THE African Development Bank (AfDB) has approved 55 million US dollars facility to jumpstart private sector-led economic growth in Tanzania.
The facility, according to press release issued yesterday, will bolster ongoing reforms being undertaken and enhance Tanzania’s economic competitiveness and private sector participation in the country’s growth.
The Bank’s Director of Governance and Public Financial Management Department, Mr Abdoulaye Coulibaly, said the reforms will lead to a more vibrant economy, which will improve the living conditions of Tanzanians, particularly the poor and vulnerable—including women and youth.
“By strengthening the regulatory framework, the country’s private sector will have the required incentives to fully participate in the economy, particularly in cross sector growth-enhancing and transformational investment opportunities,” Mr Coulibaly said.
The country’s private sector is dominated by small enterprises mostly in smallholder agriculture and small informal non-farm businesses.
Constraints to doing business include high compliance costs, lengthy pre-approval procedures, multiple and duplicate processes for business registration, loopholes in some laws and regulations applied by regulators during inspections, and high regulatory costs at the national and local levels.
The ongoing reforms being undertaken by the government have been identified as critical for the participation of local and foreign investors across different sectors of the economy.
Tanzania’s main development challenge has been to make economic growth more inclusive and broad-based – to create employment and equal opportunities across age, geography and gender.
The Bank’s support will finance the second phase of the Good Governance and Private Sector Development Programme (GGPSDP) that will help close the 2019/20 financing gap and make key government agencies more effective.
GGPSDP II will build on strong results from GGPSDP I and support ongoing efforts to reduce the cost of doing business, reduce fees on permits, licenses and registration certificates in key institutions (prior action), phase rollout of the online Business Registration and Licensing Agency registration portal
