Minister in dividend wake-up call for state-owned firms

SYLIVESTER DOMASA in Dodoma

FINANCE and Planning Minister, Dr Philip Mpango yesterday issued fresh directives to all state controlled companies to increase dividends, to jack up government’s development ambition, after receiving 7bn/- from Puma Energy Tanzania. The dividend was an increase of 56 per cent from 4.5bn/- transferred last year by the same firm to the treasury.

The Minister also received 2bn/- dividend from the Tanzania International Petroleum Reserves Limited (TIPER) which was a 50 per cent profit share with Puma Energy Tanzania’s operating earnings surged by nearly 13 per cent last year, as the company benefited from its massive investment in infrastructure and asset base.

The company earned 35.5bn/- profit before tax last year - up from 31.5bn/- the previous year. Company Chairman, Dr Ben Moshi, said, “As a result, the firm will transfer 7bn/- dividend to the government.”

The government of Tanzania controls 50 per cent stake in the company, while Puma International controls the remaining 50 per cent. The Finance and Planning Minister said the government urges state-controlled firms to pay more to the government following years of investment.

“We need to help improve water supply in communities, we must ensure availability of electricity for our children to study and we have to ensure access to beds in hospital wards,” he said.

Adding, “I am pleased with the new payoff. But, this is not enough … we need to work as much as possible.” The Minister was alarmed by the fact that 28 people out of 100 in Tanzania live below the basic poverty line.

According to the Minister, the number of people living in abject poverty is more than 13 million Tanzanians. He said that the figure was too alarming and that institutions controlled by the state must support the government to improve social service access and delivery.

Dr Mpango said enough is enough for the government to rely on donors for development. He went on to assure government commitment towards supporting the companies to improve earnings and subsequently contribute to the government.

According to Puma Energy, business performance for 2016 was good both in terms of sales volume and net income. Reports from Energy and Water Utility Regulatory Authority (EWURA) reveal that the company was still a market leader with an overall market share of 13 per cent Swiss-based energy firm, Oryx Energies.