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All eyes trained on new budget

ALL attention will be in Dodoma as the government tables the 2018/19 budget today amid growing optimism by some Members of Parliament (MPs) on the future prospects from robust economic growth and improved infrastructure.

The government plans to raise 32.5tri/- for the next financial year to improve social services and continue financing major energy and transport infrastructure to spur economic growth and development.

The FY 2018/19 budget will finance the third year of the ambitious Five- Year Development Plan II (2016/17 - 2020/21) which focuses on transforming the nation from an agriculture-led economy to a semi-industry by 2025, finally taking the country into a middle-income status.

The budget will be read as construction of a standard gauge railway to link the Dar es Salaam port with Mwanza on Lake Victoria and Kigoma on Lake Tanganyika, as well as neighbouring Rwanda and Burundi is gaining pace and the revival of the national carrier, ATCL through fleet modernisation continues.

The government is also in final stages of preparations to begin construction of a $3.5bn East African crude oil pipeline project, the 1,403km pipeline to transport crude oil from Hoima in Uganda to Tanga Port will be constructed jointly with the Ugandan government.

Tanzania is also in final preparations for construction of the Stiegler’s Gorge hydroelectric project billed to add 2,000MW of electricity that will assure the nation reliable power supply to boost its industrialisation drive.

The economy is expected to grow by 7.2 per cent in 2018, up from around 7.1 per cent last year, underpinned by vibrant activity in mining, transport and communication sectors, Dr Mpango said recently here.

He told MPs that inflation rate in 2018 would be “tamed at single digit levels.” The fiscal deficit will reach 3.2 per cent of gross domestic product (GDP) in the 2018/19 fiscal year (July-June), up from around 2.1 per cent in 2017/18, he said. Inflation declined to 3.6 per cent year-on-year in May from 3.8 per cent year-on-year in April, as food prices continued to fall. Some MPs interviewed expressed optimism for further growth and development as the economy grows strong and energy and transport infrastructure steadily improve.

They said they expect the budget to be more pro-growth and continue from where the 2017/2018 budget will end financing major development projects to promote growth and development and improve social service delivery.

Hussein Bashe (Nzega, CCM) said he expects a budget that will stimulate economic growth and boost businesses with a broadened scope on boosting productivity in various sectors.

“My hope is that the new one would stimulate growth and boost productivity instead of focusing on tax collection ... the government must shift from tax oriented to production oriented budget,” he said.

More emphasis is also needed to improve the business environment and improve the country in the rankings of ease of doing business, he said.

He said the government needs also to remove 15 per cent with-holding tax on soft drink plants to ease a huge burden on them, he said.

Livingstone Lusinde (Mtera, CCM) said the government must overcome the problem of under-delivery of budgetary allocations particularly on development budgets to ensure development goals were met.

He said the main challenge on the 2017/18 budget was that budgetary allocations were not fully implemented which undermined efforts to meet planned development needs.

“Funds from development budget should be delivered as they will be allocated,” he said. Deo Sanga (Makambako) said the government and President John Magufuli need to be commended for implementation of major development projects as outlined in the Development Plan.

He said it needed a bold leadership to ensure that the key energy and infrastructure projects such as construction of a standard gauge railway and revival of ATCL were being implemented through domestic resources.

Mr Sanga said many things have changed for better with the revival of the national carrier, ATCL and improvements of airports in various regions that have enhanced competition in air transport, improved standards and lower air ticket prices.

Meanwhile, economists told the ‘Daily News’ that Tanzanians expect the government to allocate more fund in major development projects.

Prof Humphrey Moshi said he expects the government to allocate more funds to sectors and infrastructure projects that will spur the country’s industrialised economy.

“It is also my hope that we will continue to invest in education and vocational training to produce people who will work in these industries,” the economist told this paper in an interview.

A senior economics lecturer at Mzumbe University (Dar es Salaam Campus), Prof Honest Ngowi, was of a view that the budget estimates will not be so different from previous budgets, only that this time round the government aims to inject more funds in development projects.

“The only thing people are eagerly waiting to hear is tax measures to be announced by the government in the next fiscal year; I do not, however, expect dramatic changes in tax measures,” Dr Ngowi stated.

An economist and lecturer at the University of Dar es Salaam (UDSM), Prof Haji Semboja, was of a view that the financial plan will dwell much on strategies which have been outlined by the government towards the middle-income economy.

Unlike in the past, Prof Semboja explained, the government was now focusing on reducing funds for consumption and instead investing in development projects which are crucial for economic growth.

The economist proposed further for expansion of the tax base to reduce over reliance on taxes alone and instead look into other non-tax revenues.

TANZANIA’S Chief Justice (CJ), Prof ...

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Author: DAILY NEWS Reporters in Dodoma

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