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.

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