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Poverty and Human Development Report 2009 - UNDP in Tanzania

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Figure 6: FDI Inflows 2000-2008 (USD millions)<br />

Years<br />

800<br />

700<br />

600<br />

500<br />

400<br />

300<br />

200<br />

100<br />

0<br />

463.4<br />

467.2<br />

387.6<br />

308.2<br />

330.6<br />

447.6<br />

616.6<br />

653.4<br />

695.5<br />

2000 2001 2002 2003 2004 2005 2006 2007 2008<br />

note: figure for 2008 is the budget estimate<br />

source: economic survey 2008<br />

FDI Inflows (US$ Million)<br />

tanzania has great potential to attract <strong>in</strong>creased fdi <strong>in</strong> com<strong>in</strong>g years, though <strong>in</strong>vestments<br />

will likely be attracted to the sector where tanzania’s comparative advantage is clear: natural<br />

resources. at the same time, the ease of do<strong>in</strong>g bus<strong>in</strong>ess is an important factor. fdi <strong>in</strong>flows,<br />

while grow<strong>in</strong>g steadily, fell significantly short of the overall level of <strong>in</strong>terest registered by potential<br />

<strong>in</strong>vestors, reflect<strong>in</strong>g <strong>in</strong> part cont<strong>in</strong>ued difficulties of do<strong>in</strong>g bus<strong>in</strong>ess locally. tanzania compares<br />

poorly to other countries, <strong>in</strong>clud<strong>in</strong>g neighbour<strong>in</strong>g Kenya <strong>and</strong> Ug<strong>and</strong>a, <strong>in</strong> terms of do<strong>in</strong>g bus<strong>in</strong>ess.<br />

it is ranked 127 out of 181 economies covered by the world bank’s Do<strong>in</strong>g Bus<strong>in</strong>ess <strong>2009</strong><br />

<strong>Report</strong> (table 5). factors that cont<strong>in</strong>ue to underm<strong>in</strong>e foreign <strong>in</strong>vestment <strong>in</strong>clude control <strong>and</strong><br />

ownership rights of production resources (especially l<strong>and</strong>), non-tariff barriers such as customs<br />

<strong>and</strong> adm<strong>in</strong>istrative procedures, regulations <strong>and</strong> licenses. the lack of physical <strong>in</strong>frastructure is an<br />

ongo<strong>in</strong>g constra<strong>in</strong>t which will take time to address.<br />

Table 5: Ease of Do<strong>in</strong>g Bus<strong>in</strong>ess <strong>in</strong> Selected Sub-Saharan African Economies<br />

(Rank) <strong>2009</strong><br />

Mauritius<br />

South<br />

Africa<br />

Botswana Kenya Ghana Zambia Ug<strong>and</strong>a <strong>Tanzania</strong><br />

SSA<br />

mean<br />

SSA<br />

median<br />

24 32 38 82 87 100 111 127 136.7 148.5<br />

source: world bank, <strong>2009</strong>a<br />

Chapter I CLUSter 1 GOaL 2<br />

17

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