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  • Tanzania: Choosing between cashew parastatal and private buyers

    Apr 17th, 2012

    <p></p><p>The story here last week was about ‘privatisation-gone-haywire: what next for hapless Tanzania?’ Two decades down the road, the privatisation programme which was implemented with gusto that was unmatched by prudence, has unravelled, exposing serious weaknesses... The sad part of it all is that the weaknesses were largely founded on human foibles and, as such, could have been avoided through due diligence and unquestioned probity among the programme implementers, spearheaded by our development planners and decision-makers.</p> <p>That never happened in large measure. For example, an audit by the Controller &amp; Auditor-General (CAG) of 62 privatised parastatals (out of the 336 parastatals which had been privatised by 2009) showed that only 12 of them were performing reasonably well! According to CAG, an analysis of the privatised entities showed that 80 per cent of the intended (privatisation) goals hadn’t been reached! </p><p>While another 23 of the 62 surveyed privatisations had collapsed entirely, 27 others were moribund, needing the equivalent of financial intensive care. [: May 24, 2010]. If that was the situation nearly two years ago, what’s it like today? I don’t profess to know that with any degree of certitude! But, judging by recent reports on the country’s cashewnut sub-sector, things must have regressed, going from bad to worse... </p><p>Look at it this way... There’s recently been a spate of press reports from different quarters on the state of Tanzania’s cashew nut ‘industry.’ Some of those relate to a working tour of a notable cashew nut producing part in south-east Tanzania by the national chairman of the opposition political party NCCR-Mageuzi, James Mbatia, March 4-14 this year. </p><p>At the end of the day, Mbatia wrote to Prime Minister Mizengo Pinda detailing the woes bedevilling cashew farmers in particular. [Tanzania Daima: Mar. 20, 2012]. In like vein, the chairman of the Consolidated Holdings Corporation (CHC) said two out of the 12 privatised cashew nut shelling firms are functioning today. The managers/owners of the rest of the firms have turned their premises into storage facilities for assorted goods that usually have nothing to do with the cashewnut business! </p><p>This has reportedly become the order of the day partly because of inadequate and reliable water and electricity supplies, as well as lack of financing! [So, why were they privatised at all, still less so to new owners who didn’t /don’t have the requisite wherewithal with which to run them? Why? I ask you!]. CHC is in the best position to know what’s going on, especially post-the privatisation programme that went haywire! The corporation in peaked at 155,000 tons this year. According to the CHC acting chief executive officer, Dome Malosha, this is the highest output since the country attained independence from foreign rule 50 years ago! </p><p>But then, again as the very same Sisters of Fate would determine a cashewnut shelling capacity (kubangua korosho) currently stands at only 4,000 tons a year! The two privatised factories that are still operating (‘Newalla-II’ and ‘Tunduru’) reportedly have an installed capacity of processing 10,000 tons a year. </p><p>But for lack of adequate water, power and funds each can currently process only 2,000 tons! In the event, Tanzania stands to lose heavily from its cashewnut sub-sector primarily because of the shoddy privatisation of a $145 million industry that was doing reasonably well as a parastatal. [The Citizen: Mar. 26, 2012]. Tears! </p><p>&nbsp;</p><br><p></p>


    Source: http://thecitizen.co.tz
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