Economic Undertakings

In Tanzania, Tackling Markets to Support Small Businesses

New project focused on selected value chains, from seaweed to honey

The vast majority of those who cultivate seaweed on the shores of Zanzibar are women. It is hard work that involves long hours in the water and heavy loads. And, as the water temperature rises, people are forced to work farther and farther from the land.

The occupation provided an economic advantage to many women and young people in Tanzania, who were able to support their households with the income generated from the sale of their products in the market. As the seaweed industry is a global enterprise, a new partnership between the Enhanced Integrated Framework (EIF) and the United Nations Development Program (UNDP) targets this sector, as well as four other agro-industrial value chains in the country, which can bring many benefits to women and youth through the development of trade.

Here’s how.

1) Analyze the markets

With the aim of boosting incomes and the national economy, five selected value chains were identified from a recent analysis that could have the greatest impact on the livelihoods of the rural population of the country, focusing on specifically on women and young people. These include honey, palm products, horticulture, seaweed and anchovies.

“Instead of starting with production and finding a market, we decided to start from markets,” said Emmanuel Nnko, head of the Inclusive Growth pillar at UNDP, which implements the project.

More accessible and competitive markets nationally, regionally and internationally can serve to reduce poverty, while providing a host of broader benefits for sustainable economic growth. Well-functioning markets stimulate investment and encourage small businesses to innovate, reduce costs and create jobs.

Looking at demand in the Middle East, Asia and Europe, as well as what was happening with regional markets, the analysis revealed what Tanzania has to offer. Baseline surveys have been carried out for the sectors and a plan has been put in place to define how the project could better support those who work there.

2) Build on previous work

As one of the least developed countries, the government of Tanzania has been an EIF partner for more than a decade as the country strives to boost trade. This includes a series of studies on the business environment, most recently a diagnostic in 2017 that focused on the agro-industrial and tourism potential of Tanzania. In addition to this, the EIF worked with the Swiss government and multiple partners of the United Nations system on a United Nations Trade Cluster project that has helped Tanzania to build links between agro-industry and tourism sectors.

UNDP has also recently completed work focusing on horticulture in the country.

“Why horticulture? Horticulture is the fastest growing sub-sector in the Tanzanian agricultural sector, with an average annual growth of around 11%. This growth is more than double the overall growth rate of the agricultural sector. The sub-sector is also a major employer in Tanzania, providing jobs for around 4.4 million people, including 400,000 women, ”Nnko said.

The previous UNDP project addressed issues ranging from productivity to improving the business environment, technological advancement and market access for finance. Extension workers helped women increase their productivity by using drip irrigation and monitoring soil health. The new EIF and UNDP partnership in Tanzania will build on UNDP’s experience in supporting women and young horticulturalists, and on the specifics of delivering products to established markets.

3) Contact the institutions

Providing technical assistance is a necessary part of the job. This includes putting good research into the hands of government, including the Ministry of Industry and Commerce. The project is developing an e-commerce framework and strategy for Tanzania, as the country lays the foundation for a digital economy.

“We need to have some kind of framework that will guide these companies around the services of the digital economy,” Nnko said. “But we also expect MSME sales and exports to increase, which requires improving trade and investment environments, for example by putting in place enabling policies and regulatory frameworks, which will help eventually to trade and investment to prosper. “

4) Leverage resources

A collection of resources from different institutions are dedicated to this work, including $ 2.1 million from the EIF, an in-kind contribution of $ 240,000 from the Ministry of Industry and Trade and $ 500,000 from UNDP. It is hoped that additional resources to support small businesses will arrive as these efforts progress.

5) Focus on free trade in Africa

Tanzania is expected to ratify the African Continental Free Trade Agreement (AfCFTA) later this year, and the partnership is developing analysis to determine how the country can best position itself in the midst of this new opportunity. The study undertaken will focus on an in-depth cost-benefit analysis of AfCFTA and market access opportunities for Tanzania.

“The document will support and inform the government here, examining the benefits the AfCFTA can bring and potential new markets,” Nnko said.

In combination with institutional coordination and the type of targeted support offered by EIF and UNDP, according to Nnko, a ‘360 degree type of intervention’, Tanzania continues to position itself for smoother local, regional and international trade. .

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