Value Addition in Tanzania

Value Addition in Tanzania refers to the processes that increase the value of raw materials or goods before they are exported. This can involve transforming raw materials into processed goods, adding branding or packaging, or offering specialized services. While Tanzania has made strides in some sectors, the country can continue to achieve significant Value Addition, for instance in agricultural, mineral and other products. 

Value Addition is of course an important building block. For instance Aspiration 1 – A prosperous Africa based on inclusive growth and sustainable development of “The African Union Vision of The Africa We Want Agenda 2063” includes “A continent where poverty is eradicated in one generation and shared prosperity is built through social and economic transformation of the continent through manufacturing, value addition and science and technology-driven innovation.”

Challenges and Opportunities:

• Limited Processing Capacity: limited Value Addition activity can hinder the ability to capture more wealth from exports. Locally processed products, such as fruits and minerals, can get higher prices in the global market compared to the price of exports of raw goods. 
• Need for Collaboration: value addition efforts require collaboration between public and private sectors, mining stakeholders and research institutions. 
• Government Initiatives: of course the Tanzanian government is actively promoting Value Addition, particularly in the mining sector, by designating special zones for mineral processing plants and supporting the “Manufacturing Africa” project, which aims to boost local manufacturing of intermediate and final mineral products. 
• Focus on Specific Sectors: the Ministry of Minerals is actively promoting Value Addition for minerals, including beneficiation, processing, refining, and manufacturing. 
• Agricultural Value Addition: also there is a growing emphasis on Value Addition in agriculture, with initiatives like farmer-owned processing facilities and producing higher-value products like organic produce. 
• Opportunities in Mineral Value Addition: Tanzania’s rich mineral resources, including gold and other critical minerals, present significant opportunities for Value Addition, potentially leading to increased exports and job creation. 

Examples of Value Addition:

• Agricultural Value Addition: examples include processing fruits like oranges and pineapples, transforming coffee and tea into ready-to-drink products and creating Value Addition products from cashew nuts. 
• Mineral Value Addition: this includes processing minerals like gold, refining into bullion, coins, and jewellery, and processing lithium for battery production. 
• Other Value-Added Products: this could include adding brand names to generic products or assembling products in innovative ways. 
• Energy Sector Value Addition: see for example How Electricity is Powering Value Addition in Tanzania’s Villages. Better health, education, jobs, and livelihoods are becoming a reality for many villagers across Tanzania, thanks to the multiphase $550 million support to REA via the Tanzania Rural Electrification Expansion Program (TREEP)–Program for Results, financed by the World Bank’s International Development Association (IDA) ($535 million), the Energy Sector Management Assistance Program ($6 million), and highly concessional funding from CIF’s Scaling up Renewable Energy Program ($9 million).

Conclusion:

Value Addition is crucial to increase economic gains from exports. Value Addition can also help to create jobs. The government’s initiatives, coupled with private sector involvement and collaborations, can drive Value Addition efforts in various sectors, particularly in minerals and agriculture. 

At VELMA Law we believe that a stronger, healthier and wealthier community comes from a well enforced rule of local and international law which enables both public and private sector interests to develop for the benefit of the whole community and the self.

So if you have a project which will achieve Value Addition to a product or produce here in Tanzania then we would love to meet with you to talk about how we can help you achieve your goals using all our hard earned local and international project experience – and we can conclude the initial conversation by considering a success related discount on our fees.