revenues.
President Hassan, in contrast, has made overtures to investors and business leaders. She has said that henceforth, tax collection would focus on compliance instead of coercion and intimidation. She has also promised that her government will actively listen to business leaders, so it can understand and address their complaints.
At the same time, the new President has attracted criticism for the way her government has turned its tax-raising attention to ordinary citizens – through the mobile money tax [see Economics and Business section in this issue], and through other measures that hit the poor hardest, such as refocussing building taxes on renters rather than landlords.
On domestic political matters, the extent to which President Hassan has diverged from President Magufuli’s heavy-handed style remains highly uncertain. Despite initial signs of a relaxation of restrictions on political activity and freedom of expression, more recently there have been growing concerns among pro-democracy groups that the new President’s approach may have more in common with her predecessor’s than previously thought.
Most obviously, the arrest and detention of opposition leader Freeman Mbowe on terrorism charges [see separate article] provoked such concerns. The extent to which the President was involved in the decision to charge Mbowe is unclear, but it is unlikely that it would have gone ahead without her approval. She has also spoken about the case, telling the BBC that the charges were not politically motivated and arguing that the country remains very democratic. She added that while the case is in court she is not at liberty to discuss it in detail, and advised that the judiciary should be left to do their job.
Similar concerns have been prompted by the suspension of two newspapers. In early September, Raia Mwema, a leading Swahili-language weekly, was suspended for 30 days, for “repeatedly publishing false information and deliberate incitement,” according to Gerson Msigwa, the government’s chief spokesperson. He cited three recent stories, including one about a gunman who killed four people in a rampage through a diplomatic quarter of Dar es Salaam. The article linked the gunman to ruling party Chama cha Mapinduzi (CCM), according to Msigwa, adding that the article violated the 2016 Media Services Act.
The other suspension, introduced several weeks earlier, arguably hints at perhaps the greatest challenge President Hassan faces. In this case, the CCM-owned Uhuru newspaper was suspended for 14 days, after publishing a front page story under the headline: “I Don’t Have Intentions to Contest for Presidency in 2025 – Samia.”
A power struggle underway?
To suspend her own party’s newspaper, particularly given the subject of the offending article, suggests an internal struggle for control within CCM. President Magufuli had built up a party machinery filled with his supporters. Many of these are uncomfortable with some of the changes President Hassan has brought in. Others are more pragmatic, adjusting their stances to align with the new circumstances. Yet more are looking anxiously (or ambitiously) towards 2025, when the next Presidential elections are due.
The constitution is clear: President Hassan is entitled to run again for President in 2025. President Magufuli would not have been eligible to do so. (Unless he had brought in constitutional change to term limits, which had looked possible but which is now a moot point.) Thus any party figure with presidential aspirations faces the probable reality that those ambitions will have to be delayed by five more years. There are no doubt some prominent and influential figures and their supporters who are frustrated by this, some of whom may have wished to foster an expectation President Hassan should merely serve out President Magufuli’s second term and then step down in 2025.
Internal power struggles within CCM are nothing new. President Magufuli himself became leader of the party without a strong base of support – essentially a compromise candidate – and it took some time (and a strong will) before he was able to stifle the grumblings of internal dissent and shape the party in his own image. The popularity he gained with the public for his no-nonsense approach and vocal patriotism made it hard for opponents within the party to stand up to him, and he came down hard on anyone who expressed critical views.
Nevertheless, President Hassan faces an even more difficult challenge. Having become President on the basis of being Vice President at the time of her predecessor’s untimely death, and having essentially been hand-picked for Vice President by a tiny group of party insiders rather than by the membership at large, she starts with an even weaker power base than President Magufuli had. She is yet to prove herself with the public. And she has to contend with two large sets of party members who are pre-disposed to remain lukewarm towards her: die-hard Magufuli supporters and those with presidential ambitions of their own.
These challenges may also be showing up in President Hassan’s handling of other matters – such as Covid-19, or even the arrest of Mbowe. Would she be inclined to do things differently if she didn’t have internal party management matters to consider? Is she picking her battles carefully, choosing where to apply her limited political capital and where to let things go?
Even beyond politics, Covid, diplomacy and economics, there are other matters of significance where the President is yet to make her direction clear. Will she maintain President Magufuli’s hard-line approach to corruption and waste in government, or might we see the return of these problems that plagued the country in earlier periods? How will she handle the legacy of the mega-projects – the Stiegler’s Gorge dam, the purchase of aircraft for Air Tanzania – that may prove more complicated to manage than to introduce?
No-one is yet in a position to conclude with confidence what President Hassan’s style or focus will be. To date, this could perhaps be summarised as a gentler and more open version of Magufuli-ism. But isn’t a compassionate bulldozer a contradiction in terms?
by Ben TaylorOn July 21st, Freeman Mbowe, the leader of Tanzania’s largest opposition party Chadema, was arrested. The arrest took place at 2.30am at his hotel in Mwanza, hours before Mbowe was due to speak at a conference calling for constitutional reforms. Ten other party members, including some holding leadership positions, were also arrested.
Mbowe was charged five days later. He appeared before Kisutu Magistrate’s Court where he was charged with conspiracy and the provision of funds to commit terrorist acts under Tanzania’s Economic and Organized Crime Control Act and its Prevention of Terrorism Act, respectively. As these are terrorism-related charges, Mbowe does not have the right to apply for bail under Tanzania’s Criminal Procedure Act.
Prosecutors explained that the charges do not relate to the constitutional reform forum Chadema had planned to hold in Mwanza, but to alleged offences dating from 2020 in another part of the country.
“Moments like this take Tanzania a step backwards,” said James Mbatia, leader of the NCCR-Mageuzi opposition party. “The president’s wisdom is needed so that we move forward,” he added.
The international community were also alarmed at developments. “We have expressed our concern about the treatment and imprisonment of the opposition leader Mbowe,” said Victoria Nuland, US Under-Secretary for Political Affairs. Nuland was speaking at the end of a visit to Tanzania during which she met President Samia Suluhu Hassan and the Minister of Foreign Affairs, Liberata Mulamula, as well as opposition leaders, part of a tour of several African countries.
Human rights group Amnesty International called on the Tanzania government to “substantiate the charges” against Mbowe or to release him. “His arrest and continued detention appears to be a tactic to silence critical voices as part of a growing crackdown against the political opposition,” they added.
On the occasion of his first court appearance, in early August, riot police broke up a demonstration by Mbowe supporters. They held banners “Mbowe is not a terrorist” and “Free Freeman Mbowe”.
“Freeman Mbowe, parliamentarian for 15 years, leader of the official opposition in parliament for 10 years and head of the largest legal opposition party for 17 years is not a terrorist,” said Tundu Lissu, Chadema’s deputy chairman.
Amid tight security, the trial at the high court in Dar-es-Salaam opened on August 31st. Most journalists were banned from the courtroom by police.
The government had warned foreign diplomats against turning up to the court to follow the case without notifying the foreign ministry, citing Covid-19 regulations and security concerns. Nevertheless, representatives from the British High Commission and US Embassy were present at the hearing, which was also attended by Chadema’s senior leaders.
Chadema have described the case as a throwback to the repressive era of President Magufuli, and said it represented the loss of hope that the new President would sweep away many of her predecessor’s restrictions on democratic political activity.
In a pre-trial hearing, Mbowe’s lawyers had argued that his initial arrest and detention had been unlawful, as he and his co-accused had been held for five days without being charged or being able to see his lawyers. “They told the court that they were tortured and humiliated and forced to record such statements,” said Mbowe’s lawyer, Peter Kibatala, after the hearing. He added that “These were not voluntary statements.” The court dismissed these objections and allowed that the trial should proceed.
Chadema has said prosecutors accuse Mbowe of conspiring to attack a public official, and of giving 600,000 Tanzanian shillings ($260/220 euros) towards blowing up petrol stations and public gatherings and cutting down trees to block roads.
STOP PRESS: As the trial began in early September, Regional Police Commander for Kinondoni (Dar es Salaam), Ramadhani Kingai, told the court that Freeman Mbowe had sought to recruit retired or expelled army commandos to carry out acts of terrorism in various part of Tanzania. He claimed that Mbowe and a group of others were planning to blow up fuel stations and markets and block vehicles on highways so that they could conduct robberies. He also claimed that the alleged criminal group planned to carry out these acts in the run up to the 2020 general election, with the intention of showing that Tanzania was ungovernable.
At the time of writing, the case has been adjourned to allow for a hearing on whether statements taken from the accused outside the 8-hour time limit for cautioned statements should be admissible.
by Ben Taylor
Among the many changes to Tanzania’s political landscape brought about by the change in top-level leadership, second only to Covid in prominence is perhaps the revival of debates about the country’s constitution. President Magufuli had made it clear that he had no intention of revisiting the topic, but perhaps President Samia Suluhu Hassan would see things differently. As a Zanzibari, she would certainly be expected to have a different perspective on the matter.
This was certainly the hope of both the two main opposition parties, ACT Wazalendo (with its weighty former-CUF contingent – see previous issues) and Chadema. Almost as soon as President Hassan was sworn into office, they began calling for a new constitution review process. The Chadema leader, Freeman Mbowe, publicly stated in May that his party would boycott the next general elections in 2025 unless a new constitution is in place.
“I have told Madam Samia that the constitution is not a personal issue but for the country and we will demand and fight for it with blood and sweat so that we get it before the General Election in 2025,” he said. It remains unclear what response she gave, but it certainly seemed to encourage the opposition parties that the change of President had opened a door to the possibility.
The most recent efforts to rewrite the country’s mother law had stalled in 2015, when time ran out on preparations for a referendum on a constitution drafted over the previous few years. President Kikwete’s second term of office came to an end in November of 2015, and President Magufuli saw no reason to move forward with what had become a very controversial matter, so the “proposed constitution” has never been put to a public vote. Nor was the “Warioba draft”, prepared by the Constitutional Review Commission under the leadership of former Prime Minister Joseph Warioba.
The two competing versions represent the controversy in the case. The Warioba draft proposed a substantive change to the relationship between Zanzibar and the rest of the country, with a “three government structure” comprising governments of Zanzibar, mainland Tanzania, and the United Republic. This was popular with the public on Zanzibar, including many CCM members and supporters, and with all the main opposition parties. Under President Kikwete’s guidance, however, this version was substantially edited late in the process by members of the CCM-dominated Constituent Assembly. The redrafting replaced the three government structure with something much more similar to the current two-government arrangements, motivated by concerns that the three-government approach was a ruse to split the union. It was this edited version that was set to be put to a public referendum in 2015, with results that looked set to be too close to predict.
The relationship between Zanzibar and mainland Tanzania is not the only issue prompting opposition parties to call for change. Chadema and ACT Wazalendo would each like to see changes that trim the powers of the Presidency, provide a strong and independent foundation for key bodies such as the National Electoral Commission and the judiciary, and strengthen protections for freedom of expression, freedom of assembly and freedom of association.
Nevertheless, the two competing visions for the country’s future governance, as represented by the two draft constitutions, present a serious sticking point for restarting discussions: which version should be brought back to the table? Positions on the two drafts have been deeply entrenched, and finding a way forward that allows all parties to sit together and consolidate them will not be easy.
“The President should own the process and pick a team of experts who will harmonize issues from the Second Draft Constitution and those in the Proposed Constitution,” according to Deus Kibamba of the Tanzania Constitution Forum, a civil society group.
Nor will it be easy to reach agreement that such a process should even be attempted. CCM secretary of Ideology and Publicity Shaka Hamdu Shaka, said in June that constitutional matters were not the party’s priority, that instead the ruling party was focused on national development.
President Samia Suluhu Hassan made her views on the matter known on June 28, arguing that the issue should wait so that she could have more time to guide the country to a full economic recovery from the Coronavirus pandemic. She used the term “chokochoko” (provocations) to describe the calls.
Warioba had thoughts on this: “The President has asked to be given more time, it is true, I agree, but until when? I think it is upon leaders themselves to agree on when the process of a new constitution should continue.” He suggested a referendum could be held concurrently with local government elections scheduled for late 2024.
“My advice is that these leaders should meet not to confront one another, but to have discussions on the problems facing the country: on how we deal with the Coronavirus, on a new constitution, on how we can boost our economy,” he suggested.
by Ben Taylor
The UK Minister for Africa, James Duddridge, met and held talks with President Samia Suluhu Hassan and Foreign Minister Liberata Mulamula on a visit to Tanzania at the start of June. The Minister also travelled to Zanzibar to meet with President Hussein Mwinyi and First Vice-President Othman Masoud Sharif, to discuss the Government of National Unity and the progress being made on political reconciliation.
In a meeting with the Minister for Industry and Trade, Kitila Mkumbo, and Minister for Investment, Geoffrey Mwambe, Mr Duddridge discussed the potential for increased UK investment in Tanzania and sought reassurances that improvements to Tanzania’s business environment would be implemented.
Mr Duddridge also visited sites where UK aid has delivered improvements to schools and hospitals.
Speaking at the end of the visit, Duddridge said he was “pleased that my first visit to Tanzania since the inauguration of President Samia Suluhu Hassan has been productive and mutually beneficial. I welcomed the President’s commitments on international cooperation, working with the business sector and seeking advice from Tanzanian experts on COVID-19 and I encouraged decisive action to tackle the effects of the pandemic in Tanzania. I look forward to engaging further as these areas progress.”
British High Commissioner to Tanzania, David Concar said “the visit of a UK Minister to Zanzibar after many years to assess progress in the unity government is an important reminder of the rich historic relationship between the UK and the islands, and demonstrates the UK’s desire to see sustained progress towards an inclusive, representative Zanzibar governed for all.”
by Ben Taylor
Turning a tanker around?
President Samia Suluhu Hassan has continued her efforts to reshape Tanzania’s national response to the Coronavirus, including a number of changes President Magufuli had warned against.
In mid-May, three months after taking office, the scientific advisory committee she formed reported back. The body recommended that the virus’s presence in Tanzania should be publicly acknowledged, that Covid data should be made public, and that Tanzania should join the international effort to supply Covid-19 vaccines to developing countries, Covax.
Most prominently, in June, the President acted on the third of these recommendations and reversed her predecessor’s stance on vaccines. She first allowed international organisations and diplomatic missions to import vaccines for their employees, and shortly after this the country applied to join Covax.
On July 24, the country received a batch of one million Johnson and Johnson single-dose vaccines, donated by the US government. Zanzibar has received doses of the Sinovac vaccine from China. Both vaccines have been approved for use by the World Health Organisation (WHO). Tanzania is also believed to be participating in the African Union’s joint vaccine purchasing programme.
A few days after the US-donated vaccines arrived, the President herself was publicly given one of the first doses. She used the occasion to encourage the public to get vaccinated, pointing out that the country was “not an island” in dealing with the pandemic.
President Hassan wore a mask when receiving her vaccine, as she has done on most public appearances in the past few months. She did not do so right at the start of her Presidency, following the lead of President Magufuli who had shunned both masks and vaccines. And while, under her predecessor, mask wearing was uncommon, it has become much more normal to see leaders and public officials wearing them of late.
The President has also begun allowing some data on case numbers, hospitalisations and fatalities to be released. Specifically, in late June, the Ministry of Health published the first such data in over a year, stating that the “third wave” had thus far led to 100 cases in the country, of which 70 had required oxygen. Four weeks later, the Ministry released more figures, confirming 29 deaths with 176 new coronavirus cases recorded the previous day, and mentioning that the new cases brought the total number of cases in the third wave to 858.
The release of data has been piecemeal, however, with inconsistent figures and formats used. The low official numbers also stand in stark contrast to the hundreds or thousands of new daily cases being identified in neighbouring Kenya and Uganda. Few analysts take the figures seriously, arguing either that the government is still not being honest with the public, or that 12 months of denying the situation has eroded the capacity of public health institutions to deliver a reliable testing regime and to collate accurate statistics.
These data releases provided part fulfilment of a commitment to do so, made to the International Monetary Fund (IMF) in order to access emergency financial support to enable Tanzania to cope with the pandemic. At the start of September, the IMF board approved USD $567m in emergency support to Tanzania to help finance a vaccination campaign and meet the health and social costs of the pandemic.
More broadly, and of particular significance when it comes to the vaccination campaign, the situation is complicated by the continued denialism of some of President Magufuli’s supporters. Most notably, the prominent evangelical preacher and Member of Parliament, Bishop Josephat Gwajima, has claimed without evidence that vaccines can interfere with human DNA.
“Are we that brainless? Doctors, professors: have you decided to put your brains in your pockets?” he asked his congregation. “People taking the vaccines risk becoming mentally challenged or monitored by computers from the West,” he added.
In a sign both that the previous President’s views no longer hold sway and that his methods may be harder to shake off, the government in response ordered the police and anti-corruption authorities to arrest and interrogate Bishop Gwajima to substantiate his statements against Covid-19 vaccines.
Doctors, however, have cautiously welcomed President Hassan’s changes. It has allowed them to work more freely, diagnose patients and treat them without fear of repercussions from the authorities, said Shadrack Mwaibambe, Head of the Tanzanian Medical Association. He did note, however, that the government continued to support – though no longer to encourage – the use of “remedies” with no scientific support, including steam inhalation. He argued that the authorities should not be talking of such things now they have decided to follow the science.
While critics of President Magufuli’s approach to the pandemic remain frustrated that the new President has not gone as far as they would like, other commentators are more understanding of her position.
“Misinformation [about COVID-19 vaccines] is widespread,” said one doctor, who asked to remain anonymous, “and unfortunately it came from official sources.”
“Things changed so suddenly. I know many people who are still trying to reconcile themselves to the government’s new COVID approach,” says Herrieth Makwetta, a health reporter for Mwananchi newspaper.
Another medic, Dr. Shindo Kilawa, of Muhimbili National Hospital, says the government faces a tough task ahead in promoting the vaccines. “To break away from the past, psychologically, I see the need for a massive awareness campaign, mainly targeting the general public. Otherwise we could end up with many unused stocks of vaccines,” he said.
Government figures are personally trying to navigate a tricky change of direction. In February, Health Minister Dr Dorothy Gwajima had been publicly and vocally sceptical of masks and vaccines, preferring instead to promote various herbal concoctions. She now wears a mask in public, and is urging the public to come forward for vaccinations. Similarly, Hamisi Kigwangala, a medical doctor and prominent MP, publicly spoke against Covid-19 vaccines in February but has lately made a U-turn. He was filmed in July receiving a Covid-19 vaccine and has started a social media awareness campaign to encourage greater take-up. “The vaccine is the only sure way we have for now to remain safe, so if one gets a chance, they should take it without wasting time,’’ he told a reporter for the US broadcaster, NPR.
While such course corrections may be awkward and embarrassing for individual politicians, they are emblematic of the challenge the President faces. A widely-beloved President told the country one thing, in emphatic terms. The new President now has the task of telling them this was wrong, ideally without appearing to criticise the source of the falsehoods. This is made even harder by the fact that confidence in science has always been low in Tanzania.
Convincing a sceptical nation to wear masks, maintain good hygiene and distancing practices, and to seek medical help when needed will be difficult. Convincing people to get vaccinated will be even more so.
by Paul Harrison
Rising hope for the tourism sector as Tanzania receives COVID-19 vaccines
In July 2021, mainland Tanzania received its first consignment of over one million doses of Johnson & Johnson COVID-19 vaccines from the United States as part of the COVAX arrangement. Unlike her predecessor, Tanzania’s President, Samia Suluhu Hassan, has received a COVID19 vaccine in public, kicking off a nationwide inoculation campaign in the fight against the disease, with Zanzibari citizens receiving the Russian Sputnik vaccination amongst others. A significant step toward protecting Tanzanian citizens, the vaccination programme also represents a major confidence builder to tourists who are currently visiting the country and indeed those who are planning to visit in the future. The greater the rollout, the more likely that Tanzania will be removed from amber and red lists of EU countries, the UK and the USA.
Tanzania’s tourism sector is gradually recovering from the effects of the pandemic. Signs of growth are emerging in many parts of the country as hotel visits, game viewing and other tourist activities are starting to pick up. Traditionally, Tanzania has received the bulk of tourist arrivals from the USA, UK, France, Italy, Germany, Spain, Canada, Australia, Ireland and the Netherlands, but recently Russia is emerging as a new market, amongst others. Notably, Tanzania was expected to receive over 650 tourists from Israel during August 2021, according to the Citizen.
Selous ecosystem seems set to maintain UNESCO World Heritage status
Over the last five years, the Selous Game Reserve (now split between Nyerere national park and the reserve) was under increasing threat of being delisted as a UNESCO world heritage site. The threat of removal came from the decision made under the previous administration to construct a hydropower dam on the Rufiji river, which also led to substantial logging to clear the site.
However, due to an on-going dialogue with UNESCO and conservation efforts within the Selous ecosystem, Tanzania has been allowed, in principle, to maintain the status of the Selous as a UNESCO world heritage site, subject to proof of conservation efforts.
According to The Citizen, during the extended 44th session of the World Heritage Committee meeting, held online from Fuzhou, China from 16-31 July 2021, Tanzania has been directed to address the concerns raised and report by December 1st 2021. This is a promising indication that the Selous ecosystem may maintain its current label as a prestigious World Heritage site and continue to benefit from tourism opportunities there. This assumes Tanzania can continue to protect cultural and environmental treasures of the Selous as well as mitigating issues of degradation around the dam and to tackle human wildlife conflict in the wider landscape.
In Zanzibar, new investment is sought into high-end tourism
According to The East African, in late August the Zanzibar government, through the Zanzibar Investment Promotion Authority (ZIPA), issued an invitation to investors to bid for high-end tourism investments in key small islands. This is intended to boost revenues, part of the wider blue economy drive. Would be-investors were given until 16th September 2021 to submit proposals. Several small islands were offered for premium environmentally and culturally sensitive development projects, including Changuu, Bawe, Pamunda and Kwale islands off Unguja and Njao, Misali and Matumbini islands off Pemba.
In the same period, the BBC reported plans by the government of Zanzibar to build sub-Saharan Africa’s highest skyscraper, with a linked marina development, at a cost of likely upwards of £950 million, assuming investment can be found.
Generally, mainstream tourism numbers have been rising steadily in Zanzibar over the northern hemisphere summer months, though yet to reach pre-pandemic levels. A flood of Russian tourists earlier in the year now appears to have subsided though the trends suggest a shift towards countries like Russia away from traditional beach tourism markets, though that trend may settle back in time. Italian tourists, typically the mainstay of the Zanzibari beach tourism industry, have yet to return in any significant numbers.
by Ben Taylor
Controversial mobile money tax introduced, partially retracted
The most controversial and headline-grabbing move in the 2021-22 budget was a new tax on sending and withdrawing money on mobile phones. A levy of between TSh 10 and TSh 10,000 was introduced on mobile money transactions.
The effect varies according to the particular network being used and the amounts of money involved, but for example, the cost of a transfer of TSh 15,000 on Airtel Money would rise from TSh 350 to TSh 960, while the cost of a TSh 600,000 transfer on the same network would rise from TSh 1,000 to TSh 7,400.
The government hoped the move would raise a total of TSh 1,254 bn over the course of the year. Framing it as a “Patriotism Levy”, Finance and Planning minister Mwigulu Nchemba said it was important that every Tanzanian took part in it.
Given that 2019 saw mobile money transfers in Tanzania worth approximately $40 billion, representing over 60% of the country’s GDP, this new tax could potentially have a major impact on the circulation of money, on poverty reduction efforts, and on the economy as a whole.
The change prompted a major outcry from economists and citizen groups across the country. Richard E. Ms homba, Professor of Economics at La Salle University, Philadelphia, USA, wrote that “the end does not justify the means”. He added that though this type of levy “may be a convenient tax window, it may also lead to a slowdown in economic activities and exacerbate inequality in the country.”
In previous research, the global association of mobile phone network operators, GSMA, found that taxes of this kind are generally “regressive in nature, undermining the fundamental concept of tax equity.”
The Legal and Human Rights Centre (LHRC) filed a court case challenging the new levies.
A few days after the levy came into effect on July 15, the Tanzania Mobile Network Operators Association (TAMNOA) said the business has dropped drastically, therefore asking government to amend the new charges.
The government responded to these complaints by first announcing in late July that possible changes to the levy were under discussion, and President Samia Suluhu Hassan directed the Minister of Finance and Planning, Dr Mwigulu Nchemba and his Communications and Information Technology counterpart Dr Faustine Ndugulile to review mobile money transaction charges.
Then, at the end of August, the Ministry of Finance and Planning released a statement saying Dr Nchemba had signed the amendments of the Regulations for Electronic Transactions Levy for 2021 with a view to reduce the rates by 30%.
Business leaders welcome 2021-22 budget
Finance and Economic Planning minister Mwigulu Nchemba in June tabled the TSh 36.3 trillion budget before Parliament, with a bundle of fiscal measures that business associations say contain promising prospects. A slightly-revised budget was approved by parliament two weeks later, with a value of TSh 36.6 trillion.
Headline measures in the budget include a cut in PAYE from 9% to 8% for the lowest taxable band, cuts on various import tariffs and abolition of VAT on imported metals and raw materials.
Confederation of Tanzania Industries (CTI) policy specialist Frank Dafa said the budget generally brought relief to the manufacturing sector and the move could boost investment and increase job opportunities.
“There are significant improvements in the taxes and levies of employers and manufacturers. So the relief provided will stimulate industrial growth,” said Mr Dafa, adding that the abolition of the 15% additional import duty on industrial sugar was commendable. The local manufacturers have been complaining about the requirement which left their billions of shillings in the hands of the government due to delayed refunds.
Tanzania Bankers Association (TBA) chairman Abdulmajid Nsekela echoed the sentiments, saying that it was a relief budget. He said if the budget would be implemented accordingly it would create conducive environment for business, translating into more opportunities for banks to provide finance.
Nevertheless, CEO Roundtable chairman Sanjay Rughani said “a deeper look on the impact from the newly introduced taxes on mobile money transactions plus daily levy on SIM card is necessary as it can constrain the financial inclusion agenda and can have other implications.”
by Ben Taylor
Electric trains for standard-gauge railway to be supply by Hyundai
Hyundai Rotem of South Korea has won a TSh 335.4 bn (USD $296m) contract to supply 80 electric multiple units (EMUs) and 17 electric locomotives to the Tanzania Railway Corporation (TRC). The vehicles will be supplied by 2024.
The electric vehicles will be used on the 546km railway running from Dar es Salaam to Makutupora, recently reconstructed during the first two phases of the Tanzania standard gauge railway project.
The deal follows the Tanzanian government’s plan to modernise its rail network, investing $6.9 billion to do so. Tanzania’s rails were narrower than standard gauge, and trains had to be driven at a slow speed of 30 to 40 km per hour.
With the new rails, electric locomotives and EMUs supplied by Hyundai Rotem will run at a maximum speed of 160 km per hour.
The Minister for Works and Transport, Dr Leonard Chamuriho, added that TRC will receive 42 locomotives by November 2021, part of a previous contract related to the Dar-Morogoro section of the new line.
“Earlier, we procured 42 electric locomotives from Germany and South Korea. Once they arrive in November, the testing of the SGR section from Dar es Salaam to Morogoro will commence,” he said.
Speaking at the event, TRC Director General, Masanja Kadogosa, said the contracts would also involve training local engineers on how to operate the SGR.
“In every contract that we have signed so far, there is a component that compels the teaching of local experts on maintenance, signals and driving. We want more local engineers to be competent in all the aspects just like the way we have our own experts operating Air Tanzania,” he said. Two hundred engineers and ten drivers will go Korea to learn how to operate electric trains, he explained.
New European flights to Tanzania
Two European airlines, Air France and Edelweiss have announced plans to launch new flights to Tanzania. This brings the number of European airlines flying direct passenger flights to Tanzania to three, joining KLM. A fourth airline, Swiss Air, only operates cargo flights to Tanzania.
The Air France flight, set for launch in October 2021, will connect direct from Paris to Zanzibar, with a possible loop to Nairobi. This will take place twice a week.
Edelweiss also plans to launch in October, with twice-weekly flights from Zurich to Kilimanjaro International Airport. One of these weekly flights will also connect to Dar es Salaam, and the other to Zanzibar.
Tanzania Association of Tour Operators (TATO) chairman, Mr Wilbard Chambulo, said the tourism industry welcomes Edelweiss Air with open hands.
The global Covid-19 pandemic precipitated a dramatic decline in air travel worldwide, including Tanzania. The latest Tanzania Civil Aviation Authority (TCAA) report shows that passenger traffic to/ from the country suffered a 50% drop in 2020 compared to 2019. An estimated 2.8 million passengers took flights in 2020, the lowest number since 2011. Cargo flights were not affected so significantly. According to the regulator, last year’s cargo volume decreased by 18% to 21,907 tonnes. The International Air Transport Association (IATA) estimates that the industry will fully recover by 2024.
World Bank support for rural roads
In the Roads to Inclusion and Socioeconomic Opportunities (RISE) project, will spend $300m to give Tanzanians in rural areas better access to roads in good condition to enable them to access services and economic opportunities.
RISE will upgrade roads with climate resilient approaches in six rural districts across four regions – Geita, Tanga, Lindi and Iringa – promoting a sustainable model for routine maintenance, removing bottlenecks that inhibit the improvement of rural roads, and incorporating people-centered community engagement approaches.
RISE is projected to generate around 35,000 civil works jobs, including 19,000 community-based routine maintenance contracts involving rural communities, with at least 20 percent of these jobs held by women.
“Approval of the project reflects the World Bank’s strong support to Tanzania,” said Hafez Ghanem, Regional Vice President for the World Bank. “We want to continue and even strengthen our partnership with Tanzania in its efforts to fight poverty and ensure a better living standard for its people. [These] investments will help accelerate growth as they expand access to economic opportunities, especially for women and youth.”
by Ben Taylor
World Bank support for Higher Education
In May, the World Bank approved a combined financing of $875 million (about TSh 2 trillion) for three development projects, including $425 million on the Higher Education for Economic Transformation (HEET) project.
The finance from the International Development Association (IDA) also aims to help improve rural road access and employment opportunities and increased access to high quality broadband internet services.
“Approval of the three projects reflects the World Bank’s strong support to Tanzania,” said Mr Hafez Ghanem, the Regional Vice President for the World Bank.
“The experiences of successfully transitioning economies have shown that strong human capital is fundamental for long-term growth and the development of an economically secure middle class,” said Mara Warwick, World Bank country director. “These projects prioritize such investments, which will enable households at all income levels in Tanzania to benefit from growth.”
The HEET project aims to strengthen the learning environment, ensure greater alignment of priority degree programs to labour market needs, and improve the management of the higher education system.
This will be achieved by strengthening and building the capacity of 14 public higher education institutions in both Mainland and Zanzibar to become high quality centres of learning, focusing on areas with the greatest potential for growth over the coming decade; and enhancing the management of the higher education system through the Ministry of Education, Science and Technology, and subsidiary agencies. Among the key results, participating universities will add or modernize over 260 academic programs within priority areas, with over 100,000 students benefiting from direct interventions to enhance learning.
Higher education loan charges cut
Students celebrated in May when the Minister of Education, Science and Technology, Joyce Ndalichako confirmed in parliament that the government was implementing President Samia’s Suluhu Hassan’s directive to remove so-called nuisance charges on higher education loans.
Starting July 1, 2021, she said, the 6% charge in value retention to higher education loans beneficiaries will be scrapped, and the government is instructing the Higher Education Students Loans Board (HESLB) board of directors to scrap the 10% penalty charged on loan beneficiaries for delayed loan servicing.
The government, Prof Ndalichako said, was allocating TSh 500 billion during the coming financial year to finance university education of a total of 148,581 students. Of the beneficiaries, 50,250 will be first-years and 98,331 will be continuing students.
Students who spoke to The Citizen expressed support for the move. “I’m happy that the government seems to be creating an environment that will encourage one to repay the HESLB loan,” said Mr Samwel Ngulinzira, who is a beneficiary of the loans.
Luka Mkonongwa, a lecturer in the University of Dar es Salaam (UDSM) College of Education, commented that the government was now valuing children from poor families. “In the past, students ran away from loans and found it better to fund studies on their own because it charged interests like those charged by commercial banks,” he said.
In the same speech to parliament, Prof Ndalichako announced that the government will review the 2014 Education and Training Policy as well as the country’s Education Act of 1978 in order to ensure they meet the current demands.
“The government will also put emphasis in teaching technical education by strengthening practical skills in secondary and technical schools,” she said, adding that the government will also strengthen teaching of skills developing subjects in primary and secondary schools including agriculture, technical subjects, sports, art works and business.
She also stated that the government will conduct a comprehensive evaluation of curricula in order to ensure teaching and learning is delivered according to the qualities and conditions required, including the presence of teachers, textbooks and improved learning environment.
“The government will start reviewing curricula at all levels of education in order to ensure education and training are given the focus of building skills in relation to the present circumstances,” she said.
A-level results – no change in sky-high pass rate
The A-level pass rate has remained stable in 2020 and 2021, with government schools dominating in the top 10 list of best performing schools. The results of the exams, conducted in May this year and released by the National Examinations Council (Necta) in July in Zanzibar, show that the overall pass rate for school candidates was 99.62%, a slight increase from 99.51% in 2020.
The number of candidates who scored Divisions I, II, and III has increased by 0.19 percent from 97.74% in 2020 to 97.93% in 2021.
Only two of the top ten schools in 2021 were private schools (Kemebos and Feza Boys’). The other schools in the top 10 were Kisimiri (Arusha), Dareda (Manyara), Tabora Girls’ (Tabora), Tabora Boys’ (Tabora), Mwandeti (Arusha), Zakia Meghji (Geita), Kilosa (Morogoro) and Mzumbe (Morogoro).
Of the 89,802 candidates registered to take the exam, 88,273 candidates (98.30%) took the exam and 1,529 candidates (1.70%) did not, for various reasons including illness and absenteeism, said Necta’s executive Secretary, Charles Msonde.