Eyes On The Target

How would you assess the current level of bilateral cooperation and economic relations between Singapore and Tanzania?

It has never been better. President Jakaya Kikwete’s visit to Singapore in June 2013 generated new momentum in our bilateral relations. Since then, we have inked four Memorandums of Understanding (MoUs) and an Open Skies Agreement. President Kikwete and Prime Minister Lee Hsien Loong also had a chance to speak over the course of the Commonwealth Heads of Government (CHOGM) Summit in Sri Lanka in November 2013. I myself had the good fortune to visit Dar es Salaam in June 2014 with a Singaporean business delegation for the Tanzania-Singapore Business Forum, and the rapid pace of development in the country impressed us all. Needless to say, we felt very welcomed. Tanzania’s huge potential is reflected in our bilateral trade, which has risen steadily in recent years (SGD187.7 million in 2013). Singaporean companies are now present in the coal, agriculture, shipping, and steel sectors in Tanzania. Our businesses have also shown increased interest in understanding and exploring the Tanzanian market. The Singapore Business Federation, for example, has organized two business missions to Tanzania since 2013. Tanzania also participated in the recent Third Africa-Singapore Business Forum, a major platform that drew more than 600 top businessmen from Africa and Singapore.

Highlighted by Pavilion Energy’s $1.28 billion investment in Tanzania’s energy sector, Singaporean investors are beginning to look beyond Asia toward Africa. What opportunities are there for such investors in East Africa, and especially Tanzania?

East Africa is attractive to investors due to its relative stability, the abundance of arable land, and the availability of natural resources. More recently, oil and gas finds have encouraged more foreign investment. Tanzania is a suitable investment destination for companies, due to its political stability and recent economic reforms. Companies already doing business in Tanzania should explore opportunities in moving up the value chain in the long term. Oil and gas companies can explore developing downstream activities such as refineries, while agriculture companies could introduce agri-technologies, such as fertilizers and other machinery. Beyond natural resources, I believe the next phase of growth will be driven by the region’s youthful population and burgeoning middle class.

Besides the energy sector, which other sectors in the economy have you identified as having the most potential for cooperation between Singapore and Tanzania?

There are numerous areas of potential. The first is education. Tanzanian policymakers understand that the development of human capital is vital for the country’s long-term economic development. They have identified vocational education as a key sector for job creation and have directed significant resources toward improving the national education system over the past decade, with public expenditure per student more than doubling since 2005. There are ample opportunities in this regard for Singaporean companies, such as Informatics Education and the Institute of Technical Education (ITE), to establish themselves in Tanzania and the broader East African region. The area of transport and logistics has also emerged as a key sector. Tanzania’s proximity to Asia makes it the natural transhipment gateway to inland Africa for Asian products. Given Singapore’s port and logistics expertise, a number of opportunities are present for Singapore to further boost the connectivity inside and outside of Tanzania. Finally, the public sector also presents opportunities in capacity building, and e-government services are another possible area. Singapore’s experience in public sector management and the design and implementation of e-government systems is highly relevant in this sector. East Africa is one of the most connected regions in Africa. Governments are embarking on projects to not only improve their business environment, but also to become more transparent.