Tanzania manufacturing doubles value added
By
Mnaku Mbani
Formal
manufacturing in Tanzania has grown significantly in the last decade, which
indicates that there has been an improvement of Manufacturing Value added
((MVA).According
to the working paper on Industry in Tanzania published by United Nations
University (UNU-WIDER) last year, between 2000 and 2010, manufacturing value
added (MVA) more than doubled in real terms from US$894 million to US$1,992
million.
Since
2010 growth of the manufacturing sector has continued to outpace overall GDP
growth, but it has lagged growth in a number of services sectors.
The
working paper shows that beginning from a very small base in 2000, per capita
manufacturing value added grew at 5 per cent per year between 2000 and 2010 to
reach US$44, exceeding the Africa-wide average of US$35 but still below the
average for all low-income countries of US$61.
Agro-processing
is the dominant manufacturing sub-sector. The 287 agro-processing companies in
the ASIP account for 55 per cent of total formal manufacturing output and 65
per cent of total employment.
More
than 80 per cent of agro-processing companies are small and serve the domestic
market.
Manufacture
of furniture (13 per cent), non-metallic mineral products (11 per cent),
tobacco (7 per cent), and textiles (5 per cent) round out the list of other
major manufacturing activities in terms of output.
Textiles
and apparel, and leather as well as leather products experienced sharp declines
in the 1990s and have not recovered.
Although
Tanzania is a major cotton producer, the textiles and apparel sector is small.
Tanzania processes only about 20 per cent of its own cotton after ginning, and
it exports the rest.
The
local processing industry produces few, largely low-quality products and
depends heavily on imports (Dinh and Monga 2013). Tanzania has the third
largest livestock population in Africa, but its production of leather and
leather products is very limited.
About
three-quarters of locally produced raw hides and skins are exported, and 95 per
cent of the remainder is exported after limited processing.
Only
13 small firms are active in the final products segment (8 produce leather
footwear). They employ an estimated 200–300 people and mainly serve the
domestic market.
Maoni
Chapisha Maoni