DAR ES SALAAM: TANZANIA and Saudi Arabia are seeking to turn investment discussions worth more than 500 million US dollars (about 1.32tri/-) into concrete projects as Tanzania works to expand production, increase exports and narrow a trade imbalance with the Kingdom.
The discussions were held during a two-day Tanzania-Saudi Arabia Business Forum in Dar es Salaam, bringing together 47 business principals from 44 Saudi companies and institutions, 66 representatives registered by the Tanzania Private Sector Foundation (TPSF) and 19 representatives from ministries, regulators and public institutions.
Saudi-Tanzania Business Council Co-Chairman Engineer Abdulrahman Al-Thubaiti urged companies from both countries to move beyond discussions and develop concrete investments.
“We want this to mark the beginning of lasting relationships relationships that continue through meetings, develop into projects and investments, and ultimately create tangible business opportunities,” he said.
According to Minister of State in the President’s Office (Planning and Investment), Prof Kitila Mkumbo, Tanzania currently exports goods worth about 36 million US dollars to Saudi Arabia, while imports from the Kingdom are estimated at between 900 million US dollars and 1.44 billion US dollars,
Using the lower end of the import estimate, Tanzania imports about 25 times more from Saudi Arabia than it exports to the Kingdom.
“Investment is the best way of balancing the trade imbalance,” said Prof Mkumbo.
Tanzanian exports to Saudi Arabia have grown by an average of 15.2 per cent annually over the past five years, compared with 9.4 per cent growth in Saudi exports to Tanzania, he said.
Prof Mkumbo said Tanzania wanted Saudi investors to establish production facilities that could supply the domestic, regional and Saudi markets, with critical minerals, commercial agriculture, manufacturing and renewable energy among priority areas.
The government is seeking greater local processing of minerals including graphite, nickel, cobalt, lithium and rare earth elements, rather than relying mainly on exports of raw materials.
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“We do not want to mine minerals simply to export. We want to use minerals to industrialise Tanzania,” said Prof Mkumbo.
He said mineral processing and manufacturing could increase technology transfer, create skilled jobs and allow Tanzania to capture more value from its natural resources.
The government is also seeking Saudi investment in agriculture, with opportunities in commercial farming, irrigation, agro-processing and cold-chain infrastructure.
Prof Mkumbo said Tanzania had about 44 million hectares of arable land, only a fraction of which was currently being utilised.
He said Saudi investors could participate in large-scale agricultural production and processing, with products ultimately exported to the Saudi market and helping address the Kingdom’s food-security needs.
“We have a very good opportunity to provide food security for Saudi Arabia by inviting them to invest in large-scale commercial agriculture,” he said.
Manufacturing is another priority, with Tanzania seeking investment in agro-processing, mineral-based industries, machinery and pharmaceutical production.
Prof Mkumbo also called for investment in renewable energy as electricity demand is expected to rise towards 2030 and 2050.
Al-Thubaiti said Saudi Arabia and Tanzania had complementary economic strengths, with the Kingdom providing capital, expertise and technology while Tanzania offered natural resources, a strategic location and access to a growing market.
“Tanzania and Saudi Arabia are not distant partners but they complement each other. The Kingdom brings capital, expertise and technology, while Tanzania offers resources, strategic location and a growing market,” he said.
He identified renewable energy, sustainable agriculture, manufacturing, supply chains and livestock as areas with investment potential.
The forum also highlighted the need to convert expressions of interest into actual projects.
Prof Mkumbo said its success should ultimately be reflected in factories and commercial farms established, minerals processed locally, Tanzanian products reaching Saudi markets and jobs created.
He urged Saudi companies to view Tanzania not only as a consumer market but also as a production base and a gateway to wider African markets.