JK: Gas, oil policy in place in October

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President Jakaya Kikwete opens 19th Annual Research Workshop organised by Research and Poverty Allevation (REPOA) in Dar es Salaam yesterday. (Photo: Tryphone Mweji)

President Jakaya Kikwete yesterday reassured Tanzanians that the government will finalise the policy and legislation for oil and gas extraction in October, this year.

Speaking at the 19th REPOA Annual Research Workshop held in Dar es Salaam yesterday, President Kikwete said there have been extensive discussions on the role natural resources should play in the country’s economy.

“This is particularly relevant today, considering the recent discoveries of large volumes of natural gas, now approximated at 46 trillion cubic feet, and the vast reserves of forests, minerals, diverse wildlife and land that Tanzania has,” he said.

The President also said that the challenge facing the country is how to link these resources with the aspirations of the 2025 Development Vision and the socio-economic transformation the nation desires.

“The strategies and policies are meant to ensure that our people participate productively in the utilisation of the natural resources we are blessed with.

We are also in the process of putting in place a local content policy that will provide a framework for ensuring adequate participation of Micro, Small and Medium Enterprises and local communities in exploiting and utilising our
natural resources,” he said.

He added: “We hope that the private sector, working closely with the government, will proactively engage in the efforts to build the capacity of Tanzanians in different disciplines that are relevant to the various segments of our natural resources’ value chain”.

He underscored that the oil and gas sector is a priority subsector, given the volume of the resources, the intensity of capital investments, and flow of revenues expected from their commercialisation.

“I hope that this workshop will dwell on these issues too, drawing from the experience of other countries as well, on how the enterprise sector including the MSMEs can be leveraged to participate more meaningfully in the desired socio-economic transformation,” the President said.

The president noted that a sound business environment and regulatory landscape have allowed enterprises, both large and MSMEs to thrive and effectively address the problem of unemployment, especially among the youths.
He added that the quest for inclusive development requires dramatic transformation of mind-sets and attitudes as well.

For his part, REPOA Executive Director Prof Samwel Wangwe said that reviews of trends in growth, employment and poverty in Tanzania have highlighted challenges and risks of achieving high growth which is not accompanied with the requisite transformation of the economy and widespread job creation.

“This signifies the challenge of low productivity and low returns to labour in agriculture and micro and small enterprises is predominantly in the informal economy where majority of Tanzanians derive their livelihoods from,” he said.

He added: “The low returns to labour in agriculture push people out of the sector in search of alternative sources of employment, but most of this migrating labour ends up in the lowest end of the non-farm sectors, mainly trade, other services and a few in manufacturing activities.”

He also said that the resulting kind of urbanisation where the informal economic activities provide low returns to labour carries with it the risk of turning rural poverty into urban poverty.

He insisted that there is a quest for deeper understanding of what it would take to transition from rural and urban poverty to prosperity in both the rural and urban economy.

The main objective of the two-day workshop is to achieve deeper understanding of the dynamics of micro and small scale economic activities and identify options for managing the enterprise transformation process with a view to realising more inclusive growth.