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Connecting the dots in Tanzania?

Thursday 5th February 2015

Tanzania World Bank

Connect the World Bank, loss of donor income and revision of hunting concessions…

 

There are times when seemingly disparate events add up to a bigger picture. Recently, a World Bank report about tourism in Tanzania, an announcement that the Tanzanian government will review all hunting concessions in 2018, and “irregularities” in Tanzania’s energy sector all seem to come together in an unexpected outcome that might benefit wildlife conservation.

Let’s face it, Tanzania has not done well to conserve her wildlife heritage. Last year, we had reports about the decimation of elephant populations in the massive Selous Game Reserve thanks to poachers, indications that UAE holders of hunting concessions were completely out of control in terms of obeying the laws of Tanzania, that Tanzania remains a major export route for the illegal wildlife trade especially in ivory, that well-placed individuals in Tanzania are allegedly heavily involved in the illegal wildlife trade, that exports of illegal ivory were allegedly facilitated by visits of Chinese Navy ships and a Chinese Presidential aircraft – etc.

But how are the reviews of hunting concessions, the World Bank and the Tanzanian energy sector connected?

Let’s start with the energy bit.

According to the Reuters News Agency:

“A group of 12 international donors have delayed budget support for Tanzania until findings of an investigation into charges of corruption in the energy sector are released and appropriate action taken, a leading donor said.

Tanzania has made big discoveries of natural gas, but its energy industry has been dogged by allegations of corruption in the past. Businesses have long complained graft[corruption] is one of the main reasons for the high cost of doing business in Tanzania.

The government denies the charges of graft[corruption] related to the energy deal in question. It says it investigates all such allegations and comes down firmly on any cases uncovered.

The donor group - comprising Finland, Germany, Britain, Norway, Sweden, Denmark, the European Commission, Ireland, Canada, Japan, the World Bank and the African Development Bank - has so far paid $69 million of $558 million pledged, said Kati Manner, head of cooperation at Finland's Embassy in Tanzania.”

Tanzania “expects” donors to contribute about 15 percent in both grants and concessionary loans to its 2014/15 fiscal budget – so the shortfall of $489 million is a heavy burden to bear.

Now let’s move on to the World Bank Report.

 

The World Bank is a major lender to Tanzania, and regularly makes reports about the economy of that country. The most recent report looked at the tourism industry, and came to the not-surprising conclusion that Tanzania was underperforming in terms of potential. The Wold Bank said that tourism in Tanzania mainly went to beaches in Zanzibar, Mt Kilimanjaro, and some northern parks like Serengeti and Ngorongoro. To the detriment of many other beautiful national parks and other beach locations.

In addition, the World Bank also mentioned problems with the withdrawal of funds from international donors. The WB said Tanzania was trying to compensate by stripping pension funds and defaulting on loans. Not a good practice.

The WB also mentioned that highly substantial amounts of government income were not realized via non-payment of VAT. In fact, the WB said Tanzania performed worse than other countries in Africa like Madagascar and Burkina Faso in realizing VAT payments. The WB report did not speculate on the reasons, but corruption is the most likely suspect.

The WB strongly advised Tanzania to look more closely at the huge potential of tourism. Vastly underutilized and needing state support to realize potential not only for government but also rural populations, of which currently 40% of which earn less than the “official” poverty rate of $1.25 per day, the WB identified expanded tourism as an engine of growth for the national and local economies.

Tourism currently employs ½ million people and is the major foreign income earner for Tanzania according to the WB. However, the WB report says this:

“First, while tourists are ready to spend a considerable amount of money to visit Tanzania, a portion of this spending remains abroad. This has to be expected, and Tanzania is not an outlier, as most tourists are foreigners and book their holidays through pre-arranged package tours.

Second, tourism is focused almost exclusively on two areas - the northern circuits around Arusha and the island of Zanzibar - which explains why linkages have remained limited across the country.

Third, even around the most visited areas, poverty is prevalent, particularly near the Serengeti National Park, indicating that strong linkages with local communities have yet to be established.

Fourth, while the tourism sector has been expanding rapidly, it has not created enough high value jobs for citizens in recent years, either directly or indirectly.

Finally, an unpredictable and complex taxation system has discouraged investors, while non-transparent redistribution mechanisms have made it almost impossible to track the use of revenues collected from the tourism sector.”

Not a good report for Tanzania – high potential is not being translated to actual earnings. And this tourism income is not benefiting conservation.

The WB report has much more to say, and I would encourage reading the entire report here:

Tanzania to review all hunting concessions in 2018.

A recent newspaper report indicated that Tanzania would take a closer look at all the land presently allocated to hunting concessions. Estimated at 250,000km2 of Tanzania’s total land area, these lands have been estimated to be the least economically productive use of land compared to all other uses. Photographic tourism, for example, brings in twice the amount of income than hunting concessions and very substantially more permanent employment.

Tanzania is also set to change the current wildlife authority – TANAPA – to a more independent authority called the Tanzania Wildlife Authority. Instead of concession fees, trophy fees, etc going to the central treasury (and not benefiting wildlife), TAWA might have the needed ability to collect income from wildlife utilization to ensure better wildlife conservation. Under the current system, wildlife rangers cannot patrol, only sometimes receive their meagre salaries and are corruptible by poachers. And communities living with wildlife earn a pittance and are not compensated for any damage caused by wildlife.

Tanzania seems to have woken up to this financial reality. The newspaper report says:

“For his part, the Minister for Natural Resources and Tourism, Mr Lazaro Nyalandu, revealed that the Tanzania Wildlife Authority (Tawa) is to start its full operation next month.

Tawa will be tasked with a number of obligations, including reshaping wildlife management and conservation.

"The task of changing ownership of tourism hunting blocks is to be carried-out by Tawa, which has been given a mandate to change policy and the use of the country's game reserves," the minister said.

Mr Nyalandu was responding to a supplementary question by Mr Maselle (CCM), who wanted to know the government's plan to change all game reserves into other uses.”

This cannot happen until 2018 as contracts for many hunting concessions have already been awarded.

Reform for Tanzania?

 Tanzania needs much reform to honestly engage in wildlife conservation. Perhaps facilitated by a number of NGOs and other vested interest groups, current resource utilization seems to be mining the wildlife resource for short-term gains rather than stressing consistent and sustainable benefit.

So let’s hope that via pressure from donors to clean up Tanzania’s finances, the WB report urging the same and mentioning problems and solutions to Tanzania’s current utilization of wildlife resources, and re-evaluating the consumptive and destructive influence of Tanzania’s current trophy hunting industry – change will come.


Picture credit: www.pic2fly

Add a comment | Posted by Chris Macsween at 18:32