Dar es Salaam. President of Zanzibar Hussein Mwinyi on Friday officiated the closing ceremony of the Tanzania-EU Business Forum, reiterating Tanzania’s commitment to creating a competitive business and investment climate for the private sector development.
Inaugurated on Thursday, February 23, 2023, the two-day event attracted more than 700 participants from Tanzania Mainland, Zanzibar, and the European Union (EU).
In addition, investors from all 27 member states of the EU took part in the event alongside over 150 local investors.
It was the first-ever business forum to be organised jointly by the EU and the government of Tanzania, which saw Memorandums of Understanding (MoUs) worth EUR 1 billion signed between EU entities and Tanzania’s institutions.
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Speaking on Thursday, President Mwinyi said that the government of Tanzania is encouraged by the keen interest of several EU companies in establishing their production bases in Tanzania.
“Such initiatives will promote value-addition, skill, and technology transfer and foster a strong partnership between Tanzania and the EU,” Mwinyi told the forum’s participants.
“Through partnership and collaboration, we can transform the private sector to achieve the goal of an inclusive and broad-based middle-income economy come 2025,” he added.
The first day of the forum saw MoUs worth Sh849.98 billion signed between the government of Tanzania and different EU institutions.
The signed MoUs are the Air Service Agreement between the Government of France and the Tanzania Civil Aviation Agency and an MoU between the Port of Antwerp-Bruges International and Tanzania Ports Authority.
Other MoUs concerned the KAKONO – investment for construction of the new hydro-power plant in the Kagera region and an announcement by Knauf Gypsum Tanzania Limited Company to triple their production in the country to EUR47 million by 2025.
READ MORE: Govt, EU Institutions Sign MoUs Worth Sh850b At Tanzania-EU Business Forum
On Friday, three more MoUs were signed, which include a EUR 370 million loan by the European Investment Bank, with the EU guarantee, to local partner banks for lending to the Tanzania private sector.
From the above amount, EUR 150 million has been provided to CRDB bank, EUR 100 million to NMB bank, and EUR 20 million to KCB bank.
The local banks are expected to lend at least 30 per cent of the funds to gender companies or companies active in the blue economy sector.
Another deal that was closed on Friday involves the US$125 million senior loan facility concluded by FMO, the Dutch entrepreneurial development bank, and NMB bank.
The loan is provided in partnership with French Development Finance Institution, Proparco, contributing US$50 million to the total facility and will be used for financing MSMEs, women-owned – and agri-businesses.
FMO also closed a US$11 million NASIRA risk-sharing facility for NMB bank, which will be used to support NMB in increasing financing for micro, small, and medium-sized enterprises (MSMEs) operating in Tanzania.
Speaking at the forum on Friday, Ambassador of the EU Delegation to Tanzania Manfredo Fanti told EU businesses that what is supposed to follow now is to invest in Tanzania, outlining several reasons why the East African nation is ready for investment.
“There is a strong political drive by the government to welcome investments,” Mr Fanti, who is also the EU ambassador to the East African Community (EAC), said.
“It is evidently clear that in this country, there are many opportunities to seize, and they’re there for people who want to invest in Tanzania,” he added.
According to figures presented at the forum on Thursday, total trade between the EU and Tanzania nearly doubled from US$1.2 billion in 2019 to US$2.1 billion in 2022, accounting for 10 per cent of total trade in 2022.
The FDI stock of the EU-based companies was US$3.2 billion in 2019 compared to around US$2 billion in 2022, accounting for about 13 per cent of total FDI stock in 2022.
