IPP MEDIA BLAMES FORIEGN INVESTORS FOR DROP IN FOREIGN DIRECT INVESTMENT IN TANZANIA

Harmony between locals, foreign investors crucial
By Editor

30th December 2009EmailPrintComments


While Tanzania is among African countries that have attracted a big number of foreign investors since the promulgation of the Tanzania Investment Act of 1997, there has been a growing rift between them and some of the local communities.
In some instances, it has been a case of foreign investors pushing out the local communities without commensurate compensation while in others it was the investors making hefty profits and doing little to uplift the people living in surrounding areas from their miserable livelihood.
Yet in some cases it has been cases of investors underpaying and mistreating locals employed in the established firms to the point of stirring resentment against foreign investors.
This may perhaps explain recent economic reports showing Tanzania lagging behind neighbouring Kenya, Democratic Republic of Congo, Zambia and also Madagascar in its ability to attract foreign investors.
While the official explanation for the drop in performance in this crucial economic area is the failure to execute pro-business reforms, the negative perception of the investors by the majority of Tanzanians may be a major stumbling block.
A case in point is the Loliondo fiasco, now a subject of investigation by a Parliamentary probe committee where locals are in a tussle with a foreign investor over land they claim was taken away from them without compensation.
A recent case, now on the desk of the Minister for Labour, Employment and Youth Development, Prof Juma Kapuya, was of a senior local official of a foreign firm, Caroil, who has raised serious allegations of mistreatment by his employer.
In this case, the operations manager of Caroil, William Guzman is alleged to have mistreated his former employer, Frank Mwankefu who he allegedly dismissed without payment of his due terminal benefits forcing him to open a case file with the police.
While this may be a case that is subject for further investigations by concerned authorities, including Prof Kapuya, suffice it to say that there is need to address the rift that is widening between the foreign investors and the local communities.
Our view is that this requires a two pronged approach: Investors must strive to study the locals, understand their needs and aspirations and ensure that the benefits of the investments trickle down to the local people. In short, they must accept locals for them to be accepted.
On the other hand, the government ought to ensure that while welcoming foreign investments, these do not lead to uprooting the people or mistreating them.
The necessary conditions must be laid well in advance to ensure that the two sides work in harmony. If this situation continues, the rift between foreign investors and locals will continue to widen and actually get worse.
But as Prof Kapuya said, while investors are highly encouraged to come and invest in Tanzania, they should respect the country's labour laws.
We need foreign investors in different fields not only for increasing the much needed employment opportunities for Tanzanians but also to contribute to the country’s socio-economic development.
This requires mutual trust and harmony, not antagonism.

SOURCE: THE GUARDIAN