Dar es Salaam. In the past five years, Tanzania has witnessed a remarkable 32.4 percent increase in government investments in Public and Statutory Corporations (PSCs), as well as in minority stakes.
Going by the data from the Office of the Treasury Registrar (OTR), total investments flew from Sh65.19 trillion in the 2019/20 financial year to Sh86.29 trillion in the 2023/24 fiscal year—a testament to the government’s increasing focus on fostering a resilient economy.
Mr Nehemiah Mchechu, the Treasury Registrar, recently attributed this growth to the government’s ongoing efforts to transform public entities, with a view to boosting their efficiency and performance.
“This massive investment surge poses opportunities for growth in employment, innovation, and sectoral development,” he stressed.
This surge reflects the government’s commitment to enhancing public services and infrastructure, signaling a transformative approach to economic growth.
As the nation navigates evolving economic dynamics, this strategic investment in PSCs aims to foster resilience, drive development, and improve the quality of life for its citizens.
The OTR, under the leadership of Mr Mchechu, plays a crucial role in overseeing these investments in public and statutory corporations.
Rising Investments: A Steady climb
Over the past five years, total investments have consistently increased, reflecting a proactive approach to economic development.
In the 2019/20 financial year, the government invested Sh65.19 trillion in 287 public and statutory corporations, along with minority stakes in companies.
This figure gradually rose to Sh86.29 trillion by the 2023/24 fiscal year.
Breakdown of investments:
- 2019/20: Sh65.19 trillion (287 entities)
- 2020/21: Sh67.95 trillion (287 entities)
- 2021/22: Sh73.36 trillion (298 entities)
- 2022/23: Sh75.79 trillion (298 entities)
- 2023/24: Sh86.29 trillion (309 entities)
This upward trajectory signals a growing confidence in the public sector’s ability to drive economic growth, particularly through infrastructural projects and service delivery enhancements.
Focus on Public and Statutory Corporations
The bulk of government investments has been directed towards public institutions and statutory corporations, which have consistently absorbed a significant portion of the total investments.
For instance, in the 2023/24 fiscal year, Sh83.47 trillion was allocated to 253 institutions.
This reflects the government’s strategic focus on enhancing public service efficiency and expanding essential services to citizens.
Interestingly, while the amount earmarked for public institutions has seen steady increases, investments in companies where the government holds minority stakes have also shown a notable rise.
From Sh2.21 trillion in 2019/20 to Sh2.82 trillion in 2023/24, this sector’s growth reflects a nuanced strategy to leverage private sector partnerships and stimulate economic activity through collaborative ventures.
Minority stake investments: A dual strategy
The allocation of funds to companies with minority stakes presents an intriguing dimension of government strategy.
This approach allows the government to maintain a degree of influence while benefiting from the innovation and efficiency often associated with private sector management.
The consistent increase in funds—rising from Sh2.21 trillion to Sh2.82 trillion—indicates a deliberate effort to foster private-public partnerships, ensuring that the government can tap into private sector expertise while also bolstering national economic objectives.
The road ahead: Opportunities and challenges
As Tanzania navigates the complexities of economic development, the government’s investment strategy in public and statutory corporations, alongside minority stakes, offers a promising pathway.
However, this approach is not without its challenges.
The increasing number of entities receiving investments—from 287 in 2019/20 to 309 in 2023/24—requires robust oversight and effective management to ensure that these funds yield tangible results.
Mr Mchechu emphasizes the importance of strategic planning and accountability in these investments.
“As we move forward, it’s crucial that we not only increase our investment, but also ensure that it translates into meaningful improvements in public services and economic resilience,” he stated.
A blueprint for growth
The Tanzanian government’s escalating investments in Public and Statutory Corporations, along with a clear strategy for minority stakes, represents a forward-thinking approach to economic development.
By focusing on both public entities and strategic partnerships with the private sector, Tanzania is laying the groundwork for sustainable growth that can adapt to future challenges.
As the fiscal landscape continues to evolve, the government’s commitment to transparency, accountability, and innovation will be vital in ensuring that these investments foster not just economic growth, but also improved living standards for all Tanzanians.
