1. Art and Diseño

A Study on
Agri-Business
Opportunities Related to
Gas/Oil Activities
in Lindi and Mtwara
Commissioned by
Undertaken by
Block EC. Urafiki Flats. Ubungo
P.O. Box 33836
Dar es Salaam
Cell; +255 786 171 000/752 171 000
December 5th, 2014
TABLE OF CONTENTS
ABBREVIATIONS ...................................................................................................................................... 1
EXECUTIVE SUMMARY ............................................................................................................................ 3
1.0
INTRODUCTION ........................................................................................................................... 5
1.1
Background ............................................................................................................................. 5
1.2
Study Objectives ..................................................................................................................... 5
1.3
Limitations Faced .................................................................................................................... 6
1.4
Report Layout.......................................................................................................................... 7
2.0
LINDI MTWARA PROFILE ............................................................................................................. 8
2.1
Mtwara Regional Profile ......................................................................................................... 8
2.2
Lindi Region ........................................................................................................................... 11
2.3
Food Security in Lindi and Mtwara ....................................................................................... 14
3.0
THE GAS INDUSTRY ................................................................................................................... 15
3.1
Global Overview .................................................................................................................... 15
3.2
Gas Industry in Tanzania ....................................................................................................... 17
3.3
The Need for Inclusive Gas/Oil Industry ............................................................................... 18
4.0
INVESTMENTS IN MTWARA AND LINDI .................................................................................... 23
4.1
Projects Registered by Tanzania Investment Center ............................................................ 23
4.2
Investment in Agriculture ..................................................................................................... 24
4.3
Non-Agriculture Investments ................................................................................................ 29
4.4
The World Bank Support ....................................................................................................... 35
4.5
Promotion of Investments in Lindi and Mtwara ................................................................... 36
5.0
FOODSTUFFS DEMAND AND SUPPLY IN LINDI AND MTWARA ................................................. 39
5.1
Demand by Local Consumers ................................................................................................ 39
5.2
The Chinese Consumer Segment .......................................................................................... 41
5.3
Gas Drilling Companies ......................................................................................................... 43
5.4
Demand of Foodstuffs by Hotels and Restaurants ............................................................... 49
5.5
Specialized Fresh Vegetable Suppliers .................................................................................. 52
5.6
Grain Millers in Lindi and Mtwara ........................................................................................ 54
5.7
WABISOCO and Vegetable and Fruits Kiosk Operators ........................................................ 55
6.0
LIKELY IMPACT OF GAS INDUSTRY ON FOREST RESOURCES ..................................................... 57
6.1
Stock of Forest Resources ..................................................................................................... 57
7.0
CONCLUSIONS AND RECOMMENDATIONS ............................................................................... 62
7.1
Conclusions ........................................................................................................................... 62
7.2
Recommendations ................................................................................................................ 65
references ............................................................................................................................................. 72
Annex i: oil and gas exploration blocks and respective companies ...................................................... 73
ANNEX II : OIL AND GAS EXPLORATION COMPANIES OPERATING IN TANZANIA ................................. 74
Annex III Projected Population, number of households by income category ...................................... 76
ANNEX IV : WEEKLY FOOD PURCHASES BY LOCAL CONSUMERS IN MTWARA ..................................... 77
LIST OF TABLES
Table 2.1 : Mtwara Region Administrative Units and Population in 2012.............................................. 8
Table 2.2: List of cashew processors in Mtwara and Lindi ................................................................... 10
Table 2.3: Government Relief Food Supply to Mtwara in Mt ............................................................... 10
Table 2.4: Lindi Region: Administrative Units ....................................................................................... 11
Table 2.5: Lindi Population Size by District in 2012. ............................................................................. 11
i
Table 2.6: Number of enterprises in SIDO online database by category .............................................. 12
Table 2.7: Agricultural Production in Lindi in 2012/13 in Mt................................................................ 13
Table 2.8 : Potential Ares for Irrigation in Lindi .................................................................................... 13
Table 3.1: Long-term gas price trend in USD per MBtu(1997 – 2014).................................................. 16
Table 3.2: Four Key Strategies that Companies can Use to Expand Economic Opportunity ............... 19
Table 4.1: Projects for Lindi and Mtwara Registered by TIC (2007 - 2014) .......................................... 23
Table 4.2: Large scale crop and livestock establishments in Lindi and Mtwara (2007) ........................ 24
Table 4.3: Summary Forecast of Mtwara Port Cargo Traffic ................................................................ 30
Table 4.4: Current and future employment status of Mtwara Port ..................................................... 30
Table 5.1: Projected number of households by income category - Mtwara and Lindi Municipals ..... 40
Table 5.2: Projected market size for foodstuffs for Mtwara Municipal in TZS million ......................... 40
Table 5.3: Projected market size for foodstuffs for Lindi Municipal in TZS million. ............................. 41
Table 5.4: Consumer basket and value in TZS for of Chinese Segment ................................................ 42
Table 5.5: Projected employment around LNG Investment ................................................................. 43
Table 5.6: Estimated demand for fresh vegetable and fruits by expatriates market ........................... 48
Table 5.7: Weekly supplies of foodstuffs to VETA Hotel....................................................................... 50
Table 5.8: Sample price difference between Mtwara and Dar es Salaam ............................................ 51
Table 5.9: Major sources of food supply for Edino Investment ............................................................ 52
Table 5.10: Supplies handled by Epam per week (in Kgs)..................................................................... 52
Table 5.12: Retail Price of a Kilogram of maize flour in Mtwara Municipal in 2013 ............................ 54
Table 5.11: Foodstuffs supplied by Travis ............................................................................................. 53
Table 5.13: Quantity of Paddy Processed per week by millers in Lindi (In Metric Tonnes) ................. 55
Table 5.14: Retail price trend for rice and maize in Lindi Municipal in 2013 ....................................... 55
Table 6.1: TFS Royalty Rates on Timber ................................................................................................ 57
Table 6.2: Revenue sources for Masasi Rural District. .......................................................................... 59
Table 6.3: Estimated demand for hardwood in Lindi and Mtwara Municipals .................................... 60
Table 7.1 : Gross Profitability Estimate for Mari culture ...................................................................... 67
Table 7.2: Profitability of a 4Mt/day Starch Plant ................................................................................ 70
LIST OF FIGURES
Figure 4.1: Satellte Mapof Mahurunga Valley (Shaded) ....................................................................... 25
Figure 4.3: Vegetable production calendar at Kitere: The Case of Tomatoes ...................................... 27
Figure 4.2 : Kitere Lake: Photo and Satellite Map................................................................................. 27
Figure 4.4: Port expansion phases: short, medium and long term plans ............................................. 30
Figure 4.5: Planned Mtwara City Clusters ............................................................................................. 32
Figure 5.1: Chinese Consumer Basket by Value .................................................................................... 41
Figure 5.2: Employment pattern in gas industry .................................................................................. 44
Figure 5.3: Trend in GDP per capita for Lindi, Mtwara and National ................................................... 44
Figure 5.4: Projected employment effect in the short, medium and long-term periods ..................... 45
Figure 5.5: Profitability of vegetable business at Mtwara, Lindi and Masasi in September 2014........ 56
ii
ABBREVIATIONS
AMAGRO
Association of Mango Growers
ARI
Agriculture Research Institute
BDG
Business Development Gateway
Bln
Billion
BRELA
Business Registrations and Licensing Agency
BTu
British Thermo Unit
CSR
Corporate social responsibilities
DADPs
District Agriculture Development Plans
DC
District Commissioner
DESEMP
District Economic and Social Empowerment Programme
DFM
District Forest Manager
EAC
East African Community
EU
European Union
FAO
Food and Agriculture Organization
GCLA
Government Chemist Laboratory Agency
HR
Human Resources
ICT
Information and Communication Technology
IFC
International Finance Corporation
IFAD
International Fund for Agricultural Development
IOCS
International Oil Companies
LCP
Local Content Policy
LIMAS
Lindi and Mtwara Agribusiness Support
LNG
Liquefied Natural Gas
MACEMP
Marine & Coastal Environmental Management Project
Mln
Milllion
Mt
Metric tonne
MUVI
Muunganisho Ujasiriamali Vijijini
NBS
National Bureau of Statistics
NDC
National Development Corporation
NFRA
National Food Reserve Agency
RAS
Regional Administrative Secretary
SADC
Southern African Development Community
1
SAUT
St. Augustine’s University of Tanzania
SIDO
Small Industries Development Organization
TAKNET
Tanzania (Development) Knowledge Network
TANESCO
Tanzania Electricity Supply Company
TC
Town Council
TCCIA
Tanzania Chamber of Commerce, Industry & Agriculture
TCF
Trillion cubic feet
TCP
Trade and Competitiveness Practices
TCIMRL
Tanzania China International Mineral Resources Limited
TFS
Tanzania Forest Services company
TIC
Tanzania Investment Centre
TIRDO
Tanzania Industrial Research and Development Organization
TPA
Tanzania Ports Authority
TPDC
Tanzania Petroleum Development Company
TSCP
Tanzania Sustainable Cities Programme
UNIDO
United Nations Industrial Development Organization
VECO
Vredeseilanden Country Office
WABISOCO Chama Cha Wafanyabiashara Soko Kuu Mtwara
WB
World Bank
2
EXECUTIVE SUMMARY
Lindi and Mtwara Agri-business Support (LIMAS) is a 5-Year Programme (2011 – 2015) that supports
economic development in Lindi and Mtwara Regions in line with the National Strategy for Economic
Growth and Reduction of Poverty (NSGRP) or popularly known as MKUKUTA. It is funded through
the support of the Government of Finland and the Government of Tanzania. One of the strategic
support that LIMAS offers is to link farmers to profitable and sustainable markets and value addition.
There has emerged opportunities in the Regions involving exploration and investment in natural gas,
in this light LIMAS has commissioned a study to assess the market opportunities that have been
triggered by activities related to gas exploration, extraction, processing, transportation and
utilization.
This assessment involved collection of information from as many sources as accessible including
literature review, internet search especially on evolving industry trends, consultations had been
made with national, regional and district officials, traders, market operators, regulatory bodies and
companies that provide catering services, hotels, restaurants, etc. The analyses looked at both
qualitative and quantitative data. It has attempted to project the market for food in monetary terms.
The recommendations have been arrived at based on evidences in the field and elsewhere.
Tanzania’s economy has the potential to become a natural gas driven economy from 2020 onwards,
at the time of the study already some 46 trillion cubic feet had been confirmed by leading
International Oil Companies. Still many potential oil/gas blocks have not been conceded for
exploration. The national strategy for gas utilization require that first the gas is used to produce
electricity to meet power demand for the country, at the same time there will be investments in
renewable energy sources including hydro and wind to relieve the gas so as to develop petrochemical industries. Finally surplus gas will be compressed into liquid natural gas for export.
For Lindi and Mtwara, the gas industry activities have stimulated economic activities particularly in
Mtwara. The impact is noticeable, they include the construction of a USD 500mln cement plant by
Dangote, the construction of a gas pipeline to Dar es Salaam, construction of gas processing plants at
Madimba and Msimbati, modernization of Mtwara port, the rekindled interest in Mtwara Corridor,
influx of all important banks, etc. These are signs of a growing economy, however, there is a
yawning gap between the gas economy and local economy, it is important therefore to synchronize
and integrate the local economy into the modern gas economy. LIMAS and other programmes are
working to integrate the local economy into the gas economy by supporting enterprises that desires
to tap into the market that has resulted from the gas activities.
The market opportunity offered by the gas economy to the local economy includes:• Local consumer market segment that is estimated to be worth around TZS 20 Bln at present and
is to increase to about TZS 24bln in 2025 as population and income rises.
• The Chinese community who currently spend about TZS 1.8 bln
• Workers in drilling rigs whose current market size estimated at TZS 2.5bln per annum
• During the construction of the LNG plant demand form food may reach TZS 36.5 bln per annum.
The construction may take four years, if everything goes well the LNG plant should be launched
around 2022 – 23.
3
The middle and high income local consumers, the workers in rigs and the Chinese spend more
money on food from livestock, poultry, cattle and fish and less on staples and vegetables. Apart from
opportunities by Lindi and Mtwara urban markets, the regions can produce and market some
commodities outside the country competitively.
On overall, identified opportunities in Lindi and Mtwara are:• Beef/red meat through cattle fattening and construction of modern abattoir in Lindi Mtwara
to be able to meet international standards.
• Integrated poultry project that will harness economies of scale to be able to compete with
Dar es Salaam. As roads improve transport costs become less significant in deciding the final
prices, so has been the transport of eggs and chicken meat.
• Horticulture – Lindi and Mtwara have many basins potential for irrigation, Unlike in other
parts of the country there is lack of commercial investors in irrigated agriculture and
horticulture in particular
• Production and value addition is another potential investment in Lindi and Mtwara not only
for the population in the region but to feed other parts of the country as well as exports.
Potential fruits are pineapple and mangoes, they could be used to produce pulp.
• Fishing is an industry that is neglected in Tanzania’s Indian Ocean when demand for fish is
rising. The emerging gas population offers a lucrative market for fish, apart from sea fishing
it is possible to undertake mariculture along the sea.
• Cassava – has raised interested of many development programmes including the Agriculture
Research Institute (ARIs).
• Installing facilities to processing of pulses and sesame i.e. cleaning, hulling and splitting (for
pulses offer good investment opportunities.
_______
4
1.0 INTRODUCTION
1.1
Background
Lindi and Mtwara Agribusiness Support ‘LIMAS’ is a bilateral development project funded jointly by
the Governments of Tanzania and Finland, it aims at poverty alleviation, gender equity, sustainable
use of natural resources, adaptation and resilience to climate change and reduction of inequalities as
central cross cutting objectives. While its primary target districts are Newala (Mtwara) and Liwale
(Lindi) LIMAS also supports neighbouring Districts. LIMAS interventions are general to support the
poor and private sector to achieve the following: • Improve profitability of farming activities through functional market linkage
• Increase volume of out puts through improved yield
• Improve farmers return on investments by adding value and increasing forest productivity from
timber and other forest products
1.2
Study Objectives
The objectives of this market study are the following:•
To identify, quantify and analyze the current and future potential effective demand from the
oil/gas sector and related investment projects in Mtwara and Lindi regions for agricultural
primary produce (crops and livestock) and processed foodstuff (crops and livestock). The specific
agricultural commodities to be studied will depend on the food demand from the oil/gas sector
and its spin off investments.
•
To establish the most promising investment opportunities in terms of commodity chains with
scenarios of local supply forecasts for the two Regions and comparison with demand scenarios.
•
To assess how likely it is that the major current and planned investments in the two regions will
impact on food and forest products demand is to take off and develop in full.
•
To document current and planned major investments in the agribusiness sector itself by local
(Governments, private, smallholders) or outside investors (check national development
programmes – RAS, Ministry, etc.) and the oil/gas players themselves, i.e. in relation to their
Corporate Social Responsibility obligations laid down by government and document investment
progress and challenges met.
•
To elaborate on the current and planned efforts by the Regional authorities and business
umbrella organisations in Mtwara and Lindi to attract and support major agribusiness
investments whether from within the region, up country or even from abroad and recommend
how to enhance these efforts.
•
To profile agribusiness opportunities that would be attractive for local and other investors.
Pre-field Work: The entry activity to this assignment had been identification of key functions/actors,
secondly gathering and analyses of information and thirdly synthesis into conclusions and
recommendations. The Consultant relied primarily from the list provided by LIMAS of key actors and
5
stakeholders, a limited number of respondents were identified through referral/snowball effect. The
entire list of interviewees by October 25th 2014 is provided in Annex III.
Though limited, literature review and internet search helped the collection of information on the
status and trend of the gas industry in Tanzania and globally, key interest in literature review had
been to reinforce knowledge about the context, explore documented inclusive business models in
extractive industries and confirm some assumptions on long term prospects of the sector. The list of
documents revised is provided in Annex I
Field Work Approach: It was planned that consultations start in Dar es Salaam with high profile
respondents that included the Ministries of Energy and that of Agriculture, Tanzania Petroleum
Development Company (TPDC), National Development Corporation (NDC) and Dar es Salaam based
gas/oil companies. Up to October 10th, 2014 when the team left for Mtwara and Lindi, it had made
consultations with the following organizations:NDC on investments being promoted in Lindi and Mtwara
TIRDO on technology and quality assurance on food (product testing)
Government Chemist Laboratory Agency (GCLA) on overall food safety in the country and
procedure for accessing food testing services.
Many Dar es Salaam respondents had required a one week appointment, the team postponed the
meetings in Dar es Salaam to be continued from October 27th, 2014 so as to work in Lindi and
Mtwara first. The activities in the two regions proceeded as follows:October 13 – 19: Mtwara
October 20 – 21: Lindi
October 22 – 23: Masasi
October 24 – 28: Mtwara
October 27 – November 7th: Dar es Salaam.
Demand Side Information: This looked at population profiles, growth trends in the regional urban
areas. The study looked at; Population/Market Segments – based on consumer preferences and
purchasing pattern. To get this information a limited consumer survey was done to help
validate/update information found in the literature especially the Business Plan for WABISOCO.
Supply Side Information: Data collection on the supply side included; Production of staple food
including long-term trends; Production of fresh vegetables (horticultural products);
programmes/projects supporting agriculture production in the Regions; Market operations catering
various market segment. The list of people interviewed in provided in Annex IV.
-
Data Collection Tools: The mainly used data/information collection tool was a set of guiding
questions, however, for a sample of households a form was designed to assist the collection of
quantitative information on the type of food consumed, quantities, frequencies, etc.
1.3
Limitations Faced
The assignment faced few but important limitations as outlined below:i.
Access to International Oil Companies (IOCS) to collect information on investments and other
elements has been difficult as none accepted our request for interview. StatOil field Coordinator
6
ii.
iii.
iv.
v.
1.4
has however travelled outside the country. We assume the information gathered from TPDC and
MEM are able to provide a reasonably reliable picture.
The Regional Bureau of Statistics were expected to provide information on population growth
rates, the only rates available are for regional growths, the Managers indicated that detailed
analysis that could have provided growth rates at District level are yet to be done.
The Regional NBS offices was supposed to provide information on list of medium and large scale
farmers and industries but such information has not been compiled, actually they have just
finished listing. The Regional Offices however confirmed that apart from cashew there are
limited industrial activities in the two regions.
Mtwara and Lindi Regional Offices have not updated their regional profiles hence availability of
up to date data has been a challenge.
Since the study covered very diverse sources of information, there had been a trade-off between
details and breadth.
Report Layout
This report has 8 Chapters, Chapter 1 as may have been noted hitherto is an introduction. Chapter 2
looks at the profiles of Lindi and Mtwara to provide the context of the study area. Chapter 3 covers
the context of the Gas industry globally and in Tanzania. Chapter 4 reviews various investments
planned for Lindi and Mtwara. The assessment of demand for foodstuffs in the study regions is
provided in Chapter 5 while Chapter 6 reviews briefly the likely impact of gas economy on demand
for hardwood timber. Lastly Chapter 7 summarizes findings and provides recommendations.
7
2.0 LINDI AND MTWARA PROFILES
2.1
Mtwara Regional Profile
2.1.1 Geography
Mtwara Region lies between longitudes 38 and 40 East of Greenwich and between 10 and 11
latitudes South of the Equator. River Ruvuma forms the Southern Border with Mozambique, on the
West side is Tunduru District (Ruvuma Region) and Lindi on the North. It has an area of 16,720km2 of
which 85% is suitable for agriculture, human settlements and livestock keeping. Soils are of coastal
sedimentary in nature that is well drained, sandy with low moisture holding capacity. This type of
soils stretches about 120kms towards Makonde Plateau in Newala. Better soils are found in the
North of Masasi town.
There are four Agro-ecological zones described below :
Zone I: Covers South half of Mtwara DC and South East of Newala. Annual rainfall exceeding
1000mm with relatively longer wet period (6 months); this low altitude area has less fertile soils.
Zone II: North half of Mtwara DC, it receives between 600 and 1000mm of rainfall from November to
April. Soils have low fertility and medium moisture holding capacity.
Zone III: whole of Masasi, North and West part of Newala. Rainfall in this zone ranges from 600 to
1000mm; between December and April. Soils are low in fertility.
Zone IV: South East of Mtwara Rural: the zone has longer growing period November to May and
experiences rainfall above 600mm. Soils are alluvial with high fertility rates.
2.1.2 Administration and Population Trends
Mtwara is divided into the Districts of
Mtwara Municipal, Mtwara DC, Masasi,
Nanyumbu, Nachingwea, Tandanhimba
and Newala. The 7 districts are
subdivided into 27 divisions, at the time
of 2012 Population Census there were
149 Wards and 694 villages. In 2002 the
Region had a population of 1,124,481.
The projection then suggested that by
2012 there will be 1,374,767 people, the
Census count revealed a population of
1,270,854 a variation of 8%. The mean
annual growth rate between 2002 and
2012 was 1.2% down from 1.7% between
1988 and 2002.
Table 2.1 : Mtwara Region Administrative Units and
Population in 2012
District
Divisions
Wards
Villages
Population
(2012)
2
15
6
108,299
Mtwara
Newala
6
5
28
28
157
155
228,003
205,493
Tandahimba
3
30
157
227,514
Masasi DC
5
22
130
260,854
Masasi TC
2
12
0
89,835
Mtwara
Mikindani
-
Nanyumbu
4
14
89
150,857
Total
27
149
694
1,270,854
Source: Mtwara Regional Profile
8
Projection using the established growth rate of 1.2% per annum lends to a population of 1,431,861
by 2022 (10 years after the 2012 Census), and 1,466,432 in 2014 (10 years from now). One source
indicated that the population of Mtwara Municipal is growing at 4.1%. Data from past years showed
that more people have been leaving Mtwara than those getting in which has reduced the regional
population growth since the Regions have comparable birth rates. The young population and the
educated emigrate to larger towns especially Dar es Salaam. There is a strong feeling that
“immigration” from other regions of Tanzania and to some extent from other countries into Mtwara
will contribute to population growth that is larger than 1.2%. Some factors that will contribute
include:•
Industrialization of Mtwara that require skilled labour will pull labour from other regions as
currently the general perception is that there are few people with requisite skills in Lindi and
Mtwara. One youth who operates a bodaboda when asked why he doesn’t seek and work in the
fields that require skills he reckoned that
“Construction companies and individuals who build houses here bring fundis and sometime even casual
labourers from other regions, they don’t like us.”
•
Limited employment and business opportunities in other regions will encourage youths and
businesses to look into new areas with promising future.
•
Ease of access in and out of Mtwara and Lindi due to improvement of road networks and in
future the rail line between Mtwara and Malawi border.
2.1.3 Industries
Data on industrial base in Mtwara and Lindi is very scanty. A data base of businesses with Mtwara
Municipal Trade Officer (MTO) shows that there are 9 milling machineries, 4 bakeries, 1 salt
processing. NBS is currently conducting a survey to count the industries. The 2009 Industrial
Production Survey identified 9 establishments that employed 10 or more people, these were
Manufacture of beverage (ISIC 110) – 2 firms, Other textiles, garments and apparels (ISIC 139) - 1,
Printing services -2 units, manufacture of furniture (ISIC 310) – 1 firm. The firms employed 317
people. Lately the Region is witnessing the high growth in industrial capacity as cement factories are
under construction.
The cashew crop accounts significant Regional GDP and it has been cited to offer competitive
return on labour compared with some urban – based unskilled manual works causing shortage
labour in urban areas. In the 1970s with the support of World Bank the country built several
factories to add value to cashew. Unfortunately many closed business towards the end of 1980s
and early 1990s. In 2000s there have been interests to invest in cashew processing by both the
Government and Private Sector. According to Cashew nut Board of Tanzania Mtwara has installed
processing capacity in excess 68,000Mt per annum. However, processors whose combined capacity
is 28,900Mt (about 40%) have been reported as operating, the remaining 60% capacity is nonoperating. The list of processors in Mtwara is provided in Table 2.2.
9
Table 2.2: List of cashew processors in Mtwara and Lindi
Processor
Location
BUCO
Masasi
10,000 Does not operate
Newala I
10,000 Operating
Mtwara
10,000 Operating
Micronix
Likombe-Mtwara
10,000 Does not operate
Micronix
Newala II
10,000 Does not operate
River Valley
Tandahimba
10,000 Does not operate
OLAM
Sanol Factory Mikindani
2,000 Operating
CC 2005 LTD
Mtwara MCC
2,000 Operating
Masasi Farmers Group
Masasi
2,000 Operating
MAFC
ARI Naliendele
300 Operating
Kitama Farmers Group
Kitama
300 Under trial operation
OLAM
Annar Factory Newala
Perfect Kernels
Masasi
Agrofocus
OLAM
1
Capacity Status
2,000 Operating
300 Operating
Total
68,900
Source: Tanzania cashew Nut Board
A market study by NIRAS (2012) showed that domestic demand for roasted cashew is very limited,
one expert estimated the demand to be around 200Mt per annum citing high consumer price as a
limiting factor. Hence the installed throughput capacity in Mtwara of 68,900Mt using a raw to kernel
conversion ratio of 5:1 the capacity would be translated to 13,780Mt of kernel making export a
necessary target market.
2.1.4
Agriculture
Regional statistics show that during
2013/14 season, the region produced
718,000mt of staple foods that principally
comprised of cassava (70% of sample food
by volume), maize, sorghum and paddy
from 462,156hectares cultivated in the
region. According to adopted food security
indicator the region requires 460,644Mt of
foods, of which 332,184Mt are main
source of calories and 128,460Mt of
legumes that are main source of protein.
Table 2.3: Government Relief Food Supply to
Mtwara in Mt
District
2008/2009 2009/2010 2011/2012
Masasi
Mtwara
Nanyumbu
491.30
TOTAL
491.3
Source: NFRA, 2013
3,140.60
737.00
1,010.00
4,887.6
353.20
353.2
1
At the time of the study it was not clear whether OLAM has closed his largest factory in Mtwara or not, informal sources
confirmed the closure while the Cashew Board and some Government officials reported to have been not aware. Again
informally it has been reported that Export Trading Group (ETG) has opened up a processing plant in Mtwara that will
provide employment to about 300 people.
10
Traditionally Mtwara and Lindi are not self-sufficient in terms of food supply and have at times
received relief food from the National Food Reserve Agency (NFRA). The region has been identified
to have many potential areas for irrigation especially along major rivers including Ruvuma River
Valleys including Mahurunga and Kitere Plains. Mtwara DC is supporting irrigation projects at 8 sites
covering 2,872 hectares under the Agriculture Sector Development Programme/Participatory District
Irrigation Plans Development Plans (ASDP/PIDP). Masasi has a potential of 12,000 hectares that
could be irrigated but only 4,460 is under use. Apart from Ruvuma River other potential irrigation
areas are valleys of Mwiti, Mbwinji, Mkungu, Ndanda and Mkululu rivers. Despite the potential,
there is lack of serious private sector investors in irrigated agriculture something that call for a
review of the investment promotion strategy.
2.2
Lindi Region
2.2.1 Geography and Administration
The Regions of Lindi, Mtwara and Ruvuma make Southern Zone of Tanzania, Lindi lies between 70
55” and 100 South of the Equator, between longitudes 360 51 and 400 East. The region has 4 agroecological zones: Coastal Low Land: Rises from 0 to about 120m above sea level, it has sandy loamy,
and clay soils with sedimentary rock. Staple food crops in this zone are cassava, sorghum, and sweet
potatoes and coconut, cashew nut, simsim and pulses are for cash. Medium costal Lowland: Elevates
at 120 – 750m above sea level, soils are sand loamy. Food crops in this area are sorghum, maize, and
paddy while cash crops are coconut,
cashew nut, simsim, pulses and fruits. Table 2.5: Lindi Region: Administrative Units
Central Plain: is between 750 and 850m
Area Divisions Wards Villages
above sea level. Soils are of basement
Kilwa
13,347
6
21
96
rocks and fertile silt. Staple food crops are
Lindi DC
7,538
10
30
134
Ruangwa
2,580
3
21
89
maize, sorghum, and cassava, cash crops
Nachingwea
7,070
5
32
126
are cashew nut, groundnuts and fruit.
Liwale
36,170
3
20
76
Upland: Is at altitude 850 – 915m above
Lindi
MC
945
1
14
20
sea level, it has fertile loamy soil and
Total
67,650
28
138
541
sedimentary rocks.
The same crops
Source: Investment Opportunities Existing in Lindi
cultivated in central plain are found
upland.
Table 2.4: Lindi Population Size by District in 2012.
Administratively, Lindi is divided into 6
Districts, 28 Divisions, 142 Wards and 541
villages 2.
Refer Table 2.5 for more
information. According to the 2012
Population and Housing Census, in 2002 the
Region had a population of 787,624 people;
they increased to 864,652 by 2012 growing at
an annual rate of 0.9%.
Population
Kilwa
190,744
Household
Size
4.4
No. of
Households
43,351
Lindi DC
194,143
3.7
52,471
Nachingwea
Liwale
178,464
91,380
3.7
4.3
48,234
21,251
Ruangwa
131,080
3.5
37,451
Lindi MC
Total
78,841
864,652
3.5
23
22,526
225,284
Source: 2012 Population and Housing Census
2
Lindi RAS Office. January 2014. Investment Opportunities Existing in Lindi Region.
11
The population growth rate for the region has declined from a mean annual rate of 1.4% between
1988 and 2002 to 0.9% between 2002 and 2012 leading to a population of 864,652 people. One
important observation about the population growth in Lindi is that using the 2002 results the
population was projected to reach 960,236 in 2012, the Census results of 864,652 people makes a
variation of about -10%. While the Census Report does not explain the reason for variations it may
have been due to unanticipated emigration to other towns especially Dar es Salaam or a drop in
fertility rate. Common people in the street also allege that the negative message from some sections
of the society that called its members to boycott the counting may also contributed to the reported
low growth and deviation.
2.2.2 Manufacturing Industries
Lindi is grossly starved of manufacturing industries, according to a 2009 Annual Survey of Industrial
Production for establishments employing 10 and above people, the Region had 1 Sawmill (ISIC 161),
1 Manufacturer of Other Chemical Products (ISIC 202) and 1 Furniture Manufacturer. Interview with
various stakeholders confirmed the lack of industrial activities in the Region. There had been
investments in some commodities that failed to reach the marketing stage, they include:• Cassava processing – it is not clear if it operated but closed due to, according to the source,
unreliable and expensive power supply.
• Cement factory whose construction stopped for different reasons, some mention lack of funds,
others lack of electricity to power the plant and others state weak technical capacity of the
constructing company while TPDC says the construction is on schedule.
• Sesame oil press at SIDO Industrial Estate has been shifted to Coast Region to diversify oilseeds
base to include sunflower instead just sesame which is common in Lindi and Mtwara but faces
stiff competition from export market for raw sesame.
The 2011 Regional Profile mentions metal works, wood works, grain milling, sawmill, garages,
tailoring marts, poultry as the main industrial activities in the Region 3.
The SIDO online database 4 of SMEs confirms the
limited number of agri-businesses in the two
regions, opportunities listed are fishing, forest
products, gypsum; Agricultural Products principally
cashewnuts, sisal, sesame, oranges, coconuts, soya,
beans, maize, cassava, paddy, groundnuts,
sorghum. There is manufacturing of woodwork
items including manufacturing of rope and twine,
leather products, and cashew nut processing. Other
areas include sea salt extraction, weaving coconut
coir items and processing of cassava products.
Mtwara on its part lists salt extraction, processing
Table 2.6: Number of enterprises in SIDO
online database by category
Activity
Lindi Mtwara
Blacksmiths
18
0
Engineering
7
0
(fabrication/metalbased workshops, etc)
Textile
7
4
Food processing
7
2
Handicraft
6
4
Total
45
10
Source: www.sido.go.tz/reports/
33
At the time of writing this report, the Consultant had not confirmed information that there is a cement
factory at Kilwa.
4
http://www.sido.go.tz/Reports/WEB_RPT004.aspx?Region=Lindi
12
and packaging, processing of cassava into various end products, cashew nut processing, sunflower
oil expelling and groundnut oil. The database above is relatively old, the Regional Offices have
submitted an updated list of SMEs to SIDO HQs for official publication.
2.2.3 Agriculture
The major food crops grown in the region are cassava, maize, beans, paddy and sorghum. Table 2.7
below shows the composition agricultural crops produced in Lindi. The trend of production shows
that there has been a rise and fall in the production; the 2006/07 was the best year in the
production of major food crops as shown in the table below. Furthermore, the table shows that
most of the Lindi agricultural households produce more cassava followed by maize and paddy as
major food crops. The Region outlines crops that are suitable for production in the region.
Table 2.7: Agricultural Production in Lindi in 2012/13 in Mt.
Kilwa
Lindi (R )
Lindi (M)
Liwale
Nachingwea
Ruanngwa
Total
FOOD CROPS
Cassava
19,560
19,966
29,524
1,048
30,141
31,204
131,442
Sorghum
2,894
8,729
3,754
2,865
22,529
9,372
50,143
Maize
11,105
18,210
2,613
3,710
42,527
27,212
105,377
Paddy
1,774
7,263
382
304
6,032
9,573
25,328
447
0
0
175
6,030
0
6,652
35,780
54,168
36,273
8,102
107,259
77,361
318,942
2,295
13,088
5,929
12,031
6,331
39,674
Sweet Potato
Sub-Total
Pigeon Peas
Cow peas
1,925
10,574
7,412
874
8,563
6,000
35,348
Total
4,220
23,662
13,341
874
20,594
12,331
75,021
Cashew
10,491
1,579
0
0
0
16,404
28,474
Sesame
10,378
2,979
1951
0
8,120
14,344
37,772
109
537
1220
0
3,206
-
5452
2,625
-
CASH CROPS
Groundnuts
Coconut
5072
2373
0
0
16
0
0
46
4,076
4137.75
Onions
8
0
48
40
15,425
15,521
Tomatoes
6
0
166
40
20,156
20,368
5544
214
11,452
70,405
121,795
Sunflower
Total
26,460
7,720
Source: RAS – Lindi
Lindi is estimated to have more than 24,000
ha that are potential for irrigation, of these
only 3,661 ha or 15% is under irrigation as
Table 2.8 suggests.
10450
Table 2.8 : Potential Ares for Irrigation in Lindi
District/
Council
Kilwa
Lindi
Ruangwa
Nachingwea
Liwale
Lindi (M)
Total
Potential
Area (Ha.)
4,332
10,000
7,160.1
200
1880
866
24,438.1
Irrigated
area (Ha)
80
1416
1200
50
100
815
3,661
Percent
1.85
14.16
16.76
25.00
5.32
94.11
14.98
Source: RAS – Lindi
13
2.3
Food Security in Lindi and Mtwara
Major source of calories (staple) food for Lindi and Mtwara are cassava, sorghum, maize and rice.
The established index for food security in Tanzania is a per capita daily intake of 650grams of
carbohydrates and 65grams of protein/legumes per day. Lindi is more prone to food insecurity partly
because a large part of the Region receives less rainfall that is also erratic (few number of
precipitation days in a month). Data from NFRA indicate that Liwale had received relief food
continuously between 2007/08 and 2011/12, albeit small, the relief food shows persistent food
insecurity. The food deficit in the region has been confirmed by millers who indicated that significant
amount of cereals come from other regions. Food deficit can be further evidenced with higher food
prices than most parts of the country and indeed higher than the national average price for most
part of the year.
Lately there has been improvement in supply of food within the Region, the report from NFRA 5
shows that for 2012/13 Lindi had a self-sufficiency ratio in staple food supply of 129% while Mtwara
had 139%. The figures from NFRA however, reveal that some 61 districts had signs of food shortages
in 16 regions including Lindi and Mtwara. In Lindi almost all the districts had pockets of vulnerable
areas, arranged by decreasing degree of vulnerability the Districts are Kilwa, Lindi Urban, Lindi Rural,
Liwale, Nachingwea and Ruangwa. Mtwara fares better first it has more surplus at 39% and fewer
Districts with vulnerable pockets as it is only Masasi and Mtwara Rural that had signs of food
shortage for 2013/14.
The phenomenon that a region has surplus but experiences food shortages signals the limitations of
market forces in ensuring access to food. Reasons for limitations include inadequate capacity to
stock the produce, poor infrastructure connectivity between surplus and deficit areas as well as bias
against certain types of foodstuffs in this case against cassava.
5
AGSTATS for Food Security. VOLUME 1: The 2012/13: Preliminary Food Crop Production Forecast for 2013/14
Food Security.
14
3.0 THE GAS INDUSTRY
3.1
Global Overview
It is projected that the global demand for liquid hydrocarbons will continue to grow annually by 1.2%
on average 6 and will reach 105mb/d by 2025. Much of this growth is attributed to transportation
sector which rely on liquid hydrocarbons for over 90% of its needs. Globally there is expansion of
transport infrastructure and more ambitious plans and projects are found in almost all developing
countries as it has been concluded that efficient transportation system is a pre-cursor to accelerated
economic growths. Correspondingly, economic growths witnessed in most parts of the World and
particularly in the populous Asia and to some extent Latin American and recently Africa have led to
increased demand for transport operating equipments (motor vehicles, railway, airplanes, etc.)
In the past, gas had been treated as a by-product of oil production process and less as a primary
product, however, in recent decades there has been increase in interest, demand, exploitation and
use of natural gas as production costs hence price of close substitute (liquid hydrocarbons)
increased. It has been found out that natural gas has a number of advantages over other fossil fuels
that includes:•
Due to higher carbon emission, the burning of coal and oil has been singled out as the major
source of green house gases that deplete the ozone layer and cause global warming, the fuels do
have higher levels of dangerous elements of sulphur and nitrogen.
•
There is growing demand for electricity generation in fast industrializing countries of China, India
and other Far East countries. Africa is also growing and electric power supply has always lagged
the demand.
•
There is growth in population coupled with high urbanization rate, projections are that by 2050
about 50% of the World’s population will live in urban areas hence putting pressure on
household needs for energy, gas is among the best options accessible.
•
There are efforts to use gas to fuel public transport vehicles in different parts of the World, it is
yet insignificant but a promising technology.
•
Nuclear energy, an important alternative to gas in power generation is on the drawing board
again in many European countries, there is a debate about its safety following a series of
accidents including the Three Mile Island in US in 1979, Chernobyl in Russia in 1986 and
Fukushima Daiichi Japan in 2011.
LUKOIL publication views the future of gas industry positively and points out that
Until 2025 global gas consumption will continue to grow at an annual rate of 2.2%. Therefore gas
consumption will have the highest rate of growth among other types of fossil fuels.
6
LUKOIL, Global Trends in Oil and Gas Markets to 2025
15
The report adds that
“by 2020 China will become one of the world’s largest consumers and importers of gas”.
Share of Natural Gas in Indian Energy basket is projected to increase from 11% to 20% by 2025. In
response to this opportunity, US is investing heavily in Shale Gas and is becoming an important
exporter. Australia is also poised to become among the world’s largest supplier of LNG in the global
markets.
Table 3.1: Long-term gas price trend in USD per MBtu(1997 – 2014)
Source: USA Energy Information Administration
In its well-researched study, the Massachusetts
Institute of Technology Energy Initiative (MIT Rei)
noted that between 1965 and 2009 the market share
of gas in the energy portfolio has increased from 15%
to 24%, but considering the growth in energy sector
the absolute increase over the period has been fourfold. Projecting the future, the report adds that
Gas price is quoted as USD per Million
British Thermal Units (BTU) energy
equivalent. However, some reports uses
USD per Million Cubic Feet (MCF).
Unlike other fossil fuels, natural gas plays a major role in most sectors of the modern economy — power
generation, industrial, commercial, and residential. It is clean and flexible. The role of natural gas in the
world is likely to continue to expand under almost all circumstances, as a result of its availability, its
utility, and its comparatively low cost.
MIT Study on the Future of Natural Gas. Executive Summary Page 2.
The current unprecedented fall in prices of petrol from US105 in June 2014 to less than USD 60 in
January 2015 implies the investors have to figure out their business models to accommodate such
changes. The gas price is usually influenced by five factors; usage predictions, demand forecasts,
current inventory levels, speculation and the weather. Some OPEC officials recently stated that the
ongoing fall is beyond fundamentals leaving behind some critical questions, how far will the
downward trend continue, where will the price settle and how long movements take. Summing the
ongoing debate as how what caused the price fall Business Insider points out that
“No one is sure exactly why the price slid so rapidly, but it's now down to around $60 per barrel
and doesn't show any signs of recovering” 7.
7
Read more: http://www.businessinsider.com/opec-now-believes-in-letting-the-market-take-care-of-oilprices-2014-12#ixzz3PJzvEDoI
16
Many though are of the opinion that price fall in petrol in the World market is not permanent as it is
not backed by fundamentals.
Tanzania’s strategy that gas should first power the country, then migrate into export will help
cushion the impact of global price shocks, after the domestic has been well served, the gas is
planned to feed petro-chemical industries and other energy-intensive economic activities. Finally
excess gas will be exported most likely to Asia. This may coincide with the timing of the envisaged
LNG plant that may come on stream around 2022 – 2023 ceteris paribus. In their presentation 8 Gulf
Research Centre mentions the following as potential manufacturing activities that can directly use
cheaper raw materials from natural gas; i.e. ammonium fertilizers, pharmaceuticals, adhesives,
paints, fleece, automotive, recyclable plastic bottles, silicones. Cheap energy source generated from
gas can support industries related to: iron/steel, glass, ceramics, bricks and blocks, cement, food and
beverages, metal working, rubber and plastic products, paper, textile and nonferrous metal.
3.2
Gas Industry in Tanzania
Knowledge about gas reserves in the Tanzania - Mozambique Channel dates back to 1950s when
preliminary data showed presence of significant amount of gas and oil reserves. In 1970s more
seismic surveys were conducted resulting into discovery of commercial volume at Songosongo in
l974. The discovery was confirmed by TPDC in 1975-79, later exploration discovered gas fields at
Mnazi Bay in 1982.
As global economic development especially in China and India put pressure on demand for energy, it
rekindled interests of various international gas/oil companies to drill gas wells in areas with higher
possibilities in Mandawa Basin and Kimbiji/Ruvu areas. TPDC acquired more 2D high resolution
seismic data from deepwater areas offshore Tanzania that allowed it to license blocks to Petrobras,
Ophir, Statoil, BG and Dominion by 2012. According to TPDC by 2012, significant gas discoveries had
been made at 4 blocks. By 2012 some 35 explorations and development wells had been drilled and
seismic coverage of 52,000 km both offshore and onshore were made. Discoveries made by 2013
amounted to 46.6 trillion cubic feet (TCF) of which 8 TCF was onshore and the remaining 38.6TCF
was offshore. See List of Gas/Oil Companies operating in Tanzania in Annex I).
On- and off- shore of the two regions of Lindi and Mtwara abound with gas reserves (and perhaps
oil) that have attracted investments and other developments in the regions especially infrastructure
and heavy industries like the cement. On shore and offshore oil and gas exploration and production
activities are bound to increase as a number of blocks are yet to be licensed, exploratory drilling is
being undertaken and in some areas production of gas is under design. The gas (at present) has a
strong pulling effect to other energy intensive business activities including power generation,
cement production, petro-chemicals, etc. Activities being implemented in the gas sector during
2013/14 include 9:-
8
9
In Dar es Salaam on July 13 – 14, 2010
Ministry of Energy and Minerals
17
•
•
•
Installation of the gas pipelines from Madimba in Mtwara and Songosongo in Mtwara to Dar es
Salaam and had reached an advanced stage.
A gas purification plant is being constructed at Madimba in Mtwara, it involves construction of
staff houses and a foundation for the plant. Another purification plant will be constructed at
Somanga in Lindi. The plants are being constructed by a Chinese firm and were planned to be
completed by December 2014 at a cost of USD 1.2 billion 10.
The Ministry has commissioned studies on local uses of natural gas including for households,
transport, industrial, institutions and power generation in adjoining towns of Kilwa, Mtwara,
Lindi and Kisarawe.
The most important investment, however, will be the construction of a Liquefied Natural Gas (LNG)
plant planned to be constructed at Mitwelo in Lindi. To make LNG, natural gas has to be condensed
at below -1620c which results into a reduction in volume by 1/600 (i.e. to 0.167%) of its original size.
LNG is economical to store and transport over longer distances usually by huge specialized tankers.
This is a joint undertaking involving TPDC, BG, ExxonMobil, Ophir and Pavilion Energy. This is a
technically complex and huge investment hence it has a long-term outlook. Partners are still working
on technical options including linking the different gas wells undersea and business models.
Optimistically it can take 10 years for the plant to complete and pessimistically 15 years. The LNG
plant once completed will have a number of embedded industrial and services around it.
In anticipation of on-coming investments in Lindi, an investor from Middle East 11 commissioned
construction of a cement factory. However, the construction has been stalled, it is not clear why,
some attribute the stoppage to underfunding, others say due to lack of synchronization between the
construction and power supply in Lindi is the cause, that, if the plant was to be completed while
there is no electricity to power the plant to be operational, hence it will tie up capital while waiting
for sufficient power supply. However, TPDC official said the construction is according to plan.
At the time of undertaking this study, Lindi faced serious power outages (perhaps the worst in the
country at the time) 12, TANESCO has planned a 132KV line from Mtwara to solve the problem and it
is anticipated that the construction will be completed by December 2015.
3.3
The Need for Inclusive Gas/Oil Industry
3.3.1 Literature Review
Literature indicate that without proper social inclusion policies, strategies and regulatory
frameworks and strong corporate social responsibilities (CSR), extractive industry can have limited
impact to the local economy and indeed the communities in which the extraction takes place.
Geographical isolation, political exclusion and market failures are some factors that
alienate/constrain the poor to participate and benefit from such endowments.
10
Ministry of Energy and Minerals. 2014/15 Budget Speech.
M/S MEIS
12
Two weeks later there was a public protest against TANESCO on electricity woes in Lindi.
11
18
Table 3.2: Four Key Strategies that Companies can Use to Expand Economic Opportunity
Objective
Strategic Approach
Creating inclusive business Involving the poor as employees, entrepreneurs, suppliers,
models
distributors, retailers, customers, and sources of innovation in
financially viable ways.
Developing human capital
Improving the health, education, experience, and skills of employees,
business partners, and members of the community.
Building
institutional Strengthening the industry associations, market intermediaries,
capacity
universities, governments, civil society organizations, and grassroots
groups who must all be able to play their roles effectively within the
system
Helping to optimize the Shaping the regulatory and policy frameworks and business norms that
“Rules of the Game”
help determine how well the economic opportunity system works and
the extent to which it is inclusive to the poor.
Source: Wise, Holly and Sokol Shtylla (2007) 13
An online discussion forum, the Tanzania (Development) Knowledge Network
(TAKNET)
acknowledges issues around which some countries have managed to develop their gas industry
under the principle of equitable distribution of gains. The forum, and this was also supported by
some World Bank officials identified Norway, Ghana and Trinidad and Tobago as some model
countries.
3.3.2 Tanzania Natural Gas Policy
The extraction of gas in Tanzania is not new, Artumas has been extracting gas from Songosongo
Island since 2006, the gas has been piped to Dar es Salaam where is used to produce electricity at
Ubungo Power Station to feed the national grid, some piped to industries and institutions. The gas
from Mnazi Bay is transported to Mtwara to power a 12MW plant 14. The prominence in social,
economic and political scene of gas in recent years has been triggered by influx of International Oil
Companies (IOCs) and the Government commitment to build a large pipe to transport gas to Dar es
Salaam which has been politicized. To guide the industry, the Ministry has developed a policy on gas,
“The Natural Gas Policy of Tanzania of 2013”, the Policy looks at eleven broad issues outlined
hereunder:i.
Optimizing investment for natural gas infrastructure (for processing, liquefaction, transportation,
storage and distribution} to serve the domestic, regional and international markets.
ii. Efficient an effective supply of natural gas for local markets and maximizing gains from export of
LNG to international markets. LNG is the single largest investment planned in the gas economy.
It is estimated at USD 10 Billion.
13
Wise, Holly and Sokol Shytlla. 2007. The Role of the Extractive Sector in Expanding Economic Opportunity.
Harvard University.
1414
The capacity utilization is around 67% due to limited demand in the Lindi –Mtwara corridor.
19
iii. Managing revenue arising from natural gas with a view to benefit the present and future
generations of Tanzanians. There are discussions on the design of sovereign wealth fund for
Tanzania going on drawing lessons from various countries in the World.
iv. Instituting appropriate pricing mechanism to sustain the supply and demand of natural gas
v. Ensuring there is security of infrastructure of natural gas in the domestic market as the product
is highly flammable.
vi. Mainstreaming natural gas resource utilization in other strategic socio-economic sectors
vii. Empowering Tanzanians to benefit from natural gas industry through enhanced local content
agreements.
viii. Emphasizing the need for players in the industry to have robust corporate social responsibilities
policies and programmes
ix. Ensuring that the natural gas is exploited and used rather sustainably through promotion of
rational use. A Gas Utilization Master Plan is being developed to guide rational use of gas.
x. Enhancing regional and international cooperation in order to seize opportunities that are
brought about by these associations, they include strategically, EAC and SADC.
xi. Improving public awareness on matters pertaining to the natural gas industry, one area to be
addressed is over-expectations first on likely benefits, timing of results and investment
requirements. The Ministry through its Communication Section develops and disseminates
various awareness raising materials including printed matter, radio and TV programmes.
Other instruments for managing the natural gas industry are:•
The Local Content Policy currently being drafted and planned to be completed in 2015, it is
providing guidance on how the industries should link to the local economy and sets performance
benchmarks,
•
The Gas Strategy that was planned to be completed within 2014 but may take place in 2015,
•
A Gas Utilization Master Plan for Tanzania which is planned to be completed in 2015, it will set
out priorities in the short, medium and long-terms.
3.3.3 Local Content Policy: Inclusion of the Local Economy
The need to map is to ensure that the country and communities in the gas/oil production area are
given due consideration in the design of investments, a Local Content Policy of Tanzania for Oil and
Gas Industry is underway 15. The Tanzania Natural Gas Policy of 2003 states that
“Natural gas resource found in Tanzania belongs to Tanzanians; and must be managed in a way
that benefits the entire Tanzanian Society” 16.
It provides premise for the Local Content Policy that emphasizes on activities that target to develop
the Tanzanian workforce through employment and training and investment in supplier development
through developing and procuring supplies and services locally. Among broad aims of the Local
15
16
The Draft is available online and is still a work in progress, stakeholders have been invited to comment.
Cited in Local Content Policy of Tanzania for Oil and Gas Industry 2014 (Draft).
20
Content Policy (LCP) is “setting a mechanism that will enable Tanzanians and their businesses to tap
into opportunities to manage, supply goods, services and labour.
The Policy has been developed based on policies elsewhere globally that set minimum local content
benchmarks in the supply arrangements. The objective of this Policy move is to enhance value
addition and job creation through use of local firms to provide goods and services. Policy statements
related to this objective are to ensure:i.
A compulsory Local Content requirement in every Invitation to Bid;
ii. That contractors and lead subcontractors manage risks of local businesses to allow their
participation; and
iii. Transparency, value for money and competitiveness in every procurement process undertaken
by contractors and sub-contractors.
3.3.4 The Gas Utilization Master Plan
The framework for gas utilization is set in the Policy document that want to ensure that before the
country decide to export, it has to be sure that domestic demand for gas are met. To operationalise
this vision, the country is preparing a Gas Utilization Master Plan. The first Draft was completed in
2012, it was later reviewed in 2013, and the Master Plan is under updating by a Consultant and will
likely be completed by early 2015. The Master Plan has to adhere to Policy priorities as outlined
below.
Figure 3.1: Main stages in
First and foremost the country will build the capacity to use exploitation of Natural Gas
the gas to generate electricity that will increase the national
installed power generation capacity from the current 1.4-1.5
GW to 10GW by 2025. The capacity utilized now is about
1.0GW. In the medium term the strategy will be to develop
renewable energy sources including hydro power plants, coal
and wind energy sources 17. The replaced natural gas will
offer a feedstock to an array of industrial products.
The use of gas in factories and institutions is expanding
especially in Dar es Salaam, already some 37 factories have
been connected to natural gas supply lines. Also 4 large
hotels, 70 households, 40 vehicles have been fitted to use
natural gas, there are also some prisons and army barracks
that are connected to the natural gas. Use of gas in vehicles
could cut costs by about 30%, however this requires that
there in place an appropriate tax regime especially during
investment in infrastructure, There was a programme to
expand conversions of petrol motor vehicles to gas targeting
to have reached 8,000 vehicles by 2015. The Programme was
stalled for lack of funds to expand the gas outlets network,
17
Stage
Activity
1 >
Arial mapping
2 >
Gravity mapping
3 >
Seismic mapping
4 >
2D Mapping
5 >
3D Mapping
6 >
Analysis/decision making
7 >
Drilling/Rigging
8 >
Appraisal
9 >
Declaration
10 >
Business Plan
11 >
Negotiation
12 >
Contracts
13 >
Investment
In very long-term, Tanzania is bracing to go nuclear due to the fact that the fuel (uranium) is available in Tanzania.
21
the Ubungo Natural Gas Plant is the only functioning refilling point at present.
In the long run (10 – 15 years) it is expected that there will be increased national capacity to produce
gas, leveled power demand from natural gas and excess volume of gas ascertained, the excess gas
has to be exported in form of Liquid Natural Gas (LNG). This long-term but important endeavour is
still at a pre-feasibility study level under the partnership of TPDC, ExxonMobil, BG, Ophir and Statoil.
The cost of an LNG plant is very high at a rough estimate of USD 10billion 18. The current plan is to
link the gas blocks 1, 3 and 4 owned by BG, Exxon Mobil and Pavillion and Block 2 owned by StatOil
to the potential on shore point where LNG plant will be constructed.
18
TPDC is of the opinion that the cost of LNG plant will be known after a business plan is completed but may
be in the same range.
22
4.0 INVESTMENTS IN MTWARA AND LINDI
4.1
Projects Registered by Tanzania Investment Center
Tanzania Investment Centre (TIC) is mandated to promote and support investment inflow into
Tanzania, it operates as a one-stop shop for investors supporting them with issues related to
company registration (BRELA), work permits for foreigners, immigration procedures, Tanzania
Revenue Authority on advice related to tax compliance and a desk that addresses issues related to
land. Unfortunately the role of TIC beyond formalization paperwork is limited, they can’t tell the
status of the projects they have registered as to whether the investment has been done and the
numbers of employment and investment stated in the business plans have been realised or not.
Between 2007 and October 2014 some 85 projects destined for Lindi and Mtwara have been
registered with planned total investment valued at USD 2.128 billion and an estimated employment
potential of 27,792 jobs. Mtwara accounted for 67% of the number of projects, 55% of the potential
employees and 75% of the investment value, see Table 4.1 below for more information.
Table 4.1: Projects for Lindi and Mtwara Registered by TIC (2007 - 2014)
Sector
Mtwara
Lindi
Total
Potential
Value of
No. of
Potential
Value of
No. of
Potential
Value of
Employment Investment Projects Employment Investment Projects Employment Investment
in USD
in USD
in mill USD
15
9,959
1,485.61
9
653
95.76
24
10,612
1,581
1
367.01
1
367
18
791
40.68
13
646
20.37
31
1,437
61
7
3,172
19.87
4
10,990
38.31
11
14,162
58
7
963
31.57
7
963
32
No. of
Projects
Manufacturing
Energy
Tourism
Agriculture
Commercial
Building
Transportation
Services
Telecoms
Natural
Resources
Broadcasting
Total
4
2
1
180
208
60
12.43
6.27
5
3
57
70
15403
1.56
1602.99
1
100
3.21
4
2
1
1
28
12389
524.66
3
85
180
208
60
100
12
6
5
3
70
27,792
2
2,128
It can be noted that the manufacturing received 74% of the total planned investment energy came
second with 17% of the investment. If all the investment of 11 projects valued at USD 58million was
to go into agriculture it would have supported employment of 14,162 (51%). Therefore agriculture
has a big multiple effects in terms of employment creation.
Some projects approved by TIC are under development including Dangote Cement which is worth
about a quarter of the planned investments value in Mtwara. Some projects appear to be
consequent upon development of the gas industry and therefore will take more time to take off. A
sectors that may perhaps grow as planned and signs on the ground are strong include real
estate/commercial buildings, broadcasting, and perhaps tourism. Given the capacity and risks,
manufacturing sector will take longer to develop. On overall the picture portrayed by TIC data above
23
is very optimistic but does not reflect things on the ground as most of the listed and approved
projects have not been implemented yet.
4.2
Investment in Agriculture
4.2.1 The 2007/08 Agriculture Census
The 2007 Agriculture Census Report indicated that the two regions had very few large scale farms
compared to other regions. Then, Lindi had 17 establishments of which 9 were for crops only, 5
mixed between crops and livestock and 3 were for livestock only. Mtwara had 28 crops only
establishments, 3 livestock only and 7 mixed.
Table 4.2: Large scale crop and livestock establishments in Lindi and Mtwara (2007)
Crops Only
No. of
hectares
Livestock Only
Livestock and crops
Total
No. of
holdings
No. of
hectares
No. of
holdings
No. of
hectares
No. of
holdings
No. of
hectares
No. of
holdings
723
1
4,893
3
10,486
6
2,500
1
7,221
4
100
2
Lindi
Government
4,870
2
Parastatals
4,721
3
Private
110
2
Others
408
2
1,300
2
80
1
1,788
5
10,109
9
2,023
3
7,473
5
19,595
17
-
-
6,175
1
1,072
1
7,247
Parastatals
493
5
484
3
977
8
Private
155
3
5,332
1
-
-
5,487
4
Others
912
20
4
1
315
3
1,231
24
1,560
28
11,511
3
1,871
7
14,942
38
11,669
37
13,534
6
9,344
12
34,537
55
Total Lindi
Mtwara
Government
Total Mtwara
Grand Total
Large scale farms that had exotic beef and dairy cattle were also very limited, in Lindi there were
only 40 beef cattle and 100 dairy cattle then, while Mtwara had 104 and 676 respectively. The
numbers may as well be skewed towards farms owned by missionaries. The situation may have not
changed much since throughout the field interview respondents failed to mention/recall large scale
farmers.
4.2.2 Potential and Implemented Investments in Agriculture
4.2.2.1 Sugar Production Investment
Initial study on sugar production at Likawage basin and the sugar factory to be built has started.
Investors in Sugar production are Billing Limited, TCD Three Ltd and Sugar Crushing Co. The factory
capacity will be around 3,000 – 5,000 Mt per month. It will generate 12 megawatts of electricity
from residues after crushing the canes, 10 megawatts will be fed into to National Grid while 2
megawatts will be used by the factory. The project will integrate outgrowers. Anticipated
employment is 500 people.
24
4.2.2.2 NDC Sesame Project
NDC has planned to promote a large Sesame Project in Kilwa District at Mandawa about 374kms
from Dar es Salaam where there are 2,000 ha and at Hoteli Tatu some 364kms from Dar es Salaam
where there are 5,000 ha. Another larger cluster is Likawage with 20,000ha (about 380 kms from Dar
es Salaam). Chinese investors have shown interest in investing in this Integrated Large Scale Sesame
and Production Plant Edible Oil Project. It will involve outgrowers. NDC will contribute land and the
private sector will bring in financial capital, equipment, technology and the management of the
project.
Project costs estimates will be established upon finalization of the feasibility study of the project.
About 20,000 hectares have been earmarked available for the Project with some 2,000 hectares
already compensated for. NDC is finalizing processing of land ownership for the project, the
feasibility study is underway. NDC is putting land in the Project, it is inviting the Private Sector to
bring in the necessary finance under the PPP arrangement.
4.2.2.3 Paddy Farm: Young Marcus Limited
Young Marcus Limited is one of the reported local investors who made serious attempt to invest in
food production in Mtwara. The investor (Mr. Msigwa) came to Mtwara as an extension of his
business which is based in Mbarali where he has 1,500 acres. He is also present in Songea where he
has a farm of 500 acres. His
Figure 4.1: Satellte Mapof Mahurunga Valley (Shaded)
presence
in
Mtwara
was
supported by the DC who linked
him to Mahurunga valley with a
potential of 1000 acres. During
2012/13 season he developed
300
acres
that
included
construction of canal 14 kms to
draw water from Ruvuma River to
areas that are being used by
small
holder
farmers.
Unfortunately the land he
acquired proved to be two acidic
which led to poor performance of
the crop. Luckily smallholder
farmers cultivated areas that had
Source: Google map
better soils, they had better yield.
The Investor has not given up investing in Mtwara, he is still in consultation with the District
Authority which has promised him some 100 acres in another area with suitable soils. The soil at
Mahurunga valley can be improved by liming but the cost is usually very high particularly if there is
no source nearby.
4.2.2.4 Vegetables: Fresh Graduate Youths
In their studies, students at the St. Augustine’s University of Tanzania (SAUT) observed that in
Mtwara green vegetables had high prices something that posed an opportunity for smallholder
horticultural farmers. One student tested production of tomatoes in Mtwara Municipal where he
25
planted 1,500 seedlings. They did very well and he collected 46 boxes/crates. At the time of
harvesting the price was TZS 25,000 per crate. After the success four youths joined to establish a
group, in the next season they harvested 70 crates sold at TZS 60,000 per crate that earned them a
reasonable profit.
In 2013 they registered and received support from the Region Commissioner after submission of a
business plan for a TZS 2mln grant to cover farming equipment and water pump. The garden was
located at Lwelu area Jangwani ward. In order to grow systematically, they were advised to initially
focus on Eggplant that is harvested in May – June and was to the company providing catering
services to Schlumberger. The eggplant earned them TZS 4.5mln. The major challenge they faced
had been theft because the crop is cultivated away from residences, in one case they established
that the fruit had been stolen. As an ambition, in July 2014 they opted to go to Kitere where they
have acquired 8 acres. At the time of study they had cleared 5 acres, shortage of labour has
hampered progress. Water for irrigation will come from a borehole.
4.2.2.5 Other Smallholder Investors
A trader 19 of vegetables and fruits at Coco Beach area in Mtwara Municipal has done business with
several people who invested in agriculture but most of the have stopped to deliver or left agriculture
altogether. The list and type of products produced are:•
•
A farmer at Linobe (30Kms ) used to produce pineapple around 2008 and 2009.
A farmer at Msijute area he used to produce oranges, pineapples and tangarines, and has dairy
cattle.
• A farmer at Msijute area where he produced oranges, tangarines, banana and pineapple.
• A farm at Lwelu/Mikindani (about 15kms) he produced pineapples
Three other farmers whose locations were not known produced pineapples and mangoes.
One among the entrepreneurs is more ambitious, he is looking into possibility of processing the
fruits into juice.
4.2.3 Vegetable Production at Kitere
Kitere Basin (and lake) is some 56 kms from Mtwara Town connected by a tarmac road up to
Mpapura (29 kms from Mtwara Town) then a detour to the left on an earth road for 27 kms. The
basin include the valleys of Mpembedi River that drains into
The Kitere Lake sits at an elevation
the Lake and River Mambi that has one of its tributaries
of 130meters above sea level,
originating from Lake Kitere it drains into the Indian Ocean.
latitude -10.3666670 South of the
The (micro) lake is shared among six villages namely;
Equator and longitude 39.7833330
Chemchem, Lilido, Nakida, Chekereni, Mambi and Mkenya.
East of Greenwich.
19
Mr. Abdallah M. Kilete a.k.a Kibanko
26
Kitere ward has a population of 10,524 organized in 2,024 households according to 2012 Population
Census. Major economic activities at Kitere are; horticulture, fishing and livestock. In agriculture the
basin is famous for paddy which
Figure 4.2 : Kitere Lake: Photo and Satellite Map
is estimated to account for 80%
of basin land cultivated and
sesame. Some 511 hectares have
been allocated for paddy
production in the basin, in 2013
the
number
of
hectares
cultivated was 420 hectares
(82%).
One important advantage that
Kitere has is prolonged soil
moisture content in paddy fields
that allow production of
horticultural crops after paddy
has been harvested in late April
and May. Most of the vegetables
come from the paddy fields and Source: Google Earth (November 10, 14:00Hrs)
less around the Lake. Since the
basin is formed by land depression and has a wider catchment area, it swells during rainy season by
up to more than a metre from January up to May. After the rain has subsided water level decline
leaving behind rich and moist black cotton soil that is suitable for vegetable production.
The Case of Tomatoes:
Due to high moisture content in the soil at Kitere, tomato production can be done throughout the
year. However, the main season starts with nurseries in the last week of March, transplanting is
done in fourth week of April when rainfall ends so that there is enough moisture in the soilMtwara
for the
Town
entire crop cycle. The common season calendar is shown in Figure 4.3 below.
Kitere
Figure 4.3: Vegetable production calendar at Kitere: The Case of Tomatoes
Mar
Nursery
Transplanting
On farm management
Harvesting
Apr
May
Jun
XX
XX
XX
XX
Jul
Aug
Sep
XX
XX
XX
Oct
Nov
Dec
Jan
Feb
XX
Vegetables are produced most from July through October, to illustrate the supply pattern, farm gate
price of tomato is quite low in those months at TZS 5,000 to 10,000 per tenga 20 in August –
September, price increase to more than TZS 30,000 (about 2 – 5 times) from November onwards.
The tomato planted after September does not do well because humid and warmer temperature
20
Tomato is measured in plastic buckets, 2 buckets fill 1 tenga.
27
encourages pests and diseases as well as shedding of flowers. The April – September cycle finds the
air a bit drier and cooler.
Kitere supplies significant amount of vegetables to Mtwara market(s), it costs TZS 3,000 to transport
a crate of tomato (about 28Kgs) which is equivalent to TZS 107 per Kg. Some farmers have
attempted to take tomatoes to Dar es Salaam when prices at Kitere are at the lowest ebb in
September. It costs TZS 4,000 to transport a crate to Dar es Salaam which is about TZS 142 per Kg.
Development NGOs involved in supporting horticulture at Kitere, include:•
•
•
•
LIMAS has started support to a group of farmers and has introduced drip irrigation 21 but it’s on
very early stage.
Africare’s “Kijana Jikwamue” Project has also started support to a group of 50 farmers under the
funding of BG. Its focus is both production and market development through establishment and
support to associations.
Agha Khan Foundation under its Coastal Rural Support Programme has been providing support
for the development of sesame and paddy in the area.
TASAF also supported investment in irrigation infrastructure under community initiated and
managed projects. However, the irrigation project requires improvement in management.
In summary Kitere has a significant potential to become a key cluster for vegetable production in
Mtwara because of:
i.) Availability of water throughout the year which is critical for horticulture production,
ii.) Proximity to Mtwara (56kms of which 29 is along a tarmac road),
iii.) Interest of several development NGOs to develop horticulture with an objective of substituting
products from other regions,
iv.) Availability of a strong private sector that has interest in horticulture development including
input (seeds, fertilizers and agro-chemical suppliers).
The challenges likely to face the development of horticulture at Kitere include:
i.
ii.
iii.
iv.
v.
Very low yield hence high cost per unit making products from Dar es Salaam and elsewhere
cheaper.
The supply pattern of products is highly seasonal against which LIMAS had introduced green
houses.
Limited knowledge on market dynamics and related skills by farmers especially on the
Mtwara market
Farmers are yet to be organized into strong and cohesive associations that can attract
suppliers of inputs, financial services and other support at economies of scale.
Lack of a strategy for sustainable utilization of the banks of the lake to minimize negative
environmental impact of increased agriculture. Two issues may become serious, first is
application (indeed over application) of agro-chemicals that may find way into the Lake
affecting fish and other marine organisms. Secondly is an increased soil deposit into the Lake
which according to some fishermen, is happening at a faster pace. The local government has
initiated a tree planting campaign around Lake Kitere, however, cows destroyed the trees as
they trek to drink water in the Lake.
21
The Consultant did not manage to make consultations with LIMAS farmers because of limited time in the
field.
28
vi.
Lack of mechanism to enforce by-laws related to protection of illegal fishing for example
using banned (small aperture) nets is reminiscent of a bigger constraint of beneficiaries
being able to manage the Lake responsibly with increased agriculture activities around.
It may be useful for the development organizations that are interested to support development at
Kitere to strategically have a platform where they can interact and assist in development of a Master
Plan for Sustainable Agriculture around Lake Kitere. While development organizations meet to chart
the strategy, farmers need to be organized Lake-wide and not just in pockets that the projects
operate.
4.3
Non-Agriculture Investments
4.3.1 Mtwara Sea Port
Overview of Mtwara Port: Prior to 2005 TPA owned an area of 70ha, in 2005 it acquired additional
2,623ha for future development of Mtwara Port. This deep water port was built between 1948 and
1954 with the thrust to haul groundnuts from Nachingwea. A railway line was constructed to
connect the Port with Nachingwea (Lindi Region). With the failure of the groundnut scheme, the
railway line was abandoned. At present the quay has a total length of 385m. A sheltered anchorage
exists in the inner bay (basin) with goods holding ground at depths of approximately 20 metres. The
basin can accommodate six vessels of 175 metres. The present port facilities and infrastructure in
Mtwara as well as future expansion plans are: • Cargo handling equipment include 3 mobile cranes of 25-60 actors, 12 trailers, 7 folk lifts, 1 front
loader of 42 tons, 2 reach stackers with a capacity of 45 tons, 2 empty container handlers.
Marine crafts available at the port are 1 mooring boat, 1 tug and 3 security boats. The port does
not have a container terminal because the volume of present does not justify such investment.
• There are two storage sheds with a total storage capacity of about 12,000 tons.
• Mtwara port can handle 400,000 metric tons of imports and exports per annum. The port is
mainly designed to handle conventional cargo. However, the port of Mtwara can handle up to
750,000 MT with the same number of berths if additional equipment is put in place for handling
containerized traffic. The average annual cargo throughput at Mtwara port for the past five
years is 136,500 MT which is only 34% of its capacity of 400,000 MT.
Future expansion programme: Further, to assess the feasibility of this project, TPA has prepared a
Feasibility Study on the Development of Port and Economic Zone at Mtwara which identifies the
cargo forecast, designing the Project facilities and services to be provided and preparation of
preliminary designs.
The amount of cargo handled at Mtwara port has significantly increased during the last two years as
a result of increased economic activities. The increase in cargo has mainly been contributed by the
Oil and Gas exploration companies conducting exploration activities along the coast of Mtwara.
During a period of eleven years, Mtwara port has handled cargo ranging from 132,511 tons in
2001/02 to 234,183 tons in 2011/12 as seen in the Mbamba Bay Port: The TPA has realised the
importance of Lake Nyasa’s Mbambabay Port in Ruvuma Region economic and social aspect and
they have hired a consultancy teams to conduct Feasibility Study and Detailed Design. The
assignment in progress and the consultant is at field.
29
There is a plan to expand the port to cater for the expected increase in traffic following the
development of Mtwara Corridor and gas and oil activities in the Indian Ocean. The Feasibility Study
for the development of port and economic zone has a 19 years (2012-2030) time horizon and has
envisaged new cargoes that have been confirmed with stakeholders. According to the Study, the
traffic forecast is estimated to reach 28 million tons by 2030 as shown in Table 4.3 below.
Mbamba Bay Port: The TPA has realised the importance of Lake Nyasa’s Mbambabay Port in
Ruvuma Region economic and social aspect and they have hired a consultancy teams to conduct
Feasibility Study and Detailed Design. The assignment in progress and the consultant is at field.
The summary of port
expansion plan shows that
by 2013 infrastructures and
4 berths were expected to
be
completed.
The
infrastructures
are
in
progress.
Phase
two
(Medium term) was planned
to prepare the EPZ at
Ng’wale and Msemo area
ready for investments like
cement, fertilizer and biogas
companies as well as bulk
LPG service centre. The
long-term development of
the port is mainly tied to
Mtwara
development
Corridor.
Table 4.3: Summary Forecast of Mtwara Port Cargo Traffic
Containers (TEUs)
2015
2020
2025
2030
Cashew nut exports
9,938
10,972
12,114
13,375
Imported general cargo
10,000
14,026
19,672
27,500
Total Containers (TEUs)
19,938
24,998
31,786
40,875
240
240
240
240
Cement export
1,250
1,250
2,500
5,000
Methanol export
1,000
1,000
1,000
1,000
800
800
800
800
Coal
6,000
11,000
Iron Ore
6,000
11,000
Offshore supply base
('000 tons)
New bulk cargoes('000)
Urea export
Nickel
Total
3,050
45
45
3,095
16,345
28,800
Source: URS (TPA) Analysis
Figure 4.4: Port expansion phases: short, medium and long term plans
Short-Term (2011 - 2013)
Medium – Term (2014 - 2018)
Long – Term (2019 - 2028)
• Improvement
of
available • Development of Ng'wale and • Development of Ng'wale
infrastructures
Msemo area (EPZ investors)
and Msemo area (EPZ
phase One
investors) phase Two
• Expansion of service cargo
o Cement Industry
container –Cashew nuts
• Development of the Port
o Fertilizer Industry
for development of Mtwara
• Construction of four additional
o Biogas
development corridor
berths at Mtwara port
• To be the official center for oil • Build Oil/LPG service centre
and gas exploration.
The development above is expected to
see employment increase from about
440 at present to 2,870 by 2020 as Table
4.4 suggests.
Table 4.4: Current and future employment status of
Mtwara Port
Current
Mtwara Port
180
Oil/Gas companies
200
Other companies
60
Indirect employment
Total
440
Source: TPA Investment Section
Projected 2020
320
400
150
2,000
2,870
30
4.3.2 Dangote Cement Factory
The Dangote Cement Factory has contracted SINOMA, a Chinese construction firm to build the
factory located at Hiari Village close to Mikindani Area about 20 Kms from Mtwara Township. The
factory is said to be the largest in Eastern Africa to produce 6,000 tons a day. Most of the raw
materials are available around the factory estimated to be mined in 100 years. Other materials are
gypsum from Kilwa and red soil from nearby Villages. Chemicals which are used to produce cement
will be imported. During the construction, cement for construction is sourced from Kilwa Cement
Factory, Tanga Cement, Mbeya Cement, Tanzania Portland Cement Company (Dar es Salam). The
HRM reported that the supply of cement to Dangote is inadequate in such a way that Dangote is
importing Cement from China for construction. The quantity of daily consumption of cement was
not revealed, but it was insisted that the consumption of cement in the construction is insufficient.
Employment: The factory construction work has employed 1,200 Tanzanians and 1,000 Chinese in
the construction work. These are paid wages from TZS 12,500 to 18,000 per day. The Tanzania
workers are sourced from the 9 surrounding villages under an organized manner that a job seeker
should register him/herself to the Village chairperson. Once the factory needs to recruit new
workers, the request is send to the Village Chairperson, and the registered names are released to the
HRM for employment. With the exception of Tanzanian experts from other regions, they are
required to apply directly to the HRM. Tanzanians from other districts also should report to the
chairperson of nearby village and be registered. These includes engineers, white collar, technicians,
security officers, suppliers, drivers, earth movers, stone crashers, machine operators and other
service providers. Permanent salaries will begin from TZS 500,000 per month while casual labourers
may receive 12,500 per day. The management has arranged with the CRDB Bank to provide mobile
Bank services at the area once a week. The factory will have more impact through support services
including: - There will be transport within and outside the factory who will be ferrying cement and raw
materials from various sources
- Garage services and workshops for fabrication of parts/spare
- Restaurants, bars,
- Schools, dispensaries etc.
According to the Manager, the type of people currently working at the site and those who will be
employed will just “eat foods staffs available at Mtwara market”. They don’t foresee segments that
will need ethnic – specific foodstuffs.
Linkage to local economy: Dangote Corporate Social Responsibility (CSR) people are negotiating
with 9 surrounding villages on priority projects that will be supported by Dangote. People in rural
areas can benefit directly from the factory if they can supply to Dangote bio-waste materials that will
cut down the cost of energy. Unfortunately there are few crops that can yield economical volumes
of wastes.
4.3.3 Mtwara City Master Plan: Green City Tomorrow and Beyond
Mtwara Municipal is readying itself to host these developments through a city master plan called
“Mtwara Green City: Beyond Tomorrow”, the Master Plan has incorporated all possible investment
potential into account and clustered them into the following areas:31
•
•
•
•
•
•
•
•
•
Petrochemical Industries (gas/oil processing, fertilizers, etc.)
Building Materials Production (cement, etc.)
Community Business Enterprise clusters
Beach Tourism Clusters
Residential Clusters
Financial Services clusters
Mtwara Development Impact Region
Linked Logistic Park
Petro-chemical industries have been earmarked near Madimba Gas processing plant, Mnazi Bay
Natural Gas deposit and the expected new berths at Msangamkuu. Connected to the Petrochemical and building materials clusters will be a Linked Logistics cluster which will extend to
connect with Mtwara Corridor infrastructure. Building materials cluster has been proposed at
Mayanga.
Figure 4.5: Planned Mtwara City Clusters
The Community Business Enterprise Cluster will cover areas of Mbawala, Naliendele and Mayanga.
This cluster is near current and planned extension of residential cluster. Beach Tourism cluster will
exploit the rich Sunday beaches around Naumbu, Msangamkuu and Mikindani areas and offer
convenient access to the airport.
32
The residential cluster which is the largest in terms of area coverage targets to be expanded in
Mbawala, Nanguruwe, Mjimwema and Naliendele areas. The residential cluster will be aligned to
community Business Enterprise cluster and social services sub clusters including University, colleges,
health services, parks. The Financial Services Cluster is located in Mtwara Municipal Council Central
Business District (BCD). To enhance flow of traffic the City Master plan envisages a 40m wide ring
road that connects all the clusters traversing Kisiwa, Hiari up to Mkunwa and from Moma to
Nambeleketela. See Figure 4.5.
4.3.4 Mtwara Corridor Master Plan
The Mtwara Development Corridor (MDC) is a spatial development initiative (SDI) covering Southern
Tanzania, Northern Mozambique, Northern and central Malawi, and Eastern and Northern Zambia.
SDI plan a transportation corridor to ease access to Mtwara port. It involves upgrading of existing
infrastructure and future development and rehabilitation of roads and bridges, sea and lake ports,
telecommunications, air transport facilities and ferry services being the objective of the project.
Improvement and expansion of Mtwara and Mbamba Bay ports, the Port Master Plan was
completed in April 2009.
•
The Tanzania Ports Authority is currently mobilizing funding for the implementation of the port
master plan.
• 2,742 hectares of additional land had been acquired in 2008 for expansion of economic
processing zones.
• AfDB has expressed interest to finance feasibility study and land use plans for two ports,
Currently Mtwara port is being used by oil and gas exploration companies as a supply base, it is
modernized and expanded to accommodate the anticipated increased traffic from oil and gas
operations. Several investors are leasing land from the government for development of industrial
use.
• Fertilizer plants which use gas as raw material;
• Cement producers who get raw materials within Mtwara Corridor;
• Agro-processing industries; and
• Energy companies to feed in the national grid.
4.3.5 NDC Gas Projects
The National Development Corporation (NDC) was established in 1962 as Tanganyika Development
Corporations (TDC) by an Act of Parliament to mobilize finance for large investments. The NDC main
objective is to stimulate industrialization in partnership with private sector. In the gas sector, NDC is
actively involved in designing business models and as a result, they have written three proposals for
gas utilization that include:• Methanol industry for plastic production,
• Fertilizers production, and
• Conversion of Gas to liquid as a petrol.
33
4.3.6 Road Infrastructure in Mtwara and Lindi
Mtwara – Mbamba bay road: Feasibility study for the 824 km Mtwara – Mbamba bay road was
completed in 2004.
• Road has secured funding except from the Mbinga to Mbamba-bay Road Section 66 KM Funding
Source are as follows:
• Masasi – Mangata (56km) government of Japan
• Mangaka to Tunduru (137KM)-JBIC/Govt. of Tanzania
• Mangaka – unity bridge 70km Govt. of Tanzania
• Tunduru – Namtumbo 200 km JBIC/AfDB (Under construction)
• Namtumbo –Songea 67km MCT – completed.
• Peramiho – Mbinga 78 km MCT – completed.
Heavy Capacity Ferry : (HCF) will provide transport services between Mbamba-bay on Tanzania side
and Nkhata Bay on Malawi across Lake Nyasa. The MoU between Tanzania and Malawi was signed
far back in 2003. A feasibility study for Tanzania – Malawi interconnector has not been done due to
lack of funds and the MoU for the whole Mtwara Corridor Programme is yet to be ratified by all
countries.
Tanzania – Mozambique Unity Bridges: Unity Bridge 1 is at Negumano near the border between
Cabo Delgado and Niassa provinces in Mozambique with Mtambaswala on the Tanzania’s side.
Construction of 720 m long bridge was financed by Govt. of Tanzania and Mozambique and
completed at total cost of USD24.6million. This was completed in May 2010. Unity Bridge 2 –at
Mitomoni and was completed in 2008 at total cost of TZS 1 billion, under MDG there is a plan to
construct a railway line from Mtwara to Mbamba bay with spurs to Liganga and Mchuchuma. The
major cargo for the railway will be iron ore and coal from Liganga and Mchuchuma
In this development corridor, industrial development and a promotion of the private projects
investment in mineral resource development (iron ore, coal, and natural gas and non-ferrous metals
such as nickel, uranium and lime stone) are planned. The rail targets to also transport goods from
Zambia, Malawi, Mozambique and part of South Eastern DRC.
4.3.7 Liganga Iron Ore and Mchuchuma Coal
The hinterland of Mtwara near Lake Nyasa have reserves of 364 million Mt of coal at Mchuchuma
and 219 million Mt of iron ore at Liganga whose extraction is planned for 2017. The iron ore will also
yield high value Titanium and Vanadium minerals. While most of the coal to be mined at
Mchuchuma will be for export, some amount will be used to generate 600MW at the mining site.
The exportation will require robust transport system between the mining site and the port.
Liganga is estimated to have over 1.2 billion tons of iron ore of Vanado-Titanium Magnetite. The
project is being developed by Tanzania China International Mineral Resources Ltd (TCIMRL) as an
integrated project with Mchuchuma Coal and mobilization work for conducting detailed study is in
progress. TCIMRL will invest USD 1.7 billion at Liganga to establish iron ore mine and Iron and steel
Complex to produce 1.0mln Mt /year of iron and steel products, vanadium pentoxide and titanium
34
dioxide following successfully bankable feasibility study including upgrading of access road. The ore
mine is expected to start operation by 2015 and production of iron and steel products by 2016.
The sponge iron plant will be established in Ludewa district utilizing iron ore from Maganga Matitu
(part of Liganga) and coal from Katewaka to produce sponge iron. Maganga Matitu Resources
Development Limited (MMRDL) is implementing the project and the shareholders are NDC and MM
Steel Resources Public Limited Company (MMSR PLC). Project due diligence and bankable document
are being finalized. The project capacity will be 330,000 Mt per annum (tpa) of Sponge Iron Plant
with a 45 MW Captive Power Plant. At 250,000 tpa of steel billet will be produced from sponge iron
per year.
4.4
The World Bank Support
The World Bank (WB) is part of the development taking place in the gas sector in Tanzania,
coincidentally Mtwara Municipal is among the Seven cities under the Tanzania Sustainable Cities
Programme (TSCP) to which the World Bank group has committed USD 213 million and the Danish
Government has committed USD $6. The TSCP involves planning cities’ infrastructure to
accommodate the expected growths of urban population. Apart from funding the road project in
Mtwara Municipal, the World Bank Group is working on two strands:i.) The International Finance Corporation (IFC) which is the advisory and private sector support arm
on the WB financing arm is assessing economic avenues that can benefit from the planned
expansion in infrastructure spurred by gas industry. Thus far the opportunities identified include
cashew, oilseeds (sesame) and horticulture.
ii.) The World Bank Group under its section of Trade and Competitiveness Practices (TCP) is looking
into how the interventions related to trade competitiveness can be extended to benefit the gas
and related sectors. TSCP focuses on improving business environment and therefore works on
implementation of standards and certification, licensing and registration of businesses, taxation
and other policies and laws that constrain investments. It is also looking at factor markets
including labour laws, land laws, laws governing capital,
iii.) Under the Growth Pole programme, the WB is developing an integrated infrastructure
programme including road, rail, electricity, water, storage facilities, etc. The objective is to
propose optimal utilization of the infrastructure to be developed.
iv.) Local content project was designed to look into how the local economy can be linked to the gas
industry, it has identified the major opportunity in provision of catering services when the
construction of LNG plant takes offs something likely to be implemented around 2017 or 2018.
With estimated 15,000 workers at peak, they will require 45,000 meals per day. Related to this
likely growth therefore will be a demand for professional catering services in the LNG
construction area. The current opinion of WB is that local capacity may not be present to meet
the international standards needed, it may be necessary for foreign companies to lead the
catering services, local enterprises can be subcontracted in areas that are not critical. The WB
envisages setting up an Enterprise Development Centre focusing on catering services, key
subjects to be covered are around business management.
35
4.5
Promotion of Investments in Lindi and Mtwara
4.5.1 By the Local Government
The respective Government authorities in Lindi and Mtwara have at different levels been promoting
investments in Lindi and Mtwara. In Lindi for example, they have travelled and invited investors from
different countries including Kenya and China. Lindi apparently is
more active than Mtwara in terms of publicity, it has for
There is a plan involving RAS
example:office and TIC to establish a
public-owned Mtwara
- A Regional brief on potential investment areas that was
Investment Company which will
prepared when the staff made a trip to China.
own shares in private
- Lindi Municipal has digitized its profile for easy access to
investment projects.
people interested to grasp at the opportunities.
- The region has prioritized education as a key development
agenda for the Region.
At the time of the study there was no specific regional strategy document for linking the local
economy to the gas economy. Given the sensitivity of the matter in the Regions of Lindi and Mtwara
most politicians discuss issues related to gas cautiously.
4.5.2 TCCIA Mtwara
Mtwara TCCIA has been active in supporting not only existing enterprises but also new businesses.
The services currently being provided by the Chamber include; a.) Information services to the
business community and ICT training to entrepreneurs. b.) Facilitation in the registration of
businesses by receiving, reviewing and dispatching documents related to business registration from
enterprises to BRELA in Dar es Salaam. The type of services currently offered to new registrants is
limited to formatting of documents and facilitation of courier services.
Name search service is charged TZS 10,000, BRELA takes 6,000/= the remaining 4,000 is kept by the
Chamber. Facilitation of Company registration costs between TZS 50,000 ad 100,000/= depending on
the declared capital. At the time of the study 16 businesses and applied for business registration, 38
for name search service. There has been efforts to establish database of businesses existing in
Mtwara, it has not been implemented because some members are not yet convinced about the
benefits of such database/information and has a list of IOCs operating in Mtwara.
The Chamber has attempted to reach out to large oil/gas companies (these are BG, Statoil and
Schlumberger) to sensitize them to join TCCIA as well as positioning TCCIA as an effective private
sector representative. While the large International Oil Companies (IOCs) are not active members i.e.
not participating in quarterly meetings and paying annual fees, TCCIA interfaces with their
representatives in Regional Business Councils (RBCs). Dangote usually sends a representative to
TCCIA meetings. The Chamber however, is optimistic that Mtwara will emerge a significant player in
the national economy and points out that one important signal have been the rapid growth of
financial sector in the region. Banks present in Mtwara include NBC, NMB, CRDB, Postal Bank,
Diamond Trust, Eco bank, CBA, BOA Bank and Bank of Zanzibar. The BOT building is under
construction. As the banks have more capacity to forecast the future there influx is perhaps the most
36
reliable indicator of what Mtwara is likely to be in near and long-term future. However, TCCIA
acknowledges lack of enterprises in agriculture in Mtwara and very limited livestock projects
including the dairy project at Ndanda in Masasi being implemented by the Mission and beef cattle at
Msimbati Ranch owned by the National ranch Corporation.
4.5.3 TCCIA Lindi
Lindi TCCIA like its counterpart in Mtwara has received several capacity building support under
different programmes including those funded by; Finnish Government under DESEMP and now
LIMAS, by Sida and the Foundation for Civil Society. The Chamber has designed its 2014 – 2019
Strategic Plan 22 whose broad objectives are; a.) To increase membership base in the region from the
current 350 (140 being in the Municipal); b.) Looking for funds to offer subsidized training to
members its members and business community on business management following success of
similar trainings. In the past trainers were outsourced from SIDO Regional Office; and c.) Strengthen
services to link members with financial institutions (FIs) including banks of NMB and CRDB and with
Ilulu SACCOS that has more than 500 shareholders and a capital of TZS 500mln 23.
The Business Development Gateway (BDG) Programme that was funded by the World Bank and
managed by Tanzania Private Sector Foundation involved Chambers. BDG was a business plan
competition, it however brought together entrepreneurs in the region who formed a loose grouping,
a (BDG Clubs) which at its peak had around 50 members. Under the same programme a subgroup of
about 30 members was established for TCCIA members who accessed financial services from NMB
BDG partner bank, the NMB Club. The NMB Club helped the bank to reduce the risk of lending as the
Club exerted peer pressure on members to comply. Apparently the BDG Club was disbanded
following misunderstanding by business people who had thought membership to the club was a
ticket for cheap loans from the Bank. The success rate for the BDG prospective grantees in Lindi was
relatively limited, only 5 projects qualified for financial linkage service including brick making, dairy
cattle and agricultural activities.
UNIDO helped the Chamber to setup a Business Information Centre (essentially an Internet café) and
a computer class targeting IT illiterate business community. Some business people turned up for
training during the first few weeks of promotion. Later however, participation of the business people
in computer classes and the Internet Café waned, at present the facilities are widely used by
students and civil servants.
SIDA supported the Chambers between 2004 and 2006, under this support Lindi TCCIA opted to start
a project to provide hall and conference facilities project as a way to help the office raise revenue to
run the office. The Chamber leased a hall from National Housing Corporation in 2006, gave it a
facelift and was used for conference (and social events). The hall was returned in 2011 due to
increased rent by NHC and competition from more than 4 other competitors who had modern halls.
The limited scope of raising funds to meet rent, salary of information officer, and other office
running costs. The Chamber received funds from Foundation for Civil Society to review ASDP/DADP
22
The strategy document was not available in the office hence information provided is from personal
interview.
23
This information has not been validated by SACCOS management.
37
financing in the region, out of the fees the Chamber purchased a motor bike. UNIDO provided
support of 10 computers, a motorbike, a projector and a photocopy.
The Executive Council meets every 3 months whose members are Regional TCCIA leaders and
District Chair and Vice chairs of the sector committees (normally 11 members). The Annual General
Meeting (AGM) is the supreme body, it reviews memberships, budget, work plan, appeal for
membership expelled, etc. It is quite expensive to bring 11 members per District to the meeting, the
last, 2013 AGM got support from various members/local companies. There can be an Extra-ordinary
meeting after 2 thirds of the members put their signature on the motion to hold the meeting.
Prominent businesses that are members of TCCIA Lindi are Imran who runs a Petrol Station and
producer of Ndanda Water, Double M Hotel, Kadogoo Hotel, Lindi Beach Hotel, Nchinga Guest
House and Malaika. Bhavik Construction Limited, Malaika Building Construction as well as Himo
chain of restaurants. In Agriculture supported companies who purchased cashew and sesame METL,
Olam, Abas, etc. The TCCIA offered an alternative source of information on cashew prices in the
World market, the Chamber contributed to inform the policy makers on price. In 2010 TCCIA worked
closely with SIDO to organize and coordinate the SIDO Zonal SME. The Chamber plays a critical role
in coordinating the Nanenane Agriculture Fair.
Efforts to attract the IOCs into the Chamber unfortunately have not been successful as these large
companies are headquartered in Dar es Salaam, while Kilwa Energy and StatOil have moved offices
to Mtwara. However, a point of caution is that IOCs may feel they don’t belong to the Chamber of
Commerce (Trade), Industry (Manufacturing) and Agriculture but instead to Tanzania Chamber of
Mining. The companies the Chamber had tried to reach are Kilwa Energy and StatOil whose main
operations have moved to Mtwara.
On overall, the Chambers still requires support, LIMAS has assisted TCCIA Newala and Liwale to
establish District Business Forums to advocate and lobby for better business environment in their
constituencies. However, the forums have not continued for lack of resources to mobilize,
coordinate and implement agreed agenda regularly.
38
5.0 FOODSTUFFS DEMAND AND SUPPLY IN LINDI AND MTWARA
5.1
Demand by Local Consumers
Assessment of local consumers is based on a limited survey done by the consultant in Mtwara that
involved 28 people. It is supported by data from NBS on income stratification. Demand for Chinese
was established through interviews with HRM of the company building Dangote Cement Factory. For
oil/gas exploring companies, the assessment was done through interviews with companies offering
catering services to workers most of whom work off shore. The projection of labour requirements
for this segment had been difficult where possible data from secondary sources have been used.
Low Income: The main expenditure item is fish that costs about 2,500 per week; it is followed by
staple carbohydrates that cost TZS 1,500 per week per household. On average a household spends
TZS 8075 on beef per week and TZS 592 on other breakfast in snacks like beans, fried cassava,
chapatis, vitumbuas, etc. Fresh vegetables preferred by low income consumers are: mchicha
(amaranthus), Okra and green pepper and the average expenditure on fresh vegetables are TZS 315
per week as compared to TZS 531 and 2,322 with middle and high income consumers respectively.
Local Middle Income Consumers: The expenditure per week as expected is higher by a factor of 3.3
to that of low income. Significant amount of budget is on bread, beef, fish and staple carbohydrates.
Expenditures on fresh vegetables as noted above is TZS 1,225 per week excluding tomato and onions
where they spend about 4,000 per week i.e. between 1.5 and 2kgs) and onions that costs 1,480 per
week per household.
High Income Consumers: these spend about 5 times the
are on beef (TZS 13,839), Chicken (TZS 9,626) and Fish
(TZS9,000). The expenditure of fresh vegetables
averages at TZS 2,322. Unlike the middle and low
income, high income consumers have a wider menu,
they consume the following items that miss on the
menu of other classes; peas, nuts, cornflakes, cheese,
fruits, lettuces, cauliflower, broccoli as well as Irish
potatoes. The high income spends more on fresh
vegetables most likely because of their awareness on
the benefits of fresh vegetables. Note that the data
above excludes tomatoes that costs TZS 1,225 and
onions TZS 500 per week respectively.
low income on food, major expenditures
The findings confirm that traditionally
the population of Mtwara Urban does
not prefer green vegetables, the low
income bracket that is the majority has
recorded the lowest expenditure on
vegetable per household.
Low income households don’t consume
cornflakes, cheese, fruits, lettuces,
cauliflower and broccoli.
5.1.1 Projected Number of Consumers
The Lindi and Mtwara Municipal are projected to have experienced a growth rate of 4.1% per annum
recently, it is projected that the growth rate will strengthen to 4.5% in 2016 as construction activities
pick up. The growth will continue and reach 5% in 2020 before falling to 4.5% in 2023 due to
39
decrease
in
exploration
Table 5.1: Projected number of households by income category
activities. It has to be noted that
- Mtwara and Lindi Municipals
Mtwara and Lindi have the
Mtwara
lowest household sizes in
2012
2015
2020
2025
Tanzania. The situation may
Low Income
75% 19,950 22,549
28,262 35,557
continue for about 5 to 10 years
Middle Income 20%
5,700
6,443
8,075 10,159
as most immigrants will be
High Income
5%
2,850
3,221
4,037
5,080
workers with small families and
Total
28,500 32,213
40,374 50,796
or people whose families are
Lindi
stationed outside Mtwara and
Low Income
78% 14,916 16,537 19,641 25,068
Lindi. The average household
Middle Income 18%
4,688
5,197
6,173
7,878
size for Mtwara is 3.8 people and
High Income
4%
1,705
1,890
2,245
2,865
that of Lindi is 3.7 against the
Total
21,308 23,625 28,059 35,811
national average of 4.8 people.
Source: Estimate from field survey
Error! Reference source not
found. and Error! Reference source not found. summarize the possible number of households in
2015, 2020 and 2025.
Estimated Market Size for Local Consumers.
The market size for foodstuffs in the two towns is based on the population projection in Table 5.2
above and the established household expenditure for the local consumers’ market segment.
Using the NBS data on wage income distribution and interview with HR Officer at the Tanzania Port
Authority (TPA) in Mtwara l data on wage income distribution the Consultant has assumed the
following income distribution pattern among households, for Mtwara low income (less than TZS
600,000 per month) make 75%, middle income whose income is between TZS 600,000 and
1.5mlillion are 20% and high income with income above 1.5 million are 5% which include business
people. For Lindi the low income is 78%, middle income 18% and high income 4%.
Deriving from the average household
expenditure of TZS 9,000 per week on
main food for low income households,
TZS 30,000 for middle income
households and TZS 50,000 for high
income.
Table 5.2: Projected market size for foodstuffs for
Mtwara Municipal in TZS million
2012
2015
2020
2025
Low Income
180
203
254
320
Middle Income
171
193
242
305
High Income
142
161
202
254
493
557
698
879
Mtwara Municipal local consumer Total weekly
2,137
2,415
3,027
3,808
market size in 2013 would have been Monthly expenditure
25,638 28,979 36,320 45,696
worth TZS 490 million per week, TZS Annual expenditure
Source:
Consumer
survey
and Consultant’s estimate
2.13 billion per month and 25.6 billion
per annum. The projection will be TZS 28.9bil in 2015, TZS 36.3 bil in 2020 and TZS 45.7bil. in 2025 as
Table 5.2 shows.
Lindi Municipal is smaller than Mtwara and is estimated to reach 23,625 households in 2015. The
estimated market size will be TZS 20.7 bln in 2015, TZS 24.6 and TZS 31.4 bln in 2020 and 2025
respectively.
40
It is further reiterated that if the
consumer
basket
composition
remains the same then about 76% of
the food expenditure will to bread,
beef, fish and chicken and only 15%
to fresh vegetables.
Table 5.3: Projected market size for foodstuffs for Lindi
Municipal in TZS million.
2012
2015
2020
2025
134
149
177
226
141
156
185
236
85
94
112
143
360
399
474
605
1,560
1,730 2,055 2,623
Low Income
Middle Income
High Income
Total weekly
Monthly
expenditure
Annual expenditure 18,726 20,762 24,658 31,471
Source: Consumer Survey and Consultant’s Estimate
There certainly will be a change in the
structure of consumption because as
income increases consumers prefer
more of the livestock and fish
products over cereals and grains,
even within the fresh vegetables the
types of vegetables consumed expands in favour high value fresh products such as broccoli,
cauliflower, etc.
5.2
The Chinese Consumer Segment
5.2.1 The Consumer Basket
Foodstuff are sourced at Mtwara market by them and brought to their Chinese canteen. The supply
market is not well organized as such, they buy randomly, and take whatever is in the market. Only
one supplier was mentioned, to be one
of the suppliers of vegetables, Travis Figure 5.1: Chinese Consumer Basket by Value
Food &Vegetables General Supply.
Chinese eat fresh green vegetables, fresh
fruits, canned fruits, rice, pork, beef, fish,
bread, chicken, tomato, onions and
potatoes. The team is divided into 5
groups of 200 people each.
The items that took more money in the
basket are bread at 20% of the total
weekly budget followed closely by
chicken at an average consumption of
750 chickens per week by the Chinese
community at Dangote. Eggs make 15%
and beef 13%. In total bread, chicken, eggs and beef take 66% of the expenditure. The green
vegetables that have been the focus of many organizations accounts for hardly 6% of the total
expenditure. In nominal terms it is TZS 2.1mln out of TZS 35mln sales. See Table 5.4 below for more
information. At one time the Chinese bought pigs for pork, they depleted the stock rather faster and
did not find more.
41
5.2.2 Consumption Volumes and Value
The Chinese community eat in a group and rarely will they eat individually outside the work place.
Hence purchase of products is done collectively. According to the data collected the team of about
1,000 Chinese spend more than TZS 35mln on food per week which is about TZS 5,000 per capita per
day for 3 meals (breakfast, Table 5.4: Consumer basket and value in TZS for of Chinese Segment
lunch and supper). The TZS
Product
Quantity
Unit Frequenc
Unit
Total
5,000 per capita is quite
y per
Price
Value
reasonable
and
may
week
exclude other stuffs not
Bread
500
Pcs
7
2,000
7,000,000
Chicken
250
Pcs
3
9,000
6,750,000
captured in the interview.
200
crates
3
9,000
5,400,000
Like with local consumer Eggs
Beef/meat
250
Kgs
2
9,000
4,500,000
market, fresh vegetables
Fish
250
Kgs
2
7,000
3,500,000
don’t make significant
Rice
250
Kgs
7
1,500
2,625,000
percent of expenditure, it
Green
10
crates
3
70,000
2,100,000
is the bread, chicken, egg, Vegetables
1,000
Pcs
2
500
1,000,000
beef and fish that take Fruits
Tomatoes
5
crates
7
20,000
700,000
76% of the food budget.
50
Kgs
6
2,000
600,000
Fresh vegetables and fruits Onions
Cabbage
60
Pcs
3
3,000
540,000
make15% of the budget.
Potatoes
120
Kgs
3
1,200
432,000
For more information
Cucumber/carr
15
crates
7
3,500
367,500
refer to Table 5.4. By
ots/eggplant &
comparison it is estimated
others
5
Kgs
4
3,500
70,000
in …… above that the food Green Pepper
35,584,500
market
for
local TOTAL
Source: Field survey
consumers may be worth
TZS 557 million for a population of 122,417 (projection for 2015) that imply a TZS 4,550 per capita
per week or TZS 650 per day. The 1,000 Chinese are hardly 0.082% of the population but consume
about 10% of the food marketed value.
It happens sometimes that the foodstuff required cannot be found in the town, therefore they have
to look at other alternatives to make sure that the workers get something to eat. Most of the meat,
pork, chicken and eggs are sourced from Dar es Salaam. The most problematic supply is the scarcity
of eggs; they are not found when they are needed. Vegetables are abundant in the surrounding
areas during the rainy season, while in the dry season, the stuff is supplied from Dar Es Salaam.
In conclusion, it can be seen that Chinese market segment is significant at more than TZS 35mln per
week in purchases which translates to about TZS 35,000/capita/week, TZS 4,300/day and TZS
1.5billion per annum. The conclusion above is that:i.
Chinese consumers though small in number, contribute significantly to the demand for food
market in Mtwara.
ii. However, the major expenditure items are non-crop products, they are the bread livestock
products (especially poultry and beef).
iii. Chinese consumers are less strict when it comes to quality and hygiene, they offer a practical
market segment that is useful in the transition phase towards high standards consumers
(companies in oil/gas exploration). Instead they are quite price sensitive.
42
iv. Since the current population of Chinese is largely involved with construction activities at
Dangote, it is rather transient, their number may decline towards the end of 2015 as the plant is
commissioned.
The Chinese consumers are less selective when it comes to quality, they buy what is available at the
Market. They will negotiate the price but less on quality.
5.3
Gas Drilling Companies
Another important target food market segment is that of workers involved in gas exploration and
later exploitation, processing and eventually other spin off factories. The important feature of this
market is that it changes its size depending on each individual company’s activities. The employment
model in gas industry has 4 phases, discovery and appraisal, project design, project development
and production:Discovery and appraisal: This phase employs very few specialized workers and this where the gas
industry in Tanzania is at present (2014). The companies are doing a lot of analysis of data, drilling
test wells and in some cases designing.
Project design: This may take more than 3 years and for most companies in Tanzania this phase will
be somewhere between 2017 and 2018. This phase follows after confirmation of the volume and
other geological details. The design includes infrastructure needed for transportation of the gas to
the point of application.
Development phase: In the design and development phase there exponential growth in the experts
from IOCs and small but steady growth of local employee. This phase may take 4 years that is around
2020 to 2021 for many companies now in the field. At this time there is growth in spin off
investments and employment. Here actual construction of pipelines, gas processing plants and other
facilities are carried out. One such development activity is expected in 2015 at Msimbati and
Madimba.
Production: The number of foreign
workers reaches its peak at this phase
and they start to demobilize and over
a period of 2 years in production
employment
structure
stabilizes
somehow. Most employees are found
in spinoffs, there are more expatriates
in the industry than local employees.
Figure
5.2
is
the
graphical
presentation of the pattern.
Table 5.5: Projected employment around LNG Investment
2015 2017
2018 2022
10,000
LNG
Construction
workers
LNG operators 500
expatriates
LNG local operators
200
Sub-total
600
11,200
Spillovers
500
7,000
Total
1,100
18,200
Source: WB, Statoil Model, authors estimate
2023 onwards
200
1,000
500
2,200
20,000
22,200
43
Figure 5.2: Employment pattern in gas industry
It is important therefore to understand that the impact of gas industry in employment creation is not
near yet and that most work will come from spin off businesses. It is for this reason the Government
plans to make sure that gas is replaced in generation of power with renewable energy so that it can
be used in spin off businesses. Since the industry is in discovery and appraisal phase, employment of
foreign workers is limited somehow. To understand the market size interviews was made with
companies that supply foods to the workers involved in drilling especially off-shore.
Despite the limited scope of this study,
there may be strong indications that
the economies of Lindi and Mtwara
have already picked up, data from NBS
on GDP per capita are suggesting an
upward trend. Mtwara have since 2011
seen a higher growth in GDP than the
national average growth hence the gap
had narrowed between 2010 and 2012
when Mtwara just crossed the national
average.
Figure 5.3: Trend in GDP per capita for Lindi, Mtwara
and National
Whle the figures on average GDP per
Source: NBS
capita do not always imply equitable
distribution of income and therefore
should be treated with caution, discussions with traders confirm increase in money circulation,
diversified consumer basket and ultimatley higher cost of living compared to other towns including
Dar es Salaam.
Project cumulative employment indicates that if all goes well, the Lindi and Mtwara gas industry may
support employment of more than 45,000 people as indicated in Figure 5.4 below.
44
Figure 5.4: Projected employment effect in the short, medium and long-term periods
Source: Various and Author’s estimates
5.3.1 Catering Companies Service Companies Serving workers in Gas industry
5.3.1.1 Supplier No.1
The supplier has provided services to Schlumberger, BG and Statoil for more than 3 years notes that
the number of people involved in exploration activities is not stable, it fluctuates heavily depending
on what is going on at the time. At the time of this survey it was serving between 50-80 people. It
expects that in 2015 when operations in Lindi (Madimba) start there will be more than 200 workers.
The company further notes that it is increasingly buying goods produced in Mtwara and Lindi
particularly during peak supply season when prices are reasonable, this season lasts 3-4 months
from April to June. This is because most vegetables don’t prefer heavy rains, as rainfall recedes it
leaves behind enough moisture to grow vegetables to maturity. From July onwards production has
to be supplemented by irrigation that is quite limited. Thereafter Lindi and Mtwara have limited
amount of green/fresh vegetables and if available, they are expensive and many caterers opt to get
vegetables from Dar es Salaam and Arusha.
The caterer through its client has been supporting projects notably in Mtwara to build the capacity
of local farmers to produce products that are currently imported from other regions. Some 3 groups
are among many being funded by Gas/Oil companies.
i. One group essentially run as a family business at Manguwela village, it produces Chinese
cabbage, Indian beans, Mchicha, spinach, sweet/green pepper, etc. The group is still too small
and has been asked to target the local market. The group that started in May 2014 is also testing
production of other vegetables including beetroots, broccoli, cauliflower, leeks, lettuce etc. It is
looking for loan to expand production in case demand will increase. The project is in its early
stage to be assessed and provide fact evidence.
45
ii. Another group is at Kilimweka some 75kms towards the border with Mozambique. The group is
piloting production of watermelon, cauliflower, red and white cabbages, broccoli, beetroots,
green and yellow pepper, etc. This group started in June 2014 and has 5 farmers who are active,
again the project is in its early stage and members produce vegetables in an area of 1 acre.
iii. The third group is at Kitere which has about ¼ acre it also targets to produce the same type of
vegetables that farmers at Manguwela and Kiliwiko plan.
At present most suppliers are from Dar es Salaam, they include not only fruits and vegetables but
also eggs, tomatoes, fruits etc. The demand for some main products per week are; Tomato 40kgs;
Green pepper 5-15kgs and Red cabbage 3-4kgs. To avoid the risk of poor performance the caterer
has been given a six month contract that will be assessed and subject for renewal/extension.
5.3.1.2 Supplier No. 2
This company has extended its service from mining areas in the Lake Zone where it used to provide
catering services to Tulawaka and North Mara gold mines and therefore has good experience in
sourcing and supplying to foreigner workers. It provided services to BG and Ophir who during their
operations had about 200 people at a time.
It has three sources of foodstuffs, it has contracted a local (Mtwara – based) supplier for only dry
items that include bottled water, sugar, soap and the like. In Dar es Salaam they have a supplier of
frozen products that include fish, chicken, etc. Fresh vegetables on the hand has been contracted to
a supplier based in Arusha using a refrigerated truck. A demo plot was established at Naliendele
where the company provided initial capital, seeds for cucumber, sweet melon. Unfortunately the
group left the horticulture business to continue with traditional cashew collection.
Products that are imported by the company include milk imported from South Africa, pork from
Brazil or Germany, and beef from Botswana. For drinking water, they tested locally produced
Ndanda and other brands but approved Kilimanjaro brand.
Food Quality: This market segment is quite sensitive to food quality, they have in place an elaborate
quality assurance system. Most companies have doctors who are responsible for food safety. They
make frequent test before use through sampling. They keep samples of food taken over a period of
time.
Stage 1: the companies assign persons to visit and assess farming practices with the aim to establish
if pesticides being applied are those permitted and are used in right amount and frequency.
Stage 2: samples are taken before the food is cooked/prepared for testing by specialized food
specialists who tests the food against many health hazards. Thus far there has no serious incidence
of food staffs failing the tests. For beef the company purchases beef from suppliers who have clean
bill of health from officials. Refrigerated trucks are used in transport to maintain the freshness.
Challenges of Local Supply: The company notes that integration of local agri-business in Lindi and
Mtwara is a challenge because the population in these areas does not realize the long-term potential
of commercial horticulture unlike their counterparts in the Northern and Lake Zone. Catering
companies have contracts awarded on efficiency, quality and cost-effectiveness there is limited
46
room for the companies to invest in training and supporting farmers in a big way. The seasonality
challenge that characterizes most of the commodities in the country is another challenge for
producers in Lindi and Mtwara. Economies of scale on procurement (ability to buy many things at
single source) is another important factor, while in Dar es Salaam and Arusha they can supply a
range of products at once, it is difficult to do that in Mtwara and Lindi.
5.3.1.3 Supplier No. 3
This company is based in Mtwara and has been in the business of hostel and catering for more than
3 years. In total there are more than 50 items that are needed to prepare meals, since the target
workforce comes from different ethnic background hence tastes. The company has space for the
accommodation of 120 people and notes that the accommodation and food supply service are
seasonal making is sometime tricky to get into contract with farmers to produce specific products.
SBS gets few vegetables from the local market in few months, the main supplier for fresh produce is
based in Arusha. Poultry products are purchased from local suppliers at a rate of 500kg/month for
chicken, beef come from Kenya since the quality of local beef is poor and there is lack of meat
cutting facilities in Mtwara. Fish mainly of Sato type comes from Mtwara. Pork is imported
altogether for fear of diseases, so is lamb. Dairy products like creams, yoghurt and cheese are
imported.
Challenges and some recommendations: From its experience, the company notes that to overcome
the problem of seasonality in South Africa they introduced green houses, as it is the local suppliers
are incapable of addressing the seasonality issue. The issue of soil quality may have not been
discussed because it is too technical, it appears soils salinity has some influence on the quality and
taste of foodstuffs, the proprietor has noted that there is a difference in taste for a similar product
produced in temperate areas and the one produced on the coastal areas 24. In order for smallholder
farmers to link to catering companies concerted efforts and resources are needed from the public to
develop the farmers. A programme like LIMAS needs to understand that development of the
smallholder farmers is a process that requires taking some risk and is resource intensive.
5.3.1.4 Supplier No. 4
The company hosted and provided meals to Halliburton Company that was involved in gas
exploration, it accommodated between 18-20 people at its compound and since May 2015 the
workers have moved to Msimbati and Msangani that, at the time of interview, had 120 and 25
people respectively. At the time of operation the company used to purchase products that are
available in Mtwara particularly fruits particularly mangoes, oranges and pineapples during
December through January.
For fresh vegetables they relied solely on Dar es Salaam because a number of vegetables could not
be found in required quantity and time, the type of products that grossly missed in the market
included zucchini, broccoli, lettuce, beetroots, butternuts, green beans, cauliflower, carrots, etc. For
products that are available in Mtwara they are relatively expensive compared to Dar es Salaam even
if one could factor in transport cost. To illustrate the price difference, a frozen 900gms chicken that
24
While the subject of soil quality is critical to determine what crops will do well in Lindi and Mtwara, it is
beyond the scope of this report.
47
sold TZS 5,000 in Dar es Salaam was quoted at TZS 7,000 in Mtwara. There had been no meat expert
and meat cutting facility, no one makes beef fillets in Mtwara. One retired citizen had planned to
start a meat cutting unit but he never installed them possibly for lack of strong market signal. A
butcher at Magomeni area acknowledged that even health officials are not serious in enforcing
hygiene regulations and elucidated that no foreigner would dare to buy meat in Mtwara if he had
seen the abattoir.
Suppliers in Dar es Salaam were selected after assessing the product quality, hygiene, availability of
cooling facilities, knowledge and practicing on sorting and grading, and packaging. One weakness of
local suppliers had been mixing of incompatible products when packaging and or transporting.
Poultry products in Mtwara are expensive compared to many parts of the country. Chicken is sold
per head not per kg and there are no serious broilers, eggs retail at TZS 7,000 to 9,000 as against TZS
5,000 to 6,000 in Dar es Salaam. As for milk the company used to use powder milk (Cowbell), cheese,
butter, etc were from Dar es Salaam. A 10Mt refrigerated plies between Mtwara and Dar es Salaam
to purchase foodstuffs after every two weeks. The total cost of running such a truck return trip is
estimated at TZS 900,000 to 1,000,000. If it carries a 8,000kgs the cost per Kg of cargo is TZS 113/kg
and for TZS 1mln it is TZS 125 per Kg this way the bulk and weighty cargo cancel each other in terms
of cost per unit making purchasing in Dar es Salaam competitive.
Coral finds the seasonality of supplies for local production, lack of business skills among farmers and
traders are a serious challenge in linking farmers to emerging niche markets. In the meantime more
attention should be paid to Chinese who are less demanding on food quality.
5.3.2 Projected Demand by Expatriates in Gas Industry
Non-Chinese expatriates have a more sophisticated menu in terms of the type of foods they require,
to use the example of one companies that caters for workers in rigs (currently making 120 meals per
day, 840 meals per week), the company uses more than 50 items weighing about 410kgs. See list in
the Tile below. The ten bulkiest items in the list that perhaps should be among the priority products
Table 5.6: Estimated demand for fresh vegetable and fruits by expatriates market
For 120 meals
per week
Per one meal
Per day for 2
meals /person
Per month for 2
meals/person
Per annum for 2
meals/person
1,000 workers =
60,000meals/month
2000 workers =
120,000meals/month
5000workers=
300,000meals/month
Potatoes
Carrots
Pineapple
Cabbage
White
Onion
red
Water
melon
Tomatoes
Cauli
flower
Kg
Banana
ripe
Jamaica
Kg
Kg
Kg
Kg
Kg
Kg
Kg
Kg
100
30
30
25
20
15
15
14
0.12
0.04
0.24
0.07
0.04
0.03
0.02
0.02
0.02
0.02
0.07
0.06
0.05
0.04
0.04
2.86
0.86
0.86
0.71
0.57
0.43
34.29
10.29
10.29
8.57
6.86
5.14
7,143
2,143
2,143
1,786
1,429
1,071
4,286
3,571
2,857
10,714
8,929
7,143
4,286
35,714
4,286
10,714
Source: Sample Catering Company
12
0.01
Lettuce
yellow
Total
Kg
12
273
0.01
0.325
0.03
0.650
0.34
7.800
0.03
0.03
0.43
0.40
0.34
5.14
4.80
4.11
4.11
2,143
1,071
2,143
1,000
2,000
857
1,714
857
1,714
5,357
5,357
5,000
4,286
4,286
93.6
19,500
39,000
7,500
48
for local production in order to save on transport are by declining weight; Potatoes, Carrots,
Pineapple, Cabbage White, Onion red, Banana ripe Jamaica, Water melon, Tomatoes, Cauliflower
and Lettuce yellow. It is true that with an exception of Irish potatoes, there have been initiatives to
promote production of carrots, while cabbage, water melon, tomatoes and lettuce.
The demand for the above products will grow significantly when the construction of the LNG plant
start around 2018.
It can be noted that a camp of 5,000 workers
will require about 36Mt of Irish potatoes per
month, 10mt of carrots and pineapple. Other
important vegetables are cabbage white at
about 8Mt, Onion red and banana ripe Jamaica
at around 7Mt per month.
Note that WB estimates that during the height
of construction work in year 2 through 4 of
construction of the LNG plant, meals per month
will range from 900,000 to 1,350,000, these two
figures are multiples of 2 and 3 from the
estimate above.
5.4
Items on the menu of gas expatriates
Potatoes, Carrots, Pineapple, Cabbage White, Onion red,
Banana ripe Jamaica, Water melon, Tomatoes,
Cauliflower, Lettuce yellow, Broccoli, Onion white, Sweet
melon, Baby marrow (zucchini), Butternut, Cabbage
Chunese, Cucumber, Leeks, Pumpkin, Aubergine (Egg
Plant), Avocado, Cabbage Red, Celery, Grapes red, Grapes
white, Lemon, Lettuce Chinese, Pawpaw, Raspberries,
Red pepper, Strawberries, Turnips, Green pepper,
Mangoes, Yellow pepper, Asparagus, Onion Spring, Basil,
Chili green, Chili red, Coriander, Mint, Orange (imported)
and Parsley.
Demand of Foodstuffs by Hotels and Restaurants
Another segment that may cater for both local and foreign consumers is the hotels and restaurants,
it has however to be understood that Mtwara is more active in terms of upper market hotels
compared to Lindi. In Lindi the largest hotel is Lindi Beach Resort with 16 rooms. Apart from this
survey, the report has enriched its findings with a study commissioned by LIMAS to support
WABISOCO to establish a supply chain destined for upper market hotels and companies operating in
the gas industry.
5.4.1.1 Hotels and Restaurants in Mtwara
VETA Hotel Mtwara receives about 30 customers daily who take meals there. It is estimated that
85% of their customers are participants of seminars, workshops, short course trainings and
Government officials. Foodstuffs consumed at the hotel are: assorted green vegetables (mainly
mchicha, spinach, Chinese cabbage, cow peas leaves, eggplant, yam, carrots, tomatoes, onions,
green pepper, garlic, ginger, etc.), fruits, dry foods like rice, maize flour, beans, assorted spices, meat
(Beef, fillets), and fresh milk. Also sea products (fish filets, whole fish), chickens.
49
Supply of Foodstuffs: The supply of foodstuffs used at VETA Hotel has been contracted to local food
supply companies. The main supplier of vegetables is Mchepa Vegetable Farm. It has been reported
that the supplier has organized small farmer groups in the villages who supply him with the
vegetables around March through June. Supplies from Mtwara are suppressed from July onwards as
lit is too dry, this time most of vegetables are brought from Dare Salaam. Ginger and other spices are
bought at Mtwara general market. Carrots
Table 5.7: Weekly supplies of foodstuffs to VETA Hotel
and cabbages are purchased from Dar es
Type of Vegetable
Quantity
Price in
Value
Salaam throughout. The supply of dry
(in Kgs)
TZS
(in TZS)
goods (maize flour, rice, beans) has been
Mchicha
30
1,000
30,000
contracted to another company, Edno
Spinach
30
1,000
30,000
Investment Ltd. The Company supplies
Cowpeas
20
1,000
20,000
rice, maize flour and beans weekly worth
Peas
30
5,000
150,000
TZS 90,000 as shown below.
Green pepper
15
4,000
60,000
Livestock Products: The supply of beef,
beef fillets, fish whole and fish fillets,
chicken and milk are also supplied weekly
by Edno Investment Ltd. The supplier buys
some foodstuff locally from supermarkets
in town including from Alfa Super Market
at Shangani area, Muhoma Supermarkets
in Ligula area and Mtwara Super market at
Mtwara Town centre. Fresh milk is
supplied locally during the wet season and
from Dar es Salaam during the dry season.
Table 5.7 shows the type quantity and
prices of food stuffs supplied to the Hotel.
It is important to note from the table that,
just as the consumer survey has confirmed
that livestock products make the bulk of
products and in the case of this hotel out
of TZS 3.6mln spent on foodstuffs TZS 3.1
(88%) goes to livestock products. Fresh
vegetables account for TZS 350,000 or
about 10%.
Carrots
Sub-total
Type of Dry Food
Rice
Maize Flour
Beans
Sub-total
Livestock Products
15
4,000
Quantity
(in Kgs)
Price in
TZS
20
50
50
2,000
1,500
1,800
Quantity
(in Kgs)
Price in
TZS
60,000
350,000
Value
(in TZS)
30,000
30,000
30,000
90,000
Value
(in TZS)
Beef
50
9,000
450,000
Beef Fillets
10
15,000
150,000
Fish whole (pcs)
200
3,000
600,000
Fish fillets
20
10,000
200,000
Chicken- Broiler (pcs)
100
11,000
1,100,000
Chicken- Local (pcs)
50
13,000
650,000
Milk
Fresh(small
packets) (carton)
1
4,500
Loose fresh milk (lts)
20
1,800
4,500
36,000
Sub-total
3,190,500
Total Budget for Main Foods
3,630,500
Source: Field Survey
Quality Issues: The Chief Cook is responsible for investigating and sorting out the products by visual
inspection. The Hotel accepts some packed food products from supermarkets with TBS stamp or an
International standard label and valid expiry date only. There are no institutions/organizations that
certify/test food quality in Mtwara that are used in hotels. Normally at tendering stage the supplier
must present documents necessary for running foodstuff business including Business License, TFDA
certification of foodstuff and approved tender documents. The Management of the Hotel believes
that the food products sold are in good condition and safe as far as the suppliers have TFDA
certificates.
50
Procurement Arrangements: Tenders are advertised in the mass media, applicants are provided with
special forms, tenderers are informed of the procedures. The Hotel Management is mandated to
select the suitable suppliers. Re-ordering is done 2- 3 days before the stock is finished. The
procurement officer makes sure that here is a buffer stock for 3 to 4 days for emergency. The
supplier arranges for transport and incurs the all the costs up to the hotels kitchen/store.
Challenges Facing the Hotel in Food Catering Services: The main challenge facing the limited range
of foodstuffs in the market and availability. Another challenge is price fluctuation which occurs
seasonally at the local market. The hotel has to align its prices with the market prices. Sea products
are in high demand in the hotel market 25, but Table 5.8: Sample price difference between Mtwara
supply is low and not consistent, quite often it and Dar es Salaam
has to order from Dar es Salaam. Unreliability
Item
Mtwara Dar es Difference
of deliveries forces the Hotel to carry more
Salaam
stocks which adds cost.
Beef
fillet
17,000
8,000
113%
(TZS/Kg)
5.4.1.2 Msemo Hotel Mtwara
Chicken (TZS/Kg)
Tomato (TZS/Kg)
Carrots,
green
pepper (TZS/Kg)
8,500
2,500
3,500
5,000
1,200
1,500
70%
108%
133%
Target Market segment: Msemo Hotel is
frequented by foreigners, the Whites, Indians
and Chinese, they are estimated to make 65%
of the customers. The remaining 35% are Source: Field Survey
Tanzanian families who came with their
friends, children and relatives to spend weekends at the hotel. The major consumer group is the
Chinese, they usually visit the Hotel in groups hence make a larger share of the market in terms of
revenue. At the time of the survey, the number of customers had dwindled following the May 2013
civil riots over Government plan to pipe the gas to Dar es Salaam. The riots paralyzed social services
and hotel industry in Mtwara. Since then, the Hotel lost about 60% of her customers.
Type and sources of supplies: Most of the beef, chicken, eggs and milk are supplied from Dar es
Salaam, they come by air and are charged TZS 1,000 per Kg, and almost 80% of the supplies are
brought by air. Arrangement is done in Dar es Salaam by long experienced Indian business people
who source special type of meat/beef and arrange for transport to Mtwara. The owners of the
butchers and poultry in Dar es Salaam are registered and certified by TFDA. Food supplies from Dar
are kept under freezing temperature in special cool boxes. The Manager notes that for most items it
is cheaper and reliable to place orders from Dar e Salaam than to rely on Mtwara.
Weekly supplies depend on the type of visitors/clients received. Weight and packages also are
negotiable with a supplier according to the weekly needs of the Hotel. In case of emergency, beef
and fillet are supplied by Alpha Export Ltd and Jafari Suppliers Ltd. in Mtwara. Chicken are supplied
by Kuku Poa Company in Dar e Salaam. Seafood is sourced fresh within Mtwara though most of it is
not available in Mtwara, its purchased from Kisutu Market in Dar es Salaam. Few of the vegetables
are supplied by Garden Kevin in Mtwara. Rice maize flour, wheat flour and beans are supplied by
local suppliers.
25
Note the conclusions and recommendations
51
5.5
Specialized Fresh Vegetable Suppliers
In major towns there are convenience kiosks that do vegetable and fruit vending, their key value
addition in the supply chain may include
logistics that is making products are closer to Table 5.9: Major sources of food supply for Edino
consumers, sorting and grading, because Investment
these outlets have limited regular customers Item
Source
Quantity in
they have to assure them of quality and
Mt per
consistency in order to retain them. Below is
annum
an account of some few interviewed in Rice
Kyela
2
Mtwara and Lindi
Rice
Mtwara
10
5.5.1 Edino Investment
Rice
Ifakara
Beans
Mtwara & Songea
Maize flour
Mtwara
Cooking oil - Dar es Salaam
Sunola
Tomato
Iringa and Kitere
Meat
Ikwiriri famers
Milk
Own cows
Source: Field Survey
50
5
50
10 cartons
Edino Investment was established in 1997
with the aim of supplying foodstuff to various
schools, hotels and other government
8
institutions in Mtwara and Kagera Regions.
3
The proprietor owns two hotels in town called
5,460lts
Victory and Lemon Tree Hotel. The company
supplies foodstuffs to many organizations in
Mtwara including Naliendele Agricultural Research Institute and Sabodo Secondary schools, VETA
College, VETA Hotel, ATS, COTC and Victoria Hotel.
Sources of foodstuffs: Edino supply beans, maize flour, rice, sugar, sunflower cooking oil, onions,
tomatoes, meat and milk. Rice is bought from
Ifakara mainly; however 10tones is bought Table 5.10: Supplies handled by Epam per week (in
locally from Mtwara during the month of June Kgs)
to August. High quality rice for hotels is
SODEXO
MDO
RSS
brought from Kyela. Beans are brought from
Tomatoes
50
50
30
Songea. Tomatoes are bought from Kitere dam
Cabbages
200
200
100
from October to December while other months
Carrots
50
50
20
she buys from Iringa.
Green Pepper
50
50
20
1,000
1,000
600
Meat: Cows from Ikwiriri livestock keepers and Potatoes
50
50
30
slaughtered in Mtwara Butchers. She was Onions
150
150
100
selling 1,276kgs monthly during past years, but Rice
50
50
30
now 2014, she sells only 250kgs. She stopped Beans
30
30
20
supplying to Government institutions because Banana ripe
30
30
20
they don’t pay in time and till today, about TZS. Water melon
Total
1,660
1,660
970
300 million not paid by Prison Authority since
Grand Total
4,290
2009. Milk come from own source, she has 12
cows which gives 105 liters per week and Source: Field survey
selling at TZS 2,500per litre.
52
5.5.1.1 Epam Store and Investment
Epam supplies fresh fruits and vegetables to companies and individuals based on contract or orders.
The main source of their products is Dar es Salaam markets (80%) in low season and Mtwara market
(20%). It supplies products to the companies offering catering services to Oil/Gas industries
(SODEXO, MDO and RSS from Mozambique). Supply on weekly basis are close to 4mt which is quite
significant. All fresh vegetables are delivered in crates Tomato are sourced direct from their farmer
from Nabwada Basin.
5.5.1.2 Vegetable Kiosk Operator (Town Centre)
A lady who operates a makeshifts Kiosk down town procures all her requirements from Dar es
Salaam, in Dar es Salaam she has a relative who usually consolidates the cargo and logistics. The
major source market for FFVs is Temeke Stereo. The cargo is consolidated into special “viroba” has
allow air through and “tengas” products that goes into a tenga are watermelon, orange, ripe banana,
and cucumber. Robas are used to pack plantain, carrots, peas (green) and passion fruits. The
consolidation of the cargo and transport to the bus stand at Temeke Sudan is done by push cart
youths.
The cost of loading at Temeke Sudan plus transport from the market is TZS 20,000 for while
consignment. Transport is by bus, a tenga costs TZS 12,000 to 15,000/= and TZS 5,000 for a loba. A
create of tomato is charged TZS 4000 – 5000/=. cess at Temeke is TZS 1,000. On average the
different between wholesale purchase and selling of vegetables form Dar Salaam in Mtwara is 62%.
The weekly turnover is: • 4 lobas containing peas, carrot, beans, cucumber, etc
• 6-7 bunches of plantain
• 2-3 cartons of apples.
The main customers are Africans of middle income followed by whites at 20%. Chinese and Indians
do rarely visit the Kiosk. Whites main items are fruits especially apples, water melon and mangoes.
Competition is not an issue to the kiosk operator; she estimates that there may be around 6 of them
downtown. She does to promote her business not she has approached the large food supplying
companies. She notes that caterers in the local market do come to buy peas, plantain and carrots
but not as frequent.
Table 5.11: Foodstuffs supplied by Travis
5.5.1.3 Travis Food &
Vegetable General
Supply
The company supplies mainly
vegetables to SINOMA, the
Chinese contractors of Dangote
Cement Factory. Vegetables are
sourced from Mpapura and
Msijute Villages in Mtwara Rural
District. Cabbages, Cucumber,
Onions, broccoli, celery, green
pepper and carrots are supplied
under weekly bases. In one bag,
Product
Cabbage/Pc
Qtty per Frequency
day
per week
Roba 5
3
Unit
Price
75,000
Value (TZS)
1,125,000
Chicken
200pcs
3
8,500
5,100,000
Broccoli, celery,
green pepper,
carrots,
egg
plant & others
Cucumber,
Onions,
Eggs
5 bags
3
30,500
457,500
2 in small
bags
50 crates
3
35,000
210,000
3
7,000
1,050,000
Source: Field Survey
53
25 pcs of cabbage is packed @ 3.6 kgs. Eggs, meat/beef and chicken are sourced from Matuli Chick
Farm Fresh in Dar es Salaam, the main supplier of chicken to Travis.
Epam supplies fresh fruits and vegetables to companies and individuals based on contract or orders.
The main source of their products is Dar es Salaam markets (80%) in low season and Mtwara market
(20%). It supplies products to the companies offering catering services to Oil/Gas industries
(SODEXO, MDO and RSS from Mozambique). Supply on weekly basis are close to 4mt which is quite
significant. All fresh vegetables are delivered in crates Tomato are sourced direct from their farmer
from Nabwada Basin.
5.6
Grain Millers in Lindi and Mtwara
5.6.1 Millers in Mtwara
Mtwara Municipal uses maize from within the region May and August, in other months major
sources of maize and sometime packed flour are surplus regions of Ruvuma and Tanga. There had
been time when Mtwara received maize from as far as Uganda and sometime from Northern
Mozambique. As roads improves over time, the contribution of transport cost to the final cost is
decreases because better roads attracts competition and truck operating costs is low. On average
transport from most sources adds between TZS 120 and 130 per kg.
Price trend: During the average production year the price of maize flower in April through June is
around TZS 750/kg, it increases to TZS 920-1,000 between January and March. Thereafter produce
from within Mtwara dominate the market and prices start to decline as
Table 3.2 indicates below for 2013.
Table 5.12: Retail Price of a Kilogram of maize flour in Mtwara Municipal in 2013
Month>>
Price
(TZS/kg)
April
740
May June July August Sept. Oct Nov Dec Jan Feb.
750
750 750 800
800
840 850 880 920 1 000
March
1 000
Prices were abnormally high in 2012 when the price of maize recoded a price of TZS 90,000 per
100kgs bag against an average of TZS 50,000-80,000.
The inflow of grain from other regions into Mtwara town is estimated by the miller at around
350mt/week for rice and 300mt for maize, maize is traded
at Mikindani and Msijute. Institutions purchase rice and Cassava flour is not favoured by
maize flour through traders who have been awarded urban consumers in Mtwara as a
tenders. Major ones in Mtwara include are Tanzania result it is not part of the products
Education Institute, Prison, and some Boarding Secondary
being marketed by millers.
Schools. It has been difficult for millers to get tenders to
supply foodstuffs directly to institutional consumers
because lack of transparency and some employees having interests in the business. The Whites are
known not to buy maize and rice from millers. Chinese buyers prefer rice over other grains but they
are not very regular buyers, they bargain very hard and have many options.
It is estimated that there may be 6 large millers in Mtwara Town and many other smaller units. The
miller has no large farmer within Mtwara DC who supplies large amount of maize and/or rice/paddy.
He attributes lack of large scale farmers to some natural factors and most likely soils and or rainfall
54
amount and pattern. The miller is of the opinion that salty soils are the cause of poor agriculture
performance. Better soils are found in Masasi, Newala, Tunduru, Liwale and Nachingwea. Refer to .
Rice from within Mtwara comes into the market earlier than other parts of the country in April and is
available till around June. Tandahimba District is the main producer of paddy along Ruvuma River.
During May - June period some Mtwara rice is shipped to Dar es Salaam because the price then is
very attractive in Dar es Salaam that offers a window of opportunity for LIndi/Mtwara farmers.
Grain millers have little knowledge on maize flour quality issues especially on moisture
measurements, hygiene, food safety, packaging and the whole issues of Afflatoxins in maize and its
flour. Another miller noted that she has never been able to sell maize or rice to companies that
supply food to gas workers, the Chinese prefer rice over maize but they have never purchased any
rice at her mill.
5.6.2 Millers in Lindi
In Lindi 3 millers were surveyed, grains available for milling are paddy, maize and to a small extent
Sorghum. Quantity for each crop depends on the Table 5.13: Quantity of Paddy Processed per week
performance of rainfall. Processors indicate that
by millers in Lindi (In Metric Tonnes)
paddy is the major crop milled, for miller No. 1
Peak season
Low season
paddy accounts for 70% of the operating time, Grain Miller
maize 27% and sorghum about 3%. The two
(6 Months)
(6 Months)
other millers process only paddy. Paddy comes Khaif
50
25
from different sources including from other
VARA
30
10
regions notably Ruvuma and Coast Region
70
35
(Ikwiriri). Sources within Lindi are Lindi Rural Tumaini One
(Milola, Kinyope, Rutamba, and Kiwalala. Maize Source: Field Survey
comes mainly from Ruangwa, Nachingwea,
Masasi, Tunduru and Songea. The machines are very busy during June – November period. The three
millers are estimated to process 5,700mt per annum.
Table 5.14: Retail price trend for rice and maize in Lindi Municipal in 2013
Jan
70
Feb
70
Mar
70
Apr
70
May
80
Jun
45
Jul
45
Aug
50
Sep
60
Oct
60
Nov
60
Dec
60
Paddy/Bag
(TZS'000)
Rice/Kg
1,400 1,400 1,400 1,400 1,450 900 900 1,000 1,100 1,250 1,300 1,300
Maize/kg
600
500
500
450
450 450 450
500
500
500
500
600
Maize Flour/Kg
1,000 800
800
800
800
800 800 800
800
800
800
1,000
There is good amount of maize flour that come from other parts of the country via Dar es Salaam,
hence the milling capacity of 5,700mt by the 3 larger millers is just part of the supply into the town.
5.7
WABISOCO and Vegetable and Fruits Kiosk Operators
5.7.1 WABISOCO
Mtwara market is the main food market that supply all food varieties throughout the year from
different sources, within the region and outside the region. Talking to WABISOCO leader he said,
55
supply trend of food items at the market has changed compared to the past 5 year, the dependency
of food from outside Mtwara and Lindi has decreased, it is estimated that about 5 years back, the
Municipal markets depended on other regions at 65% for fruits, 55% for green vegetables and about
80% for cereals.
About 50% of the products are delivered at the market direct from farm by farmers most of whom
are in peri-urban and from Kitere, the remaining 50% passes through traders/middlemen. For
products produced within Mtwara, the products are transported in trucks of 2 to 5 tons from farm to
the market daily. Usually market operators will bargain hard with farmers and get relatively cheaper
price compared to middlemen. The variation is selling prices between farmers and middlemen is due
to limited knowledge by farmers on market dynamics that many times involve timing. Procurement
arrangement is not formal though
Figure 5.5: Profitability of vegetable business at Mtwara,
they have communication with
Lindi and Masasi in September 2014
product suppliers. Currently the
main source point of product is
Kitere that is about 60Km from
Mtwara Town.
Analysis of profitability of
vegetable business shows that
the traders make an average
margin of 45%, the margins are
25% to 28% for tomatoes and
highest for green pepper (at 74%)
and carrots (59%) and cabbages
(58%).
The supply of green vegetables in Mtwara, Lindi and Masasi confirms the information provided by
farmers and traders, using tomato as an indicator prices are high in January through April when they
start to fall reaching the lowest around July, from September they start which price pattern shows
that NB: Brokerage fee is 10% of the selling price in Mtwara market.
WABISOCO had been working with LIMAS to introduce an improved market facility that will be
dedicated FFVs. Under the agreement with LIMAS, WABISOCO was to acquire land and build the
structure and LIMAS was to provide equipment for storage, promotion and technical assistance.
However, WABISOCO has failed to acquire the land needed and is afraid that since recently the
Municipal Council has dropped WABISOCO as the agent for levy collection at the general market, the
cooperative is afraid that even the new market will be ceded to the Municipal in terms of levy
collection. Failure of the cooperative to collect the levy will limit their capacity to pay back the
investment and it seems WABISOCO had expected that LIMAS will build the structure.
56
6.0 LIKELY IMPACT OF GAS INDUSTRY ON FOREST RESOURCES
6.1
Stock of Forest Resources
Lindi and Mtwara are traditional suppliers of hardwood timber to major markets, in the past it had
been plagued by serious illegal logging that threatened the ecosystem in that part of country. The
TRAFFIC report has revealed the scale of destruction of forest resources and the entrenched
networks that facilitates the illegal trade.
In response, donors and particularly Finland has been supporting initiatives to protect natural forests
by promoting the participatory approaches to management of forest resources. The creation of
Tanzania Forest Services company (TFS) was a key milestone in instituting better governance of the
forests in the country. Lindi is privileged to be the headquarters of the Southern Zone of TFS. It has
been promoting CBFM in its Forest Reserve in Tunduru and Songea (for Ruvuma), in Mtwara District
the Forest of Naliendele, Ziwani, Makonde Escarpment, Mbangala Forest in Masasi and Nanyumbu
that has about 28,490 hkt. along Ruvuma River Prior to TFS forests were under LGAs that proved to
be too weak and lead to destruction of large stretches of forests. It should be borne in mind that
hard wood rejuvenates in more than 40 years.
To protect over harvesting and illegal logging, the
government increased the loyalty paid commensurate to
timber market prizes. It also established minimum sizes of
logs to be harvested of 30cm diameter. The royalty rates
are as show in Table 6.1.
These rates have discouraged many timber traders and
when trees are relatively at increasable locations the cost of
delivering timber in towns becomes less profitable.
Table 6.1: TFS Royalty Rates on Timber
Timber Class
IA
IB
II
III
IV
Source: TFS - Lindi
TZS per M3
230,400
204,800
153,600
115,200
76,800
Some timber dealers interviewed at Mtwara said they had
stopped dealing with hardwood timber because it is capital intensive and does have far less margins.
Another reason had been the slow pace at which the timber is sold. There has been improvements in
law enforcement along timber routes. On average the forest gate price is between TZS 400,000 and
TZS 500,000 per M3. Two timber traders interviewed in Mtwara stated that construction activities
going on at Dangote have not triggered demand for hard wood but instead there is more demand
for softwood. Construction activities are partly responsible for the depletion of the land (plantation0
forest. Much of the softwood timber found in Lindi and Mtwara come from Iringa Sao Hill Forest.
Chinese and other construction companies prefer to travel to Dar es Salaam to buy the timber
because there they are assured of quality and ability to negotiated prices. Major buyers and users
for hard wood are contractors involved in construction of government funded buildings such as
schools, dispensaries, etc which have to adhere to certain “old” standards. However there is a
growing trend even in some government buildings where there is substitution of timber with other
materials.
57
One leading contractor in Mtwara who indicated to have just finished staff houses for the
government, narrates that demand for hard wood had declined significantly. For a typical 120m2
(built up area) house requires about 4.88m3 that cost between TZS 2.5 to 3.0 million worth of
softwood.
The TFS Southern Zone and Masasi Rural District Council
Tanzania Forest Service’s with its Southern Zone Headquarters at Masasi Township was established
in 2010 and started operations in 2013. The Zone covers the Regions of Ruvuma, Mtwara and Lindi.
There are two forest management systems in Tanzania, those under the management of Central
Government and those under Local Government. At District level, the TFS’s District Forest Manager
(DFM) reports to TFS Zonal Office Directly while the District Forest Officer (DFO)is under District
Executive Director and answerable to the Land and Natural Resources division in the District. TFS’s
DFM major duties include:•
•
•
Inspection of forest products which are to be harvested
Inspection of timber which is already harvested and issuance of timber selling permits
Enforcement of forestry laws which involve inspecting illegal forestry products, (timber, logs,
charcoal, etc.) and where they have been obtained illegally, DFM has the duty to seize, impose
and collect fines as well issuing permits for sale of seized products..
• Processing of licenses.
According to TFS, most timber is sold for use in Dar es Salaam and Nairobi and to small extent
Mtwara and Lindi.
A buyer has to pay TZS 361,000 for Certificate of registration which is valid for one year, of the
amount TZS. 261,000 goes to the Central Government, while the remaining TZS. 100,000 go to the
Local Government. Royalty Fee for Class “A” timber includes Teak and Mpingo the royalty is TZS
230, 400 per cubic meter, 5% from this amount is charged as a Cess and is sent to the District
Council. First Class “B” timber includes Mkongo, Mninga and Mpande rated at TZS 204,800 per cubic
meter, cess is 5% of this amount. Second Class, with the most demanded timber Mbalamwezi,
Msaula, Mfudo, Msisim, and Mzambarau. From this type of timber, a buyer should pay TZS.156,600
per cubic meter. Third Class is mainly the Msufi pori that is lighter and used in place of soft wood
from plantation forests. These are charged TZS 115,200 per cubic meter. The cost of Processing of
timber: The first “A” class timber is charged at TZS. 16,000 at farm gate price , while first “B” class
timber is charged at Tzs.13,000. Transit Pass: Is based on truck size, TZS 6,500 for a truck of less than
7 mt while trucks above 7Mt are charged 13,000.
In Masasi Town Council there are three main forest in the Municipality of Masasi:
Chikoweti general land forest is owned by the surrounding Communities including Chikoweti,
Namatutwe, Namajani, Nanyindwa, and Mkwapa villages in Namajani, Namatutwe and Lukuledi
wards, within Lisekese Division. The forest has been harvested by saw millers and pit sawyers;
species preferred are Afzelia quanzensis, Milletia stulhmanii, Dalbergia melanoxylon and.
Mkangaula.
Lichehe general land forest is bordered by Utimbe, Luatala, Lichehe Nangomwa, Maparawe and
Sindano villages in Sindano, Mchauru and Lipumburu wards, within Chiungutwa and Mchauru
58
divisions. The forest has been harvested by saw millers and pit sawyers. Species preferred are Afzelia
quanzensis, Dalbelgia melanoxylon and Milletia stulhmanii.
Msikisi general land forest is surrounded by Namalembo, Miwale, Nangaramo and Msikisi villages in
Namajani, Mkangaula, Nangomba and Namatutwe wards within Lisekese division. The forest has
been harvested by saw millers and pit Table 6.2: Revenue sources for Masasi Rural District.
sawyers. Species preferred are Afzelia
Products
Quantity
Unit Value in TZS
quanzensis, Milletia stulhmanii and
3
Timber ( Per M )
691.12
M3 118,240,253
Dalbergia melanoxylon. Mkangaula
Timber (Per Piece)
3,500
Pcs
24,000,000
Reforestation Efforts: About 10ha have
Furniture
1,877
Pcs
12,355,700
been set for establishment of nurseries
Baskets/Fibers/
6,892
Kgs
4,899,250
of indigenous and exotic trees. About
Winnower (Ungo)
62
Kgs
62,000
26,750 seedlings of pine have been
Carvings
1,195
Kgs
119,500
planted and is to be distributed to
Bee Honey
174
921,000
communities including schools. The
Transit Pass
21
112,500
trees may attain harvestable size after
Application Fee
18
3,408,000
20 years.
For Registration
The opening of the Mkapa Bridge over
Registration Fees
15
11,900,000
3
the River Rufiji in 2003 was a pre-dawn
Compounding
6
M
29,000
of the increasing economic activities in
Fees
Lindi and Mtwara.
The recent
Total
176,047,203
discoveries of natural gas in Lindi and
Mtwara the growing interest on the
two regions which then have created an uprising of investment and business opportunities. This in
turn has initiated (albeit slow) an inflow of human population to the two regions and specifically the
urban areas (i.e. Lindi and Mtwara towns and some district headquarters). The Country’s National
Census 2012 place the population in Mtwara region at 1,270,854 and Lindi region at 864,652. As the
population grows so are some of the main requirements for their settlement, the main needs of the
human population on forestry products. The needs can be categorized as others;
• Construction of residential houses,
• Construction of commercial buildings, and
• Furniture both for commercial and residential housings,
• Commercial logging supply timber for construction and furniture industries.
In the past the high demand of timber as building materials put considerable pressure on natural
forests, especially those near urban areas and villages. However, in recent years, some
developments in the technology areas and the fast depletion of natural hard wood had either
provided or necessitated people to seek other options on construction and furniture materials.
- The illegal logging activities have caused an unprecedented fast depletion of natural forestry
trees. This in turn has caused a reduced availability of hard wood hence raising prices to
prohibitive levels.
- The technological inventions have also developed substitute materials for construction and
furniture.
- There has also been an introduction of plantation forestry where soft wood is made available for
both construction and furniture.
59
Therefore the prohibitive prices of hard wood, the availability of alternate materials for construction
and furniture and the introduction of soft wood reduce demand of hard woods obtained from
natural forestry. The real need for hard wood has shifted to export business to other regions
specifically Dar es Salaam and even abroad where there is still demand for hard woods.
For the sake of this study, of major interest are the urban areas as the economic activities bring
more impact and create urban migration from rural areas, therefore direct and immediate impact
will be observed and felt quicker in urban and peri-urban areas. To estimate the volume of timber
consumption by all the three groups mentioned above may not be easy, it is however possible to try
to estimate the volume demanded by households specifically in construction and furniture.
The hardwood extracted from the EAM is mainly turned into furniture. The total annual benefits of
hardwood extraction from the EAM that accrue to the final beneficiaries can therefore be
approximated by assessing the annual timber consumption per household and the value of that
timber, taking into account that the latter varies across species. To estimate annual household
demand for hardwood, we assumed that timber use is a function of location (urban/rural), income
stratum, and furniture ownership per household. Household census data was available for furniture
ownership (NBS 2009) and was combined with assumptions about furniture items for which these
statistics were unavailable. Statistics on income strata across regions was available from NBS (2011).
We assumed that richer households have more purchasing power and therefore own more furniture
and bigger houses. Carpenters stated that most of their customers were middle and high income
households, justifying this assumption. Carpenters produce household furniture, including tables,
chairs, doors, doorframes and beds, and provided information about the timber volume of these
items. Per household estimates vary between 0.0367 and 0.0515m3 per year for rural and Dar es
Salaam residents respectively, assuming a lifetime of 25 years, comparable with published estimates
in Wells and Wall (2005).
Table 6.3: Estimated demand for hardwood in Lindi and Mtwara Municipals
2012
Mtwara Municipal
Low Income
75%
Middle Income
20%
High Income
5%
Total
Increase in # of Households
Demand/m3
0.0515
Lindi
Low Income
78%
Middle Income
18%
High Income
4%
Total
Increase in # of Households
Demand/m3
0.0515
Source: Consultants computations
19,950
5,700
2,850
28,500
14,916
4,688
1,705
21,308
2015
2020
2025
22,549
6,443
3,221
32,213
3,713
191
28,262
8,075
4,037
40,374
8,161
420
35,557
10,159
5,080
50,796
10,422
537
16,537
5,197
1,890
23,625
2,317
119
19,641
6,173
2,245
28,059
4,434
228
25,068
7,878
2,865
35,811
7,752
399
Total Over
10 years
22,296
1,148
14,503
747
60
Based on projected population growths in Lindi and Mtwara and using the 0.0515m3 consumption
rate per household, it is noted that between 2012 and 2015 about 3,713 buildings were required to
maintain the index for the number of people per households of 3.8 for Mtwara. Between 2015 and
2020 Mtwara requires additional 8,161 units and between 2020 and 2025 it shall require more than
10,000 units. Assuming the consumption above is maintained, demand for hardwood timber for
furniture will be around 200m3 between 2012 and 2015, 420m3 between 2015 and 2020 and 531m3
between 2020 and 2025.
Lindi demand will be around 119m3 between 2012 and 2015, 228m3 between 2015 and 2020 and
for 2020 to 2025 it will be 399m3. One practical strategy to reduce pressure on natural forests is to
popularize light weight furniture among the populace.
On the other hand, TFS efforts on tree replanting requires serious attention, it is important to step
resources and promotional campaign to regenerate these preferred indigenous species in and
outside the forest reserves.
61
7.0 CONCLUSIONS AND RECOMMENDATIONS
7.1
Conclusions
7.1.1 The Gas Industry has the potential to catapult the economy of Lindi and
Mtwara
Tanzania is poised for a quantum leap towards a gas-dependent economy, the confirmed discoveries
of about 46TCF is quite significant and exploration has just started with many blocks yet to be
appraised. It is estimated that exploration will continue for about 20 years to come. Construction of
LNG plant is key to the growth of the sector as it will allow exportation of the gas principally towards
Asia. The highest impact to the economy may be felt during the LNG plant construction where it is
estimated that between 10,000 and 16,000 will be engaged and part of the approximately 10bil USD
in investment will pay for local goods and services. Industry experts mention one important success
factors for the gas industry to flourish, political and social stability. Another avenue for local
participation is the contracting of rural communities along the gas pipeline to provide security
services. TPDC is working with the communities to install systems and protocols for securing the pipe
which is expected to be completed the first half of 2015 26.
7.1.2 Employment and Income Impact
Market opportunities for agricultural products in Lindi and Mtwara hinge on population growth
particularly in urban areas and the population that has higher disposable income. Signs of
strengthening of the economies of Lindi and Mtwara are evident from around 2010 when the GDP
per capital started growing at a higher pace than the national rate, by 2012 Mtwara GDP per capita
had just crossed the national average while that of Lindi was lagging behind but narrowing the gap.
The increase in the number of salaried workers projected around 25,000 directly and indirectly
related to gas offers great opportunity for agro-businesses.
7.1.3 Policies and Legal Frameworks are in place
The country has promulgated policies related to gas based on world-wide good practices, Trinidad
and Tobago was selected as a model country, and the World Bank suggests Ghana to be among the
best African countries in terms of policies towards oil and gas. A rapid review of the contracts
related to gas industry shows that most of the conditions obtained in Tanzania are comparable to
conditions in Kenya (Oil), Uganda (Oil) and Mozambique (Gas). There is every indication that
investors are at least in agreement with regard to the policy and legal frameworks.
7.1.4 Lindi and Mtwara Profiles show that the regions have to work harder
Agriculture: Lindi and Mtwara have for quite a long time been perceived as the forgotten part of
Tanzania, however, a review of statistics shows that Mtwara lies in the middle of most indicators
26
By December 2014 the construction of the pipeline was 90% complete.
62
including food security and average GDP per capita. The major cash crops are limited though to
cashew and sesame. Cashew marketing is highly politicized, lack of proper management systems and
committed farmers particularly at primary cooperative societies levels have plagued the widely
supported warehouse receipt system. Cashew has continued to be the crop of choice for cash
earning to many smallholder farmers. Lindi and Mtwara are famous for sesame production, the two
crops are virtually destined for export and therefore very susceptible to global market turbulences.
There is very limited processing capacity in the country as well as Lindi and Mtwara. The warehouse
receipt system while it has helped farmers to improve prices, it has squeezed margins for processors.
Major food crops are cassava, sorghum, rice and maize. In the last (2013/2014) season the regions
had positive food self sufficiency ratios. There had been initiatives to commercialize cassava
processing in Lindi and Mtwara to extend its usefulness beyond household subsistence source of
food. None of the efforts have attracted serious private investment.
7.1.5 Skilled Labour Supply may become a constraint for Lindi and Mtwara
The 2012 Census showed that Mtwara and Lindi were among the regions with the lowest population
growths which impacted on the overall population increase. Limited opportunities for youths in Lindi
and Mtwara and proximity to Dar es Salaam have lead to significant emigration of youths. The
Municipals of Mtwara and Lindi are bound to increase and expand due to opportunities brought
about by gas and its spillover firms and therefore the middle and higher income groups may raise
faster than low income increasing spending power on food. This likely to reverse the current
negative net population migration.
One of the main weaknesses of Mtwara and Lindi has been shortage of manpower because of lack of
opportunities for educated population. To brace for participation in the gas economy Mtwara VETA
has been mandated to offer courses that will enhance employability of the local population when
investments increase. The response from within Mtwara is noted to be still low and more effort is
needed to attract youths. The two regions have prioritized education in their development agenda.
Mtwara City Master Plan: The City of Mtwara is under design to meet minimum standards for a
greener city, this will lower investment costs for potential investors. The plan is scheduled to be
completed first half of 2015. The main constraint to the expansion has been compensation for crops
that is relatively high.
7.1.6 Demand for Food in Mtwara and Lindi Municipals is Higher than its
hinterland can supply
Market Segments: The major market segments for agricultural produce are: a.) local consumers,
these form the largest and durable market base. This segment has a narrow band of products, does
not care much about quality and is mainly price sensitive. b.) The Chinese consumers these are
currently around 1,000 but offer an important bridging market between high end, quality conscious
segment and the local consumers. The Chinese are less strict on quality but hard on bargaining price.
Their menu is longer than local consumer but less than that of non-Chinese expatriates. c.) The third
segment is made up of non-Chinese expatriates (largely of Caucasian origin). This segment is
63
relatively small and irregular at present, it will become more important as gas processing plants are
commissioned and most important when the LNG plant is being constructed and operated.
The LNG plant will offer a unique opportunity in agri-business as demand for food will increase
significantly to meet the requirement of more than 10,000 people at the site. To be able to tap into
this market some work will need to be done in areas of organization of production, supply chain and
especially the cold chain, hygiene and application of proper agro-chemicals and business
management in general.
Horticultural Products: Growth in the market for horticultural products is driven by people from
outside Mtwara, most long term residents have shown that consumption of “exotic” horticultural
products is relatively new in the Lindi urban towns. It is therefore true that growth of population for
these major towns will equally drive the market for fresh produce and consequently production.
There is strong evidence that farmers in Lindi/Mtwara are responding to market signals, although at
a slower pace as noted that Kitere basin has become the hub of horticulture for the emerging
market.
Irregular pattern in the number of expatriates that form the basis for “high value” vegetables that
are exclusively for foreigners in gas industry dampens the market signals for these products. It
should be borne in mind that Arusha and Dar es Salaam offers better services because the products
are not produced exclusively for expatriates but expatriates find the products at the markets, this
arrangement reduces the risk of both sides. Drawing from the above, LIMAS and other Projects
targeting expatriates market should view this market as an extension of the existing local population
market.
The impact of gas to the economy of Tanzania is a gradual one and will take years to be felt since the
investment required for exploration, investment in drilling, extraction and processing is quite a long
and iterative one and takes many years.
7.1.7 Sources of Foodstuffs Outside Lindi and Mtwara regions will continue to play
significant role.
A range of products from Mtwara and Lindi shall continue to displace other sources but at an organic
pace because market signals are not yet strong and or the conditions especially rainfall and
temperature does not favour the type of crops. This will be the case for temperate fruits and
vegetables unless advanced technologies are used for example green houses. In this case investors
operating in other parts of the country can be encouraged to invest in Lindi and Mtwara because
they have the technology. It is very likely that the situation shall be the same for cattle.
7.1.8 There will be minimum impact on Forest Resources from development
Despite that it was not core to the study, this assessment has shown that there is a downward trend
in the use of hardwood in construction because it has become too expensive after restrictions and
imposition of higher tariffs as compared to cheaper non-wood materials that are also becoming
trendy. The main use of hardwood in the local market will be on furniture. At the estimated growth
rates there will be 27,000 new residential buildings in Lindi and Mtwara Municipals that will use
about 2,000m3 up to 2025. The biggest challenge on forestry resources is illegal logging for selling to
64
Dares Salaam and outside the country. Efforts by TFS and organizations like LIMAS should be
supported to reverse the rapid deforestation.
7.2
Recommendations
7.2.1 Fresh Vegetables for Growing Lindi and Mtwara Market
It has been established that Lindi and Mtwara are increasingly producing vegetables to feed the local
market in and around April through July. There is gross shortage post – July because of drought in
major vegetable growing areas and between December and April because there is too much rainfall
that affects production in two ways: i) Most plants’ diseases flourish during wet season, it is usually very expensive to prevent and
treat crops unless the anticipated prices appreciate high enough to cover for incremental cost.
ii) Most rural roads become impassable, increased transport costs renders the business not
profitable. One reason that Kitere has managed to develop its horticulture (albeit at the stage
it is), is accessibility by road throughout the year and transport costs to Mtwara is the same
throughout the year.
To improve availability of locally produced vegetables with a vision of upgrading the supply chains in
terms of quality, delivery consistency and competitive prices to meet the upper market
requirements, it will be worthwhile to start with commodities that they currently produce for local
market. The produce that are widely available, albeit seasonally are tomatoes, eggplants, green
pepper, African eggplant, cucumber, mchicha (amaranthus), Chinese cabbage, okra, Swiss chard, red
pepper, carrots, watermelons, etc.
Currently, due to low demand in major towns, fruits and vegetables have not attracted commercial
investments say in irrigation despite existence of potential irrigable areas that can produce
vegetables throughout the year. Market operators and long serving civil servant confess that most
vegetables found in the market today are alien to local population and have been on increase
following the growth of urban population that include people from other regions. One youth who
hails from Mikindani and earn leaving as a motor bike (bodaboda) operator emphatically noted that
It is difficult to tell me to cultivate products that we have never eaten nor is its market well known. I once
tested chewing carrots, I found nothing interesting in it. I never eat carrots, so are other strange
vegetables.
On the other hand, the Lindi Regional Government has received request for more than 4,000ha of
land to develop horticulture from Kenyan investors. The investors invited an entourage from Lindi to
Kenya where they have technology-driven horticulture sector for export markets. The fact that
Kenyan investors have mature export markets, systems and knowledge base and business models,
this minimizes the risk and increase chances for success. However, land laws makes it difficult to
access such vast land since much of the seemingly unused land is under the custody of village
Government and an investor has to negotiate with each village separately. For LIMAS to develop the
supply chains it has to work more from the end markets and organizing and coordinating
interventions.
At the end markets, LIMAS should support traders who sell better quality products referred to as
fresh vegetable kiosk operators as well as WABISOCO. Assist these outlets with: - Skills on fresh produce stock management
- Visibility to companies that provide catering services
65
-
Education on costing, pricing, quality controls etc.
Link the traders with Lindi and Mtwara based suppliers, here it has to be noted that, this is a
gradual process with associated costs, learning by doing and mistakes so as to build trust. Also
the major binding force is usually promise of a better than market price. Unless final buyers
consumer are willing to pay more than the market and the trader shares the additional income
with farmers, contract supply is difficult to sustain. LIMAS should invest in knowledge
management and sharing system that will help to build trust. Further it has to be remembered
that Dar es Salaam offers the most challenging competition for products that are widely
consumed. Support to farmers should include understanding how the competition is in the
fruits and vegetables market.
7.2.2 Fish Industry
7.2.2.1 Sea Fish
Despite that Lindi and Mtwara have an extensive sea shore, there is limited capacity to undertake
commercial deep sea fishing for lack of technology, i.e. the type of vessels needed to fish in high
seas. Consequently the contribution of fish to the local economy and nutrition is decreasing, to make
ends meet fishermen often resort to fishing using illegal means especially explosives that destroy
coral reeves.
In 2009 MACEMP Programme supported some 9 villages with fishing gear and more powerful vessels
with 5mt cargo capacity to tap into the growing fish market at Kilwa. Six boats are operating and 2
groups have added more boats from their earnings operations 27. It may be of interest to confirm the
findings that fishing groups have managed to run their businesses profitably so as to scale up the
kind of support in consideration of the likely growth in demand for fish in the two regions.
On the demand side, there is growing preference for fish protein over red meat and this is reflected
in the price of fish which is relatively high at around TZS 5,000 per Kg within Mtwara and Lindi
Municipals. Fish consumed by upper market consumers is imported frozen fish and sometime is
from Lake Victoria. When the LNG plant is under construction there will be more demand for fish
which offers a good market opportunity for locally sourced fish.
It is recommended that LIMAS prepare an investment opportunity dossier for fishing businesses to
be marketed for medium scale investors that target the growing market in Lindi and Mtwara.
7.2.2.2 Mari culture
At national level, much of the country relies on fish from Lake Victoria (Tilapia and Nile Perch) and
imports of farmed fish from China, based on International Trade Centre Trade Database importation
of various fish products was close to 6,000MT in 2013. Lindi in particular introduced mariculture in
2008 during MACEMP Programme. An assessment of water tides, water quality, fingerlings collection
and fish holding capacity was done. Tilapia of Chanus chanus type or Mwatiko in Kiswahili has been
found to flourish well under controlled ponds. The fish is observed to grow to about 600 –
700grammes in 6 months 28 and a Kilo sells in town at TZS 6,000/=. The recommended number of fish
27
More information is needed to confirm on the groups ability to scale up operation as this may be a strong
proof of business viability
28
This figure needs to be confirmed as experience from other fresh water ponds disputes it as being
exaggerated.
66
per m3 is 5 – 6, assuming a mortality rate of 20% the population is around 4 – 5 fish per m3, a typical
pond will be 400 m3 hence a potential of 1,600 to 2,000 pieces. This will bring revenue of between
TZS 8 million assuming low price, low population and low weight gain and 11 million on best
scenario. The cost of production can hardly exceed TZS 3million.
The Municipal Fisheries office has identified the area stretching from Mbanja to Mkwaya (that
includes Nundi and Mingoyo) to be suitable for mariculture. The soils in these areas have high water
retention capacity and are currently under salt extraction. Already some investors in are turning into
mariculture, the leading investor has converted 13 ponds into fish ponds and there are indications
that he is looking for possible Chinese partners to scale up mariculture.
This business faces two main constraints, one is limited access to suitable areas as the land is owned
by the Ministry of Energy and Minerals, secondly are presence of predator fish in Kiswahili called
Mambo, it is difficult to separate at the time of collecting the fingerlings in the ocean. Given the
knowledge that NIRAS (the LIMAS implementing company) has in marine and estuarine of Lindi and
Mtwara gained during the implementation of MACEMP, mariculture can be a quick win project with
promising impact on employment, income and nutrition for the population of Lindi and Mtwara.
Table 7.1 : Gross Profitability Estimate for Mari culture
Fish density/Fingerlings/cub. metre
Mortality rate in %
Loss due to predators in %
Net fish available for harvesting/cubic metre
Average weight in Kgs after 6 - 8 months
Average pond size in sq. meters (20m X 20 m)
Number of harvestable fish
Average price (wholesale) per Kg
Kgs harvested
Revenue at wholesale
Cost of maintaining the pond
Possible surplus before tax
Margin
20%
20%
Worse
Scenario
5
1
1
3
0.6
Average
Scenario
6
1.2
1.2
3.6
0.7
1,200
5,000
720
3,600,000
2,000,000
1,600,000
44%
1,440
5,000
1,008
5,040,000
2,000,000
3,040,000
60%
400
7.2.3 Livestock Production
It has been noted that livestock products (beef, pork, chicken beef, eggs and fish) take significant
(more than 70%) value of the consumers budget as against about 15% for green vegetables.
Cattle: However, the area surrounding Mtwara has limited space for beef and or dairy cattle
ranches. More survey needs to be done to establish performance of cattle in the area. Since much of
Mtwara and Lindi have uni-modal rainfall pattern investment in cattle will require large amount of
initial capital. It is feasible and less demanding to invest in fattening lots where cattle from other
parts of the country may be fattened until they reach the recommended age and quality. LIMAS has
funded a feasibility/business plan for an up-country investor to add value through fattening of
cattle bought from other parts of the country.
67
Poultry: There is space for Mtwara to have a burgeoning poultry industry, the major constrain
however is the diseconomies of scale because it lacks local sources of raw materials animal feed
production. The raw materials are bulky and so far there are no established sources that promise
economic advantages. Dar es Salaam may continue to be the source of cheaper poultry products
because of easy access to grains, reliable water supply, and market options. Development of large
scale poultry industry may require a feasibility study for an integrated value chain, integrating
production of main raw materials. One option being explored in a study by LIMAS is utilization of
soya in place of sardines as source of protein and sunflower seed cake from local oil millers to
reduce the cost of raw materials.
7.2.4 Tropical fruits production
7.2.4.1 Fruits Production
Lindi and Mtwara can produce a number of tropical fruits designated for the domestic industrial
processing, upper market and export, the fruits include mangoes, pineapples, lemons, passions,
guava, banana, lemon, tangarines, etc. The Regions can start with pineapple and mangoes as an
extension of a programme currently initiated by IFAD funded programme MUVI, (www.muvi.com)
that covered those crops in the districts of Mkuranga, Bagamayo in Coast Region that have similar
geo-climatic conditions with as much of Lindi and Mtwara. The presence of Association of Mango
Growers (AMAGRO) with some experience and networks in the development of the commodity can
be a good catalyst to the development of such sectors. AMAGRO has indicated existence of good
domestic and export markets for fresh mangoes provided quality is assured. Mohamed Enterprise
and Azam who process fruits en masse travel all the way to Mtwara to collect mangoes during flush
period. It has been indicated that if the two companies were not there, more than 90% of mangoes
are wasted 29. For traditional fruits, the buyers pay TZS 20 – 30 per fruit, while on the other hand,
improved varieties in Mkuranga and Rufiji fetch a minimum of TZS 300 at farm gate. Naliendele
Agriculture Research Institute (NARI) has already worked with AMAGRO to setup 10 nurseries for
mangoes.
7.2.4.2 Fruits Processing
As noted above the regional has potential to produce mangoes and pineapples that that can be
processed into pulp for export or juice making in the domestic market, according to a Danish organic
agriculture expert many parts of the country can develop mango and pineapple orchards for
production of organic pulp. Uganda exports significant amount organic mango pulp to EU market 30.
Internet search show that mango pulp extraction is a profitable business, the analysis based in India
for 2Mt per hour, operating at 16hrs/day, 160 days per annum gives an Internal rate of return of
51%.
One potential local investor has a plan to invest in fruit processing plant in Mtwara. He has identified
some 26 acres some 20 Kms along Mtwara – Lindi highway, he plans to travel to China to seek
information on technology in 2015.
29
Interview at Mpapura Village residents
According to discussions that the author had with National Organic Agriculture Movement of Uganda
(NOGAMU)
30
68
7.2.4.3 Dried Fruits
Some literature indicate that there had been projects/programmes promoting solar dried fruits in
Tanzania including; Matunda Mama Tanzania Ltd in Karagwe (Kagera), KNFC in Kilimanjaro, Solar
Tunda at Sokoine University under the support of DANIDA, etc. While Tanzania may have a better
comparative advantage over Uganda due to higher insolation hours in Tanzania, on average Uganda
exported 56.8Mt per annum between 2009 and 2013 worth an annual average of USD 258,000 (a
peak was reached in 2011 when USD 593,000 was earned from 144Mt of exports.
7.2.5 Cassava Flour to blend with Wheat for bakeries and Starch Production for
Export
A large percentage of Tanzania population depend on cassava as the main source of calories, the
crop is very common in the Coastal Zone due to its versatility including tolerance to drought
conditions, low cost of inputs, potential high yield per unit of land compared to other commodities
and storability of dried peeled cassava, many organizations concerned with food security have been
promoting Cassava production in Tanzania and recently, value addition. Programmes and funders of
cassava initiatives include:• CAVA had worked to link small processor groups with Assam and other large bakeries but low
grit volumes compared to minimum requirements, lack of grits in the rain season due to poor
sun drying, difficulties in pooling produce from several groups and little business understanding
within the groups made the initiative less successful. Cassava flour/grits are used by the bakeries
as a substitute for wheat flour, max 10%. In times with high wheat prices the bakeries are asking
for cassava and vice versa.
• FAO that was active in Mtwara, Lindi and Pwani/Coast Region for two years, 2010 – 2012.
• VECO in Pwani/Coast region between 2008 and 2013.
• Plan Tanzania in Pwani/Coast, Mwanza and Morogoro is ongoing from 2011 up to 2015.
• IFAD under Muunganisho Ujasiriamali Vijijini (MUVI) in Mwanza, Ruvuma and Pwani/Coast
between 2010 and 2014,
• Concern World Wide in Mtwara, Kigoma and Iringa from 2010 to 2013.
An expert at Naliendele Agriculture Research Institute (NARI) contends that looking at the
population growth, Tanzania needs to prioritize cassava as a very strategic crop for food security.
The crop has a potential to produce up to 20Mt – 25Mt per hectare (about 8 – 10Mt/acre) of fresh
cassava. Assuming a weight conversion ratio of 100:30 for wet to dry the yields above translate to
2.4 – 3.6Mt of dry cassava flour per hectare. In West Africa cassava is an important staple food crop,
recently Nigeria is devising a law that will require main bakeries to blend imported wheat flour with
at least 10 percent of cassava flour. It is worth to mention some developments related to cassava:•
Cassava flour has started to regain popularity even in urban areas and particularly in restaurants
that serve traditional menu, one development officer working with MUVI in Pwani/Coast
confirmed availability of a good market for cassava flour provided the quality is guaranteed. A
kilogram of cassava flour retails at TZS 800 at farm gate and retails at TZS 1,500 in supermarkets.
Low quality flour at Tandale sells at TZS 700 – 800.
69
•
•
Scalability of processing technology helps the processing (grating or chipping) to take place even
in rural areas as cassava is fresh cassava is
Table 7.2: Profitability of a 4Mt/day Starch
bulky making transport to distant processing
Plant
point less attractive.
Percent
The Government is working in partnership
Net estimated annual profits
with development partners to support private
Profits per invested capital
14.8
millers to improve the value of flour through
Profits per operating cost
19.2
fortification with Vitamin A and other
Profits per working capital
76.8
important elements such as zinc, folic acid,
Source: http://www.fao.org/docrep /x5032e/
iron, etc. Promotion of cassava flour in the
x5032E05.htm
domestic market can help improve nutritional
status, Food fortification is coordinated by Hellen Keller International.
Sample analysis at FAO website shows that a cassava starch processing plant that produces 4mt/day
will require 31,300Mt of fresh cassava that can be produced in 3,100acres at a yield of 10Mt per
acre.
Export potential is another opportunity, consultations at the Port of Mtwara show that the region
had in the early to mid 1990s exported dry cassava to India, Japan and Iran, the study failed to
conclude why the business stopped but the source of information suggests that it was changes in
global market. The expansion of Mtwara port will lower sea freight, it can be shipped as a returncargo to ships that will be delivering cargo for the population in gas and spillover industries. The only
challenges that need to be addressed are mainly getting the technologies for drying and storing the
crop before shipment and getting commercial volumes.
7.2.6 Value Addition to Sesame for Export Market
Lindi and Mtwara are famous for production of sesame in Tanzania, NDC plans to allocate land for a
large sesame farm in Lindi. The market for sesame has been attractive in both domestic and export
markets. Centre for Promotion of Imports from Developing Countries (CBI) at the Ministry of Foreign
Affairs of the Government of the Netherlands, show that sesame has recently gained high popularity
in EU. And between 2002 and 2007 demand in Europe increased by 27%, the increase slowed
between 2007 and 2012 EU Imports some sesame from East Africa mainly Sudan and Ethiopia that
produce sweet sesame suitable for making halva and tahini.
At present the bulk of sesame from Tanzania goes to India, which may be re-exported to European
Union (EU). Import into EU market in 2012 was Euro 136 million from 106,225mt. Price for hulled
sesame increased to Euro 2,000 – 2,800/mt. However, price appreciated over this period and by
2012 it was almost 3times higher compared to 2002. In response to improving markets West African
countries have increased their share in the EU Market. In order to successfully access the European
market it may be necessary to review the varieties that command better price and good agriculture
practices. Much of the sesame produced in Tanzania is non-white while more profitable European
market is for white confectionary varieties. Another important aspect may be the efficiency of
supply chain as sesame is difficult to store over a longer period due to pests which can only become
worse after hulling.
70
7.2.7 Value Addition to Pulses for Export Market
Lindi and Mtwara regions are, and have the potential to increase production of pulses for export
markets. Data from RAS shows that in 2013 Lindi produced more than 75,000Mt of pulses. According
to a study by LIMAS (2012) 31 about 90% of pulses grown are marketed hence the amount pulses
marketed will be around 65,000Mt in the region. At present the pulses are marketed and exported
mainly to India in raw form. Mohamed Enterprise Limited has established a plant in Dar es Salaam
with a 32Mt per for cleaning, splitting and de-husking pulses. Assuming a 300 working day-year, the
plant can just process 9,000Mt. A similar plant in Mtwara/Lindi will hardly absorb 12% of the
production reported in the region. The advantages for such a plant in Mtwara are many fold:•
•
Sources of raw materials will be within the corridor.
Presence of programmes like Agha Khan, LIMAS and Africare that can participate in supporting
initial technical support at farm level.
• Reliable energy supply from both electricity and where necessary natural gas.
• Land/plot for industrial activities are readily available.
The technology for value addition (daal production) is readily available.
______
31
Structured Trade And Consultancy Limited/LIMAS. 2012. Assessment Of Domestic Value Chains For Pulses
71
REFERENCES
Giacomo Luciani. Gulf Research Centre 2010 (In Integrating upstream and downstream of oil and
gas. Gulf Research Centre Foundation. Geneva
Kilcher Consultancy Limited. July 2012. Feasibility study for a pilot rural commodity assembly market
in Mtwara and Lindi regions.
Lindi RAS,2014. Investment Opportunities Existing in Lindi Region
LUKOIL, Global Trends in Oil and Gas Markets to 2025
Massachusetts Institute of Technology. 2011. The Future of Natural Gas.
Ministry of Energy and Minerals. 2014. Local Content Policy of Tanzania for Oil and Gas Industry
2014 Budget Speech.
Ministry of Energy and Minerals. 2014/15 Budget Speech.
MRA- Management Associates. 2013. Draft Business Plan for the Establishment of a Green Grocery
Store in Mtwara
Structured Trade And Consultancy Limited/LIMAS. 2012. Assessment Of Domestic Value Chains For
Pulses
USAID/Chemonics International Inc. Staple Foods Value Chain Analysis Country Report TANZANIA6/1/2010
Wise, Holly and Sokol Shytlla. 2007. The Role of the Extractive Sector in Expanding Economic
Opportunity. Harvard University.
72
ANNEX I: OIL AND GAS EXPLORATION BLOCKS AND RESPECTIVE
COMPANIES
73
ANNEX II : OIL AND GAS EXPLORATION COMPANIES OPERATING IN
TANZANIA
OPERATOR
CONTACT PERSON
AREA/BLOCK
Pan
Energy
David K. Roberts:
Oyster Plaza Building, 5th Floor
Ohio Street, P. O. Box 80139 . 99999Dar es Salaam
Tel. + 255 (0) 22 2138 737, Fax: + 255 (0) 22 2138 938
Email: [email protected]
Songo
Songo
Development
Mr. Christopher Ford
The Managing Director
4th Floor, Plot No. 179/180
Msasani Bay, Msasani Village Block "B"
Kinondoni District. P.O.Box 6342, Dar es Salaam
Tel: +255222124181, Fax: +255222124186
Christophe Maitre
Country Manager
Maurel et Prom (T) Ltd.
1124 Chole Road, Msasani peninsular, Dar es Salaam
Tel: +255 22 260 214, +255 782 444 352
Email: [email protected]
Thierry Murcia:
Country Manager
Kenyatta Drive Plot 5.15, Oysterbay
P.O. Box 179, Dar es Salaam
Tel. +255 784 600674, Fax: +255 22 266 7284
Email: [email protected]
Mr Imtaz Kassam
Petrodel Resources Ltd C/o MM Industries,
ITV Road, P.O. Box 3030. Dar es Salaam, Tanzania
Email: [email protected]
Jeremy Martin
Country Manager
East Africa Exploration (Kenya Ltd)
P.O.Box 38925-00623. Nairobi, Kenya
Mob: +254 (0) 72 9943249
Email: [email protected]
Mr. Derek Hudson
President and Asset General Manager � BG East Africa
BG International, Tanzania Branch
Plot 369, 1st Floor Kilwa House . Toure Drive, Oysterbay
P. O. Box 105833. Dar es salaam
E-mail:[email protected]
Mr. Bjorn Albert Holbaek Rasmussen
Country Manager
Statoil Tanzania As
79 Haile Sellasie Rd . Oysterbay, P.O.Box 713. Dar es Salaam,
Tel: +255 767 303677
Email: [email protected]
Songo Songo Gas Pipeline
Manoel Murilo Silva
Managing Director
Petrobras Tanzania Ltd
Plot 1403/1A Msasani Peninsula
P.O. Box 31391 Dar Es Salaam - Tanzania
Tel: +255 22 2165604. Mob: +255 (0)786188732
Email: [email protected]
DeepSea Block-6
DeepSea Block-8
African
Songas Limited
Maurel & Prom
Ndovu/Aminex
Petrodel
Afren Tanzania
BG
International
Statoil
Mobile
/Exxon
Petrobras
Gas
Mnazi
Bay
Gas
Development
Bigwa - Mafia Channel
Nyuni - East Songo Songo
Ruvuma
Latham - Kimbiji
Tanga
DeepSea Block - 1
DeepSea Block - 3
Deep Sea Block - 4
Deep Sea Block-2
74
Dominion
Ophir
East
Africa Ventures
Limited
Beach
Petroleum
Dodsal
Heritage Rukwa
(TZ) Ltd
Swala Energy
Motherland
Homes
Open Acreage
Doug Rycroft
General Manager
Dominion Oil & Gas Limited,
Hamza Aziz Road, Plot 1676,
P.O. Box 23184, Dar es Salaam.
Fax : +255 22 260 2532
Email : [email protected]
Doug Rycroft
Ophir East Africa Ventures Limited
Hamza Aziz Road, Plot 1676,
P.O.Box 23184. Dar es Salaam, Tanzania
Tel +255 22 221 5526
Email: [email protected]
Marcus Mng'ong'o
Beach Petroleum (Tanzania) Ltd
First Floor. Norconsult Building. Plot No. 34A,
Winding Avenue/Zambia Road. Oysterbay
P.O. Box 33353. Dar es salaam
Tel/Fax: +255222667770
Website: beachpetroleum.com.au
DeepSea Block-7
Samir Kilachand
Dodsal Hydrocarbons & Power Ltd,
9th Floor, Extelecoms House, Samora Avenue,
P.O. Box 12049, Dar es Salaam, Tanzania
+97143431515
Email: [email protected]
James Baban
VP and Managing Director
Heritage Rukwa Tanzania Limited
4th Floor Amverton Towers. 1127 Chole Rd. Masaki
P.O.BOX 38022. Dar es salaam. Tanzania
Tell: +255-22-266 8850. Fax: +255-22-266 8313
Country Director
Swala Oil and Gas (Tanzania) Limited
Hillbrook Cottage, Kwale Road. Oysterbay
P.O.Box 8258. Dar-es-Salaam
Tanzania
The Managing Director
Motherland Industries Ltd
B-214 Morya House. Plot No. B-66/67, New Link Road
Andheri (West). Mumbai 400053. INDIA
E mail: [email protected]
[email protected]
Ruvu
Managing Director
Tanzania Petroleum Development Corporation
Plot No. 2390/12 &2392/12
Azikiwe/ Jamhuri Street
P.O.Box 2774. Da-es-Salaam. Tanzania
Tel:+255-22-2200103/4
Email: [email protected]
Kisangire - Lukurilo
Pande East
L. Tanganyika South
Lake Rukwa Basin
Kyela Basin
Kilosa-Kilombero Basin
Pangani Basin
Malagarasi Basin
Mandawa
Selous
West Songo Songo
75
ANNEX III PROJECTED POPULATION, NUMBER OF HOUSEHOLDS BY INCOME CATEGORY
Population Projection for Lindi and Mtwara Municipalities
Percent
Growth
Mtwara
Lindi
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
2025
4.1%
4.10%
4.20%
4.20%
4.50%
4.50%
4.60%
4.70%
4.80%
5.00%
5.00%
4.50%
4.50%
4.50%
108,299
112,739
117,474
122,408
127,917
33,673
139,822
146,393
153,420
161,091
169,146
176,757
184,712
193,024
78,841
81,600
84,456
87,412
90,472
93,638
96,916
100,308
103,819
109,009
114,460
120,183
126,192
132,502
Estimated number of Households by income category in Mtwara Municipal
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
2025
Low Income
70%
75,809
78,917
Middle
Income
High Income
20%
21,660
22,548
23,495
85,686
24,482
25,583
93,571
26,735
97,875
27,964
102,475
29,279
107,394
30,684
112,764
32,218
118,402
33,829
123,730
35,351
129,298
36,942
135,116
38,605
10%
10,830
11,274
11,747
12,241
12,792
1,367
13,982
14,639
15,342
16,109
16,915
17,676
18,471
19,302
108,299
112,739
117,474
122,408
127,917
133,673
139,822
146,393
153,420
161,091
169,146
176,757
184,712
193,024
Total
82,232
89,542
Estimated number of Households by income category in Lindi Municipal
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
2025
Low Income
70%
55,189
57,120
59,120
61,189
63,330
65,547
67,841
70,215
72,673
76,307
80,122
84,128
88,334
92,751
Middle
Income
High Income
22%
17,345
17,952
18,580
19,231
19,904
20,600
21,321
22,068
22,840
23,982
25,181
26,440
27,762
29,150
8%
6,307
6,528
6,757
6,993
7,238
7,491
7,753
8,025
8,305
8,721
9,157
9,615
10,095
10,600
78,841
81,600
84,456
87,412
90,472
93,638
96,916
100,308
103,819
109,009
114,460
120,183
126,192
132,502
Total
76
ANNEX IV : PROJECTED EMPLOYMENT RESULTANT OF THE INVESTMENT IN GAS INDUSTRY
Investment
in mill USD
Employment
Dangote
Cement
Jiang
Billing Limited, TCD Three Ltd and Sugar Crushing
TPA
NDC
TCIMRL
Madimba Gas Processing
Songosongo Gas Processing
Fertilizer plant
Ammonia plant
Electric Power Plant
Methanol plant
LNG
Schlumberger Workshop
Sugar plant
University (SAUTI)
Total
Cement
Sugar
Port expansion
Sesame
Iron and Coal
Gas
Gas
Urea
Ammonia
400MW
5000Mt/day
LNG
Spares
Sugar
Education
Cumulative
1,700
Short Term
Direct
Medium Term
Indirect
Direct
600
3,000
100
300
60
60
200
200
1,700
1,600
1,700
Indirect
Indirect
2,000
60
1,700
60
60
400
400
300
1,000
200
200
1,600
1,500
1,500
3,000
50
1,200
500
13,050
500
870
60
1,700
60
60
400
400
1,700
400
1,000
100
500
833
8,583
32,400
40,983
200
1,120
50
3,750
1,120
4,870
19,350
100
Direct
500
400
10000
100
500
300
14,480
10,000
Long term
2,000
2,000
300
1,000
200
200
1,600
1,500
500
1,500
20000
200
1,200
500
32,700
77
ANNEX IV: WEEKLY FOOD PURCHASES BY LOCAL CONSUMERS IN MTWARA IN TZS/WEEK
Low Income Households
Breakfast
Quantity per Week Costs per Week
Bread
Lunch
Quantity per Week Costs per Week
Dinner
Quantity per Week Costs per Week
500Gms pieces
19
Buns/bagia/half cake, etc
Pcs
40
Chapatis
Pcs
68
15,600
15,600
Vitumbuas
Pcs
66
7,200
7,200
Cassava
Kgs
27
4,500
4,500
Potatoes (Sweet)
Kgs
Potatoes (Round/Irish)
kgs
Banana (green)
Kgs
Pumpkin
Kgs
Rice Kiporo
Kgs
Litres
3.5
7,000
Kgs of flour
6
1,500
Pcs
Kgs
Chicken soup
Kgs
Vegetable(green) soup
Kgs
Vegetable soup
Kgs
Oats/flakes
Kgs
Maize/rice/sorghum uji
Juice
Litres
Yorghut
Litres
15
1
4,500
Beef soup
19,200
5,600
3
Boiled/fried eggs
Fresh milk
19,200
Total per week
1,500
5,600
1,500
3,000
4,500
4,800
11,800
1,500
Beans
Kgs
2.5
3,500
2.25
Njugu
Kgs
0
Pegion peas
Kgs
0
3,500
78
Breakfast
Quantity per Week Costs per Week
Lunch
Quantity per Week Costs per Week
Dinner
Quantity per Week Costs per Week
Total per week
Ugali
Pcs
12.5
19,500
14
19,500
Fish
Kgs
25.5
35,100
6
35,100
Beef
Kgs
3,500
3
5
5,000
0.5
4.5
5,400
17.5
Chicken
Pcs
Dagaa
Kgs
Rice
Pcs
Orange/tangarine
Pcs
0
Banana, ripe
Pcs
12
Mango
Pcs
Water melon
Pcs
Cucumber
Pcs
Passion
Pcs
Avocado
Pcs
Pawpaw
Pcs
6
Stafeli
Pcs
0
Lemon
Pcs
0
Apples
Pcs
0
Lime
Pcs
0
Pears
Pcs
0
Peas, hard/soft
Pcs
0
Pineapples
Pcs
0
Plum, yellow
Pcs
0
7,000
1
3.5
4,900
1,200
Plum, red
4,000
5,000
10,500
20,800
5,200
0
Tambi
Chips yai
3,500
0.5
Kgs
1,200
0
1,200
3
Grapes
Strawbery
Pcs
Cheese
79
Breakfast
Quantity per Week Costs per Week
Lunch
Quantity per Week Costs per Week
Dinner
Quantity per Week Costs per Week
Total per week
Vegetable - tomato
Soseji
Mchicha (Amaranthus)
28
17,800
6
17,800
Cabbage, white
Cabbage, red
Cabbage, Chinese
Capsicum green
Lettuce
Carrots
3
1,500
1,500
Peas, green fresh
Peas, green frozen
Chilli, green & yellow
Cauliflower
Brocoli
Pcs
Egg Plant
Pcs
6
3,000
Ginger
Pcs
1
100
100
Garlic
Kgs
3
900
900
3,000
Okra
Onion, red, peeled
35.5
4,000
4,000
28
9,800
0
9,800
5
6,600
4
6,600
Spinach, all type
Swiss Chard
Tangarines
Tomato, m-m
African eggplant (n/chungu)
Bamia
9
4,100
5
4,100
Matembele
18
8,300
6
8,300
Green Peper
4.5
3
3,300
Sprin Onion
3,300
0
80
Breakfast
Quantity per Week Costs per Week
Lunch
Quantity per Week Costs per Week
Kisamvu
2
Dinner
Quantity per Week Costs per Week
Total per week
1,000
1,000
Majani ya Kunde
Gees
Butter
Cereal
Conflex
Vitabix
Grand Total
230,600
Middle Income Households
Unit
Bread
Breakfast
Costs per
Week
Quantity per
Week
Lunch
Costs per
Week
Quantity per
Week
Dinner
Costs per Week
Total per week
22
32,400
32,400
Buns/bagia/half cake, etc
Pcs
154
15,400
15,400
Chapatis
Pcs
67
16,750
16,750
Vitumbuas
Pcs
21
2,100
2,100
Cassava
500Gmspcs
Quantity per
Week
Bundle Kgs
11
5,400
5,400
Potatoes (Sweet)
Kgs
-
-
-
Potatoes (Round/Irish)
kgs
-
-
-
-
22
20,000
20,000
Banana (green)
Kgs
-
-
-
-
-
-
-
Pumpkin
Kgs
-
-
-
-
-
-
-
Rice Kiporo
Kgs
13
19,200
-
-
-
-
19,200
Boiled/fried eggs
Pcs
47
22,100
-
-
-
-
22,100
Beef soup
Kgs
-
-
-
-
-
-
-
Chicken soup
Kgs
-
-
-
-
-
-
-
Vegetable(green) soup
Kgs
-
-
-
-
-
-
-
81
Vegetable soup
Kgs
-
-
-
-
-
-
-
Oats/flakes
Kgs
-
-
-
-
-
-
-
Litres
7
10,500
-
-
-
-
10,500
Fresh milk
Maize/rice/sorghum uji
Kgs of flour
-
-
-
-
-
-
-
Juice
Litres
-
-
-
-
16
8,000
8,000
Yorghut
Litres
-
-
-
-
-
-
-
Kgs
-
-
5
9,000
2
2,000
11,000
Beans
Njugu
-
-
-
-
-
-
-
Pegion peas
Kgs
-
-
-
-
-
-
-
Ugali
Pcs
-
-
19
16,900
5
6,000
22,900
Fish
Kgs
-
-
46
54,000
-
-
54,000
Beef
-
-
4
30,000
-
-
30,000
Chicken
-
-
1
14,000
-
-
14,000
-
-
-
-
-
-
-
Dagaa
Kgs
Rice
-
-
5
6,000
29
29,550
35,550
Orange/tangarine
Pcs
-
-
-
-
63
-
-
Banana, ripe
Pcs
-
-
-
-
3
1,200
1,200
Mango
Pcs
-
-
-
-
-
-
-
Water melon
Pcs
-
-
-
-
-
-
-
Cucumber
Pcs
-
-
-
-
-
-
-
Passion
Pcs
-
-
-
-
-
-
-
Avocado
Pcs
-
-
-
-
-
-
-
Pawpaw
Pcs
-
-
-
-
-
-
-
Stafeli
Pcs
-
-
-
-
-
-
-
Lemon
Pcs
-
-
-
-
-
-
-
Apples
Pcs
-
-
-
-
-
-
-
Lime
Pcs
-
-
-
-
-
-
-
Pears
Pcs
-
-
-
-
-
-
-
Peas, hard/soft
Pcs
-
-
-
-
-
-
-
Pineapples
Pcs
-
-
-
-
-
-
-
82
Plum, yellow
Pcs
-
-
-
-
-
-
-
Plum, red
Pcs
-
-
-
-
-
-
-
Tambi
-
-
-
-
-
-
-
Chips yai
-
-
-
-
-
-
-
Grapes
-
-
-
-
-
-
-
Strawbery
-
-
-
-
-
-
-
Cheese
-
-
-
-
-
-
-
Vegetable - tomato
-
-
-
-
-
-
-
Soseji
-
-
-
-
-
-
-
Mchicha (Amaranthus)
-
-
29
5,600
-
-
5,600
Cabbage, white
-
-
2
4,000
-
-
4,000
Cabbage, red
-
-
-
-
-
-
-
Cabbage, Chinese
-
-
9
900
-
-
900
Capsicum green
-
-
-
-
-
-
-
Lettuce
-
-
-
-
-
-
-
Carrots
-
-
-
-
-
-
-
Peas, green fresh
-
-
-
-
-
-
-
Peas, green frozen
-
-
-
-
-
-
-
Chilli, green & yellow
-
-
-
-
-
-
-
Cauliflower
-
-
-
-
-
-
-
Brocoli
-
-
-
-
-
-
-
Egg Plant
-
-
6
1,200
-
-
1,200
Ginger
-
-
-
-
-
-
-
Garlic
-
-
-
-
-
-
-
Okra
-
-
-
-
-
-
-
Onion, red, peeled
7
2,000
16
3,900
-
1,500
7,400
Spinach, all type
-
-
9
6,900
-
-
6,900
Swiss Chard
-
-
-
-
-
-
-
Tangarines
-
-
-
-
-
-
-
Tomato, m-m
7
3,500
28
14,000
-
4,000
21,500
83
African eggplant (n/chungu)
-
-
-
-
-
-
-
Bamia
-
-
6
3,600
-
-
3,600
Matembele
-
-
20
9,500
-
-
9,500
Green Peper
-
-
14
2,800
-
-
2,800
Sprin Onion
-
-
-
-
-
-
-
Kisamvu
-
-
4
1,000
-
-
1,000
Majani ya Kunde
-
-
2
2,000
-
-
2,000
Gees
-
-
-
-
-
-
-
Butteo
-
-
-
-
-
-
-
Cereal
-
-
-
-
-
-
-
Conflex
-
-
-
-
-
-
-
Vitabix
-
-
-
-
-
-
-
Grand Total
386,900
High Income
Breakfast
Quantity per
Costs per
Week
Week
Lunch
Quantity per
Costs per
Week
Week
Quantity per
Week
Dinner
Costs per Week
Total
Bread
2 500Gms pieces
43
48,250
-
-
-
-
48,250
Buns/bagia/half cake, etc
Pcs
52
14,300
-
-
-
-
14,300
Chapatis
Pcs
60
-
-
-
-
12,600
Vitumbuas
Pcs
200
2,000
-
-
-
-
2,000
Cassava
Bundle Kgs
50
13,200
-
-
-
-
13,200
Potatoes (Sweet)
fungu Kgs
50
13,600
-
-
-
-
13,600
Potatoes (Round/Irish)
kgs
-
-
-
1
2
Banana (green)
Kgs
-
-
-
-
-
Pumpkin
Kgs
-
-
-
1
1
12,600
2,800
2,801
-
-
300
301
84
Breakfast
Quantity per
Costs per
Week
Week
Rice Kiporo
Kgs
-
Boiled/fried eggs
Pcs
23
Beef soup
Kgs
-
-
Chicken soup
Kgs
-
Vegetable(green) soup
Kgs
Vegetable soup
Oats/flakes
-
Lunch
Quantity per
Costs per
Week
Week
Quantity per
Week
Dinner
Costs per Week
-
7
7
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Kgs
-
-
-
-
-
-
-
Kgs
-
-
-
-
-
-
-
Fresh milk
Litres
24
26,000
-
-
-
-
Maize/rice/sorghum uji
Kgs of flour
16
5,875
-
-
-
Juice
10 Litres
-
-
-
20
28
Yorghut
Litres
-
-
-
-
-
Beans
1/4 Kgs
2
2,800
-
Njugu
1 Kgs
2
3,600
-
-
-
-
3,600
Pegion peas
Fungu
2
2,600
-
-
-
-
2,600
Ugali
2 kgs
-
-
-
11
8
17,600
17,611
Fish
2kg
-
-
-
14
17
137,000
137,014
Beef
Pcs
3
-
9
12
100,700
110,709
Chicken
1kg
-
-
-
5
7
77,000
77,005
Dagaa
pcs
-
-
-
3
2
7,000
7,003
Rice
1.5 Kgs
-
-
-
-
-
-
-
Orange/tangarine
Pcs
-
-
-
-
-
-
-
Banana, ripe
Pcs
-
-
-
-
-
-
-
Mango
Pcs
-
-
-
-
-
-
-
Water melon
Pcs
-
-
-
-
-
-
-
Cucumber
Pcs
-
-
-
-
-
-
-
Passion
Pcs
-
-
-
-
-
-
-
Avocado
Pcs
-
-
-
-
-
-
-
2,500
10,000
12
9,100
Total
42,700
19,750
9,107
2,500
26,000
5,875
42,720
22,550
85
Breakfast
Quantity per
Costs per
Week
Week
Lunch
Quantity per
Costs per
Week
Week
Quantity per
Week
Dinner
Costs per Week
Total
Pawpaw
Pcs
-
-
-
-
-
-
-
Stafeli
Pcs
-
-
-
-
-
-
-
Lemon
Pcs
-
-
-
-
-
-
-
Apples
Pcs
-
-
-
-
-
-
-
Lime
Pcs
-
-
-
-
-
-
-
Pears
Pcs
-
-
-
-
-
-
-
Peas, hard/soft
Pcs
-
-
-
-
-
-
-
Pineapples
Pcs
-
-
-
-
-
-
-
Plum, yellow
Pcs
-
-
-
-
-
-
-
Plum, red
Pcs
-
-
-
-
-
-
-
Tambi
1 pkt
9
-
-
-
-
Chips yai
6pcs
-
-
-
-
-
-
-
Grapes
-
-
-
-
-
-
-
Strawbery
-
-
-
-
-
-
-
Cheese
4
5,000
-
-
-
-
5,000
Vegetable - tomato
14
28,000
-
-
-
-
28,000
Soseji
-
-
-
-
-
Mchicha (Amaranthus)
-
-
-
10
19
20,000
20,010
Cabbage, white
-
-
-
17
17
39,500
39,517
Cabbage, red
-
-
-
-
-
-
-
Cabbage, Chinese
-
-
-
-
-
-
-
Capsicum green
-
-
-
-
-
-
-
Lettuce
-
-
-
1
5
37,500
37,501
Carrots
-
-
-
14
20
84,000
84,014
Peas, green fresh
-
-
-
3
9
63,000
63,003
Peas, green frozen
-
-
-
-
-
Chilli, green & yellow
-
-
-
8
8
9,500
-
7,100
9,500
-
7,108
86
Breakfast
Quantity per
Costs per
Week
Week
Lunch
Quantity per
Costs per
Week
Week
Dinner
Costs per Week
Total
5
11,000
11,005
Quantity per
Week
Cauliflower
-
-
-
5
Brocoli
-
-
-
4
4
10,000
10,004
Egg Plant
-
-
-
7
13
11,000
11,007
Ginger
-
-
-
5
10
19,500
19,505
Garlic
-
-
-
5
6
20,750
20,755
Okra
-
-
-
5
7
17,000
17,005
Onion, red, peeled
-
-
-
21
21
18,300
18,321
Spinach, all type
-
-
-
16
14,012
10,000
10,016
Swiss Chard
-
-
-
-
-
Tangarines
-
-
-
1
5
30,000
30,001
Tomato, m-m
-
-
-
19
19
27,500
27,519
African eggplant (n/chungu)
-
-
-
3
3
4,000
4,003
Bamia
-
-
-
2
4
6,000
6,002
Matembele
-
-
-
3
7
7,000
7,003
Green Peper
-
-
-
7
7
5,250
5,257
Sprin Onion
-
-
-
9
15
17,750
17,759
Kisamvu
-
-
-
-
-
-
-
Majani ya Kunde
-
-
-
-
-
-
-
Gees
-
-
-
-
-
-
-
Butteo
-
-
-
-
-
-
-
Cereal
-
-
-
-
-
-
-
-
-
Conflex
12,000
12,000
-
-
-
-
12,000
Vitabix
12,000
12,000
-
-
-
-
12,000
____
Grand Total
1,104,161
87