Private sector wish list to boost and transform horticulture sub-sector in Tanzania

Dar es Salaam; 12th December 2012
Tanzania’s horticultural industry investments and development faces
multifaceted challenges that need to be urgently addressed through
public private partnership for best solutions as matter of necessity.
Participants at a horticulture stakeholders’ incentive meeting held in
Dar es Salaam ( 7th December 2012) noted that inadequate support
policies and regulatory framework exacerbated by poor infrastructure
and insufficient operational procedures only serves to diminish the
sector’s competiveness.

Presenting a wish list to the government to create an enabling
environment for accelerating horticultural development in the country,
stakeholders called for improvement of transport sector to enable
farmers to access both local and international markets.

The Ministry of Agriculture Food Security and Cooperatives in
Collaboration with collaboration with Tanzania Horticulture
Association (TAHA) and other stakeholders are working together to find
common ground in addressing some of the challenges.

Poor infrastructure
“More than 80 percent of Tanzania’s horticultural export is airlifted
through Kenya due to lack of unreliable services at Tanzanian
airports,” said TAHA Executive Director Ms Jacqueline Mkindi. She
added that local airports hardly have any flights for cargoes.
The situation has resulted into increased cost of doing business for
the industry, where traders have to pay for added transport cost up to
Nairobi. Also local market and road transport infrastructure, despite
some improvements many challenges remains.

Lack of access to finance
Very limited access to finance by farmers is also a big challenge;
stakeholders noted but expressed hope that the newly established
Agricultural Bank can address them, it adopts strategies to  reach out
to  small scale farmers.
Poor coordination
There is a need of improved coordination within the government
specifically between ministries or institutions which provide services
to private sector.  (THIS NEEDS ELABORATION).

Levies and taxation
Stakeholders called for the  government to abolish produce cess and
retain service levy, abolish VAT and duty on agro-inputs such as
irrigation pipes and agro nets, review land rent rates and redefine
urban and village farming.

Government concerned as well
Addressing the meeting, Permanent Secretary in the Ministry of
Agriculture, Food Security and Cooperative Mr Mohamed Muya said that
the government was aware of the urgent need to improve the present
incentive regime to facilitate smooth operation of agricultural
sector.
He said the government has started to address the challenges
surrounding policy environment, including more recently amendment of
Finance Act to accommodate the needs of horticulture.
“The benefits provided in the amendments include VAT relief on
agro-nets, greenhouses for horticulture, generators and water pumps
used in irrigation, goods and services for building irrigation canals,
construction of road networks, godowns and similar storage structures
among others
He added that  government has taken various measures to ensure smooth
operation of the industry including providing exemption on importation
and use of plastic bags for packaging of horticultural export produce,
engaging our government counterparts in Kenya to address Non-Tariff
Barriers issues affecting horticultural trade such as import levy,
road toll and transit fees.
“These endeavors underscore the commitment of the government in
building good environment for operation of horticultural operators but
it still recognizes that more efforts need to be undertaken to further
facilitate enabling environment in horticulture,” Mr Muya said.
TAHA presented two reports financed by BEST AC  on proposed Incentives
to boost and transform horticulture sub-sector in Tanzania. First
report involved compiling a wish list of incentives to spur up
horticulture industry, while the second was about developing evidence
on the potentials of the horticultural industry at local government
levels.

Notes to editors
Established in 2004, Tanzania Horticulture Association (TAHA) is an
apex Private Sector member based organization dedicated and committed
to develop and promote horticultural industry in Tanzania. One of the
key areas that TAHA is focusing on is to ensure a conducive business
environment for horticultural businesses.
BEST-AC is a grant programme that assists business membership
organisations to create a better business environment. The grants
enable these organisations to be successful in their dialogue with
government to change policies, laws and regulations. BEST-AC is
responsible for the effective and efficient design, development and
delivery of the Private Sector Advocacy (PSA) Fund provided through
grants from the governments of Denmark (through Danish International
Development Assistance, Danida), the Royal Netherlands Embassy, Sweden
(through the Swedish International Development Agency, SIDA) and the
United Kingdom (through the Department for International Development,
DFID). COWI Denmark management consultants manage BEST-AC.