Tanzania's Top 10 Headlines [Dec 31 - Jan 6]
Arusha talks investments, central bank changes money policy, and more.
Hope you're having a great year so far.
And I'm glad you're here for the first weekly roundup of 2024!
This edition, like the previous 35, is for anyone who wants to keep up with what's "happening" in Tanzania.
It's especially useful for those of you interested in startups, technology, and investment.
Let's get into it. Yeah?
I. SUNDAY MOTIVATION
In this section, I share a thought or idea that has had the most impact – at least to me – over the last week.
So, today,
explains what it means to do business in Africa. I thought you’d be interested in his observation as well. At least if you're building a fast-growing company (startup) or investing in one.He continued, you do not have a real business unless customers are willing to pay. That's the only proof of value capture, according to Firas. It’s sufficient motivation for most founders and investors to build something people want.
However, scientists need more help turning research into startups.
Here is how
explained value creation and capture. You can also (re)read Peter Thiel's book "Zero to One" to improve your entrepreneurship skills.Now, let's get to the meat of our roundup!
II. BIG 5 HEADLINES
From December 31, 2023, to January 6, 2024, the following were the top stories in Tanzania. At least for those who do not consider celebrity gossip to be news.
1. Silabu, SmartDarasa Top African Edtech
A global intelligence platform called HolonIQ tracks the world's most innovative education technology (edtech) companies.
And guess what? Two Tanzanian startups, Silabu and SmartDarasa, made their Africa list for 2023!
Silabu (previously SmartClass) enables students to learn from each other and book tutors. While SmartDarasa is building virtual labs for schools with limited resources. They're both set to transform education in Tanzania and beyond!
FYI: In 2022/23, Tanzania allocated USD 2.4 billion to education. That amounted to 13.9% of the total national budget for all sectors. We require a similar level of commitment from the private sector. And the quickest way to get there is through edtech startups.
2. The Bank of Tanzania (BoT) Pivots Monetary Policy
wrote a major part of this headline in Swahili.One of BoT's roles is to control inflation and stimulate economic growth.
How does the BoT's interest rate affect inflation?
In countries that use this system, banks use the CBR as their "base rate" when calculating the interest rate they charge customers. If the CBR is high, the bank's interest rate will also be high.
Higher interest rates will reduce the amount of lending, and this will reduce the money supply and inflation.
How does the BoT stimulate economic growth?
If the economy is in a recession, BOT will lower the CBR. Since the CBR is the base rate, banks will also lower their interest rates. This will encourage people to borrow more, and economic activity will increase and stimulate economic growth.
This system is not intended to force banks to charge a certain interest rate. Banks will still use other factors to set their interest rates.
For this system to work effectively, credit must be a major part of people's purchases, such as buying a house, a car, or a phone.
And while this system is working, other factors must also be addressed, such as increasing production.
What does it mean for you?
Interest rate-based control of the economy unlocks the potential for increased credit access through better loan pricing from banks and digital lenders. Small and medium enterprises (SMEs), startups, and their founders may now have cheaper loans.
BoT’s ability to control the economy via interest rates unlocks the potential for increased credit access. Bank loans for small and medium-sized enterprises (SMEs) and startups may now be more affordable.
3. NHIF Prices on Hold, Minister Scrambles for Solution After Private Hospitals Threaten Boycott
The National Health Insurance Fund (NHIF) suspended its controversial new price scheme for medical services at private hospitals. This followed a tense meeting with stakeholders on January 4th, according to MedicoPRESS.
What happened?
NHIF’s prices, scheduled to take effect on January 1st, 2024, caused outrage among private hospitals, who threatened a boycott of NHIF card holders.
This prompted a roundtable meeting with Health Minister Ummy Mwalimu, CSSC (Christian Social Services Commission), APHFTA (Association of Private Health Facilities in Tanzania), and BAKWATA (National Muslim Council of Tanzania) to address the concerns.
After extensive discussions, the Minister:
Suspended the new pricing scheme.
Established an independent commission to review the prices.
Why the standoff?
Private hospitals argued the new prices were too low and would strain their finances.
They also raised concerns about:
Delayed NHIF payments (up to 3 months)
High deductions (5-40% of monthly bills) without proper verification.
Multiple healthcare fees conflict with the Prime Minister's Office directives.
A new ultrasound fee imposed by the Radiation Board, adding to the cost of care.
Impact:
The standoff risked reducing access to healthcare for NHIF members as private hospitals might opt out of the scheme.
Reduced consultation fees for specialists and super-specialists could compromise service quality at top hospitals.
4. Africa's Largest Hydro Dam Nears Completion in Tanzania
A massive hydropower plant, named after Tanzania's first president, is 94% complete.
The Julius Nyerere project, abbreviated as JNHPP, will boost the country's electricity generation by over 100%.
Construction began in 2019 and cost US$2.9 billion. It’s already generating power for testing, with a 25% increase in capacity just from the first two turbines!
The JNHPP is located on the Rufiji River, the dam will be 130 meters tall and 1,025 meters long. It will hold 33 billion cubic meters of water and generate 2,115 megawatts (MW) of electricity.
In addition, construction involved 4 million cubic meters of excavation and 2.6 million cubic meters of concrete.
The dam provides several benefits for Tanzania. These include:
Significant increase in clean energy for the national grid. Powering homes, businesses, mines, and industries.
Reduced reliance on expensive imported fuel.
Job creation and economy boost.
FYI: Tanzania has a hydropower capacity of 562 MW, according to the US International Trade Administration. The potential capacity is estimated to be as high as 4.7 GW. So, there's still work to be done!
ConstructAfrica and Michael Strain contributed to this headline.
5. Arusha Wants to Be More Than a Tourist Destination
Arusha DC officials met with Salmin Africa, an expert firm that assists with finding funds, attracting investments, and navigating international trade. Together, they dissected investment possibilities.
The district council’s investment profile reveals exciting opportunities in key sectors like agriculture, tourism, and infrastructure. If you have the desire and the means, you can:
Utilize fertile land for food and cash crops like maize, beans, coffee, and horticultural products.
Invest in processing machinery and improve market access for farmers.
Develop roads, utility systems, and supporting infrastructure for national parks.
Modernize and expand the Gomba area with residential houses, markets, and bus stands.
Develop hotels, museums, amusement parks, and recreation centers near scenic attractions like Laroi Crater and Napuk Waterfalls.
Build hostels, entertainment spots, and other relevant facilities near the Nelson Mandela African Institution of Science and Technology (NM-AIST), and Mzumbe University Arusha.
Develop sports and leisure centers in the Burka area.
Improve grazing land at Ilkurot, construct a modern slaughterhouse, and offer animal fattening, and dairy/meat processing.
Further inquiries can be directed to the Arusha District Council via ded@arushadc.go.tz.
III. ADDITIONAL HEADLINES
Below are some of the shorter news updates that influenced Tanzanian development this week.
The Kairuki Hospital deployed a High-Intensity Focused Ultrasound (HIFU) machine. It now offers a non-surgical approach to tumor/cancer treatment.
Taifa Gas, led by Tanzanian entrepreneur Rostam Aziz, has continued construction of a liquefied petroleum gas (LPG) facility in Mombasa, Kenya. This project will enhance access to clean and affordable energy in the region. Source: The Citizen’s Paul Owere.
Multi Cable Limited, a leading Tanzanian manufacturer of electronic equipment, is poised to expand its reach by supplying electrical cables to the East African Community (EAC) and Southern African Development Community (SADC) regions. The company currently provides cables for the Tanzania Electric Supply Company (TANESCO) and the Rural Electrification Agency (REA). In addition, its product portfolio includes electronic transformers and meters. Source: Rosemary Mirondo of The Citizen.
Arusha Regional Commissioner (RC) John Mongela participated in a 3D printing workshop at the Arusha Science School. Tesla’s Eng. Walter Minja led the training, as confirmed by Dr. Jabhera Matogoro of the Dodoma-based AI4D Research Lab.
Founders Tanzania, a grassroots community of innovation champions, startup directory. Today is the last day for public edits. And the database will be constantly updated with verified information.
IV. CONCLUSION
Thank you for taking the time to read!
Atoms & Bits roundups can now be discussed with friends and colleagues in Tanzania's startup ecosystem. Thanks to a collaboration with Founders Tanzania. Simply tune in on Mondays at 5 PM via meet.google.com/nri-bnvv-ywy.
Another reminder: I also write a column called "Silicon Bongo" for The Citizen. It is published/printed every Tuesday. Check it out if you want to hear my thoughts on Tanzania's innovation ecosystem.
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Kazi Iendelee!