Dar mulls greater self-reliance as MCC suspends partnership

KATARE MBASHIRU and ROSE ATHUMANI

THE suspension of partnership with Tanzania as decided by the Board of Directors of the Millennium Challenge Corporation (MCC) may not immediately affect the country’s development projects, it has been observed.

According to a statement from the United States Embassy in Dar es Salaam, the corporation’s board has decided to cease all activities related to the development of a second compact with Tanzania, according to a statement from the US Embassy in Tanzania.

The MCC Board of Directors reportedly deferred a vote on the reselection of Tanzania for compact eligibility, citing the nullification of election results in Zanzibar and the Cybercrimes Act claiming that the law was used to limit freedom of expression and association.

“While the United States and Tanzania continue to share many priorities, the MCC Board of Directors determined that the Government of Tanzania has engaged in a pattern of actions inconsistent with MCC’s eligibility criteria, and voted to suspend the agency’s partnership with the Government of Tanzania,’’ a statement issued by the US Ambassador to Tanzania, Mr Mark Childress, said on Tuesday.

There was an immediate reaction from government circles in Dar es Salaam yesterday as the Minister for Finance and Planning, Dr Philip Mpango, told the ‘Daily News’ that the government was yet to receive an official statement from the MCC Board of Directors.

“I have seen the statement in the social media. As government, we are yet to receive an official statement from the board of directors, telling us why they have suspended the partnership and their conditions, then we can mull over the conditions and give them a response,” Dr Mpango noted.

Dr Mpango said the government had noted the situation since December last year; hence the MCC funding was not included in the next national budget for 2016/17 financial year, adding that the MCC II was targeting energy and mineral projects amounting to about 508 million US dollars “This is a good lesson that as a nation we must work hard and support the government in revenue collection so that we can fund our own projects,” he explained adding that Tanzanians should cultivate a culture of self-reliance,’’ he noted.

About the Zanzibar election, which was cited by the MCC board as one of the reasons for suspension of its partnership with Tanzania, Dr Mpango said, “We believe the elections in Zanzibar were free and fair and we have no issues with that.”

On Cybercrime Act, the minister said the law was enacted by the National Assembly and there are procedures to be followed if the government sees the need for amendments and not otherwise.

Dr Mpango noted that he believes in the cordial bilateral relationship between United States and Tanzania that everything will work out. Addressing a news conference in Dar es Salaam, the Minister for Foreign Affairs, East Africa, Regional and International Cooperation, Dr Augustine Mahiga, said the partnership withdrawal meant even joint ventures between the two countries would automatically crumble.

“Because the MCC’s grant was to help boost rural electrification, among other projects, which are important to the country’s development, they may gloat that they have hit us where it hurts most,’’ he observed.

He said the MCC Board should have allowed for negotiations instead of taking such an abrupt decision in Washington. “This is their decision and we cannot intervene. So when we also make our decisions, we wouldn’t want to see any interference from anybody. We have done our best in trying to straighten up things in Zanzibar and we shall continue with our commitment to democracy.

Nobody should doubt us on that,’’ he added. Renowned Economist and Senior Lecturer at the University of Dar es Salaam (UDSM), Dr Haji Semboja, said the US did not have permanent friends in poor countries and that it has been forging partnerships only when serving its interests.

“Aid from the US should not be highly depended on. In this case and for proper implementation of the country’s budget, relevant authorities should not solely count on them,” he noted.

The Dean of the UDSM Business School, Dr Ulingeta Mbamba, said it is always good for the country to create its own sources of revenue and refrain from depending on grants from donors.

Other analysts see plans for robust economic growth as laid down by the Fifth Phase Government as part of the grand solution to the imposed quagmire.

With President John Magufuli’s initiative to widen the country’s tax base to increase revenue collection, the analysts are of the view that the country will be able to run its business and development projects without depending on funds from donors who have often tagged conditions to their dish-outs.

Dr Magufuli has repeatedly expressed optimism that he aspires to see his government working hard, tirelessly and in whatever means for the nation to prosper and get away from donor dependence, citing abundant natural resources that the country has been endowed with.

The recent pronouncement by the Head of State was made last Sunday, when he joined Christians and all Tanzanians to celebrate Easter, insisting on the importance of cultivating the spirit of working hard to enable the country to rid itself of donor dependence.

However, economic pundits are of the view that the government needs to ensure macroeconomic stability to sustain the strong economic growth and set appropriate policies that would ensure benefits from sectors such as natural gas benefits all citizens and hence speedily reduce poverty rates.

Last week, a team from the International Monetary Fund (IMF) released its report that commended Tanzania’s economic growth, which grew by 7 per cent in 2015. The mission supported the broad objectives set in the published budget guidelines for 2016/17, which are based on realistic revenue projections.

The guidelines issued by the Ministry of Finance and Planning envisage a significant reduction of the overall deficit and streamlining of current expenditure to make room for public investment.