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‘A certain president Magufuli’ – Part III

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The focus of my articles has been to highlight African leaders who in diverse ways are making a visible positive difference in their countries, by being efficient and firm, cutting down wasteful spending and bringing about desirable transformation. Power, it is said, lies in the hands of the electorates……being the masses, the average citizen with the power to vote! Thus during electoral campaigns, the relatively ‘fewer politicians’ go round campaigning and do all manner of ‘wonders’ to convince electorates to vote them into power.

Usually, the understanding is that the politician is very much abreast with the needs of the electorates, and so by voting them into power; the electorates are assured that their interests will be served. However by some means, once some of these politicians are voted into power, the power now falls into the hands of the elected politicians! And they take decisions ‘on our behalf ’, some of which are very much mind boggling! At a point, selfishness, greed, complacency, arrogance, pride and the corrupt tendencies that come with having power, come to take over.

By some interesting means, some politicians now become so powerful at a point that they fail to identify with the ‘grassroots’, the very electorates who voted them into power! They become inaccessible, untouchable, almost like demigods!

As human as the average politician is, I believe they tend to think of their own welfare and their immediate families first (very much) before considering the interest of the electorates (that is, if we are even lucky to feature on their list in the first place). I guess that is why the average politician will be more interested in projects that will guarantee some ‘kick-backs’, even if it may be of little value to the nation as a whole.

Some waste the taxpayer’s money in unimaginable ways. If only our leaders will manage the economy and public purse like it is their personal business and personal purse respectively, maybe….just maybe, our fate will be different.

…But I believe it is not the case that all politicians or leaders fall into this ‘power abuse trap’. There genuinely are some out there who are leading their countries with a different heart, mind and attitude. It is evident that we do not lack good leaders, but rather the issue is with the ability of such good leaders to live up to expectations. I have praised Presidents John Magufuli of Tanzania and Paul Kagame of Rwanda in my previous articles. It challenges me to look further across the continent to identify other leaders who are challenging the status quo and doing things differently.

But, even before I set off, thoughts of the likes of Yahya Jammeh of Gambia, Robert Mugabe of Zimbabwe and Joseph Kabila of the Democratic Republic of Congo comes rushing to mind to kill the enthusiasm and hope. All three of them are by some means trying to hold on to power without true merrit.

• Gambia’s Yahya Jammeh has refused to step down despite losing the December 1 election to Adama Barrow. There was wild jubilation in Gambia because at long last, their 22 years of strife and persecution had come to an end. Interestingly, Yahya Jammeh initially conceded defeat; only to denounce it a week later and demand a new vote!

• Just in case you didn’t know, Zimbabwe’s Robert Mugabe at a ripe age of 92 years will stand to be elected as president again in the country’s 2018 election after his ruling ZANU-PF party endorsed him at their annual conference.

• In Congo, Joseph Kabila was to step down in 2016 as required by the constitution. However, he has extended the election to April 2018, to allow him to remain in power and eventually change the constitution to allow him to legally compete for another term in office! Just to recap briefly…

President John Magufuli of Tanzania, since taking office in November 2015, has intensively cracked down on government wastage, inefficiency and corruption; and is ultimately driving an exciting transformation in Tanzania. Just this New Year of 2017, President Magufuli has fired the Head of Tanzania’s electricity company for raising tariffs by 8.53 percent! The company did this in an attempt to stem losses but the president believes the tariff hike would hinder his plans to industrialize the country. In any case, why glorify inefficiency with the ability to raise tariffs?

President Paul Kagame of Rwanda is also celebrated internationally for his efficiency and effectiveness in steering Rwanda’s impressive economic growth, since taking office in 2000. Many regard him as one of the 20th century’s most effective military leaders.

Here in Ghana, Nana Akuffo Addo of the National Patriotic Party (NPP) won the December 7, 2016 elections with a 53.85 percent majority vote. The NPP during its campaign consistently spoke out against the incessant acts of corruption and incompetence on the part of the ruling National Democratic Congress (NDC) government. Many Ghanaians are keenly observing to see if the NPP’s campaign promises (for which the average Ghanaian voted them into power) can be brought to fruition.

I am also keenly observing to see if the NPP government will take bold strides to match their words with actions and strive to weed out corruption, incompetence and wasteful spending from the system. The new president needs to be firm and able to exert his influence to get these done. People must be held accountable irrespective of their political affiliations, but especially among his NPP party members! Ghana badly needs a visionary and transformational, disciplined and firm leader at the helm of affairs.

If for nothing, we now know that it can be done, thanks to President Magufuli of Tanzania! Can a Ghanaian president strive to do anything similar to what he has done so far, even if it displeases his party members? A few unsolicited suggestions to the New President …

• Can we scrap our 6th March independence Day celebrations? I am in pains to identify what impact or benefits have been gained from these celebrations over the years.

• Can the ruling government cut down on the frightening levels of importation and use of the fuel-guzzling vehicles (especially the Toyota Land Cruiser V8’s) as the official government vehicle all at the taxpayer’s expense, while the average taxpayer can barely make ends meet?

• Can we as a nation embark on some serious cost-cutting measures, especially those on extravagant and frivolous activities; and rather use the monies saved for more beneficial purposes such as equipping our healthcare facilities with the best equipments and medications, equipping our schools with the needed equipments, text books and other study materials, etc?

• Can we, as a country, begin some serious work against our habitual Ghana-ManTime lateness? Can we see this discipline start at the very top to effectively trickle down to the masses at the bottom?

• Many more suggestions lingering on my mind…..thanks to the exploits of President Magufuli which makes very good sense.

President John Magufuli’s leadership is an indication that all is not lost. Are our African leaders paying attention and learning anything from him? In 2017 and beyond, we hope to celebrate more transformational and exemplary leaders who are a beacon of hope for the African continent as a whole.

 

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Tanzania

Tanzania’s economy to grow by 6.8% in 2019

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The World Bank suggests Gross Domestic Product (GDP) growth in Tanzania to likely slowdown to 6.6% for the year 2018 from a 7.1 per cent expansion in 2017.

This year 2019, the Bank estimates that Tanzania’s economy will grow by 6.8 per cent and rise to 7.0 per cent in 2020.

But the government expects Tanzania’s economy to grow by 7.2 per cent in 2018 and accelerate to 7.3 per cent in 2019, despite a slowdown in credit to the private sector and rising bad loans in the country’s banking sector.

The state-run National Bureau of Statistics (NBS) said in December that Tanzania’s GDP grew by 7.0 per cent in the first half of 2018 from a 6.7 per cent rise in the same period a year-ago, while the country’s inflation rate dropped to a 10-year low in November, helped by slower rises in food prices.

National Bureau of Statistics – Tanzania

“In fast-growing countries, such as Rwanda and Tanzania, the (economic) expansion will be supported by public investment in infrastructure and strong agricultural growth,” said the World Bank in it 264-page report.

“Inflation is expected to pick up across the (Sub-Saharan Africa) region in 2019, reflecting the pass-through of currency depreciations during 2018 and domestic price pressures among metals exporters and non-resource-intensive countries … price pressures are likely to intensify in Kenya, Tanzania and Uganda.”

Tanzania’s annual headline inflation rate rose marginally to 3.3 per cent in December from 3.0 per cent in November, the lowest inflation in a decade.

The International Monetary Fund (IMF) warned last month that a credit squeeze coupled with a slowdown in government spending could dampen prospects for faster economic growth in Tanzania.

The lender, which warned that nearly half of Tanzania’s 45 banks are vulnerable to adverse shocks and risk insolvency, forecast the economy by 6.8 per cent this year.

The government plans to raise spending by 2.4 per cent in the 2018/19 fiscal year with the fiscal deficit expected to increase on the back of higher infrastructure spending.

The fiscal deficit is seen reaching 3.2 per cent of GDP in 2018/19 fiscal year (July-June), up from around 2.1 per cent in 2017/2018, according to data from the Ministry of Finance and Planning.

Elsewhere, the growth of the global economy is expected to decelerate to 2.9 per cent this year compared with the three percent in 2018, the World Bank said in the report, citing elevated trade tensions and international trade moderation.

A slump in the global economy will continue in the coming year, with 2020 growth estimated at 2.8 per cent, according to the report.

“Risks to the regional outlook are tilted to the downside. On the external front, slower-than projected growth in China and Euro Area, which have strong trade and investment links with Sub-Saharan Africa, would adversely affect the region through lower export demand and investment,” the World Bank said.

“Moreover, Sub-Saharan African metals producers would likely be among the hardest hit by escalating trade tensions between China and the United States, as metals prices would fall faster than other commodity prices as a result of weakening demand from China.”

Sharp currency declines would make the servicing of foreign currency-denominated debt, already a rising concern in the sub-Saharan African region, more challenging, the Bank said.

Overall, real GDP growth is estimated 6.6% in 2018, down from 7.1% in 2017. The services sector was the main contributor to GDP (39.3%). Private investment was the main demand-side contributor (63.9%). The external sector stymied economic growth as the current account deficit increased (despite the real depreciation of the Tanzanian shilling), due to a higher volume of imports in 2018 than in 2017. The increase is due largely to increased imports of transport equipment, building and construction materials, industrial raw materials, and petroleum products for large public investment projects, such as the Standard Gauge Railway. The import bill also increased as a result of the rise in the price of key commodities, such as crude oil.

The fiscal deficit increased to an estimated 3.9% of GDP in 2018, due to increased capital spending on infrastructure projects. Public debt increased to an estimated 39.3% of GDP in 2018 from 38.2% in 2017. External debt accounted for about 74.9% of total public debt in 2018. The risk of debt distress remains low because public external debt, at 34.5% of GDP, is mostly concessional.

Monetary policy was more accommodative in 2018 than in 2017. This increased domestic liquidity and reduced lending rates, leading to greater private credit supply. Due to improved food supply, inflation eased to an estimated 3.5% in 2018.

Tailwinds and headwinds

The medium-term outlook is positive, with growth projected at 6.8% in both 2019 and 7.0 in 2020, supported by large infrastructure spending. Headline inflation is projected to marginally increase to 5.2% in 2019 and 5.1% in 2020 due to increased government spending.

But the positive outlook faces several downside risks: growing private sector concerns about economic policy uncertainty and increased domestic arrears that could derail the government’s fiscal consolidation and harm the private sector.

Key economic development challenges include slow progress towards inclusive growth, infrastructure bottlenecks, and vulnerability to climate change. Poverty and income inequality remain high despite high economic growth. Infrastructure bottlenecks are most notable in the transport and energy sectors. Reliance on rain-fed agriculture has exposed farmers to income shocks. And inefficient public enterprises present a fiscal risk. One of the development challenges on the social front is youth unemployment, which increased to 7.3% in 2016, compared with 5.7% in 2012.

Key opportunities include peace and political stability, abundant natural resources, a strategic geographic location, and immense development potential for tourism. The Export Zone Processing Agency established in 2008 to accelerate manufacturing exports and help the country achieve structural transformation has helped attract close to $1 billion in foreign direct investment and revive the manufacturing sector into one of the fastest growing in Africa.

 

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