The
World Bank and International Finance Corporation annual report on
“Doing Business and Measuring Business Regulations in East Africa" has
drawn mixed feelings from scholars and from business stakeholders across
the country.
While
others support the report from these two giant financial institutions,
some scholars have told Tanzanians to be more skeptical because the
report will not transform and foster social and economic development in
the region.
Speaking
to the Express in an exclusive interview recently, University of Dar es
Salaam Senior Lecturer Dr Bashiru Ally said that most of those world
financial institutions are imperialists who focus on capital
accumulation and investment in developing countries.
He
said that international financial institutions are paving the way for
multinational companies from developed countries to come and invest in
developing countries in all key sectors of the economy.
“African
leaders and entrepreneurs should rethink how to control their growing
economies in this era of technology, globalization and investment, to
ensure African economies are controlled by African themselves.”
“These
IMF, IFC and the World Bank are trying to block free thinking by
Africans about their economies without outside interference in daily
trade activities,” he said.
Dr
Ally noted that international financial institutions’ eyes are on the
rich African resources available in sectors such as mining, fishing,
fertile land, construction, and commerce.
He
said that Africa will be constructed and developed by Africans
themselves through natural resources, but they need proper regulatory
reforms which will foster social and economic progress.
For
his part David Mbulumi from the United Nations Development Program
(UNDP) said the IMF and the World Bank reports for Africa do not reflect
the reality of most of the developing nations in Africa.
He
noted that for instance Millennium Development Goals criteria’s are not
applicable to most African countries and funnily enough you cannot
compare Africa, with the Caribbean, Europe, America or Asia in various
aspects, such as trade, construction and the business environment.
He
said that these reports are not applicable to most of the developing
nations, due to the fact that criteria used by these giant institutions
are not suitable for the African continent.
“I
am a little bit skeptical about these reports because they are using
the same criteria worldwide while Africa and Europe have different
cultures, values, business and environments and it is not logical to
dump them in the same basket,” he said.
Mbulumi
added that whereas these reports outlined the weaknesses in registering
and starting up business, bureaucracy in getting construction permits
and the cost of doing business in African countries, sometimes these
studies are biased.
He
further said these criteria are too general across the world, which
fails to do justice to the African continent, and it is not fair to
match developed and developing countries in regulatory reforms, law and
order, technology, infrastructure and capital for investment.
“I
am strongly advocating these reports on doing business in Africa and
East Africa because they are featuring what is really happening on the
ground in most of the developing countries,” says Hussein Kamote
Director of Policy and Advocacy from Confederation of Tanzania
industries.
He
said that corruption, bureaucracy and red tape are the major setback of
investment, especially foreign direct investment in Tanzania.
“Some
of the business people nowadays turn to neighboring countries such as
Rwanda, Namibia, Mozambique and Zambia, where bureaucracy is very low
and opportunities available,” says Kamote.
Kamote
cited an example of the business people who were investing in the
textile industry but have decided to shift from Tanzania to Mozambique
due to the red tape which is continuing rampant in that key sector.
He
said that in Tanzania the process of registering companies or getting
business licenses is too cumbersome compared to other East African
countries such as Rwanda, which for the last two years has attracted
foreign investors into tourism, construction and other key sectors.
Kamote
said that these IMF and the World Bank reports on doing business in
Africa is a great opportunity for the African people to start
restructuring and revamp their overall system.
For
his part the corporate lawyer Christopher Singa told the “Guardian”
that the IMF and the World Bank are development partners in every key
sector such as construction, mining, telecommunication and public
services.
He
said that according to IFC and the World Bank report on doing business,
for 2012/2013 it applauded the East African governments including
Tanzania for implementing proper regulatory reforms that improve the
environment for local businesses.
Singa
added that continuous improvement of the business environment is
important for economies seeking to benefit from increased trade and
investment through regional integration.
The
latest report of those two giant world financial institutions shows
that the business environment for entrepreneurs in all five economies of
the East African Community: Burundi, Kenya, Rwanda, Tanzania and
Uganda have improved.
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