By Giza Mdoe
The island has huge agriculture and tourism potential that
is yet to be utilized effectively. Now, Zanzibar President Hussein Mwinyi wants
the country's diplomats to do more to attract foreign direct investment.
Zanzibar President Mwinyi recently aired his views during
talks with newly appointed Foreign Affairs and East Africa Cooperation Minister
Dr Stergomena Tax, emphasizing the need for what he described as economic
diplomacy.
According to President Mwinyi, the Zanzibar economy can do
better if the country's diplomats become more proactive in attracting foreign
direct investment. President Mwinyi said Zanzibar's economy stands to gain from
economic diplomacy should its ambassadors sway investors in its favour.
"We need economic diplomacy... this should include
wooing investors to come and invest. It is important for us considering that
Zanzibar relies heavily on services in the tourism industry for its
income," President Mwinyi urged the ambassador.
The advice, coming from a president, is, as a matter of
fact, an executive order, and the newly appointed diplomat did not let
President Mwinyi down.
Ambassador Tax seized the opportunity to pledge to place
Zanzibar's economy on the pedestal in his next visit to China, where he will be
accompanying President Samia Suluhu Hassan.
" We will promote Zanzibar and Tanzania in general so
that investors can come to invest, especially in the island's blue
economy," she promised President Mwinyi.
In response, Minister Tax promised to implement the
directives, including consideration of Zanzibar in all dealings that regard the
Union government and tasked ambassadors abroad to focus on economic diplomacy
and ensure Tanzanians have enough information about the ministry and what is
going on in fast-tracking of the EAC integration.
A blue economy: Zanzibar economy overview
Generally speaking, despite global turmoil, including
setbacks by the Covid-19 pandemic, Zanzibar's economic performance has been
fairly stable. Zanzibar's economy is divided into three major sectors, service
(tourism, trade, transportation and storage, and other private and public
services); industries (manufacturing, construction, and mining); and
agriculture (including forestry, crops, livestock, and fishing).
According to authorities, 'the contributions of these
sectors to GDP are 51.7 per cent, 20.1 per cent, and 18.4 per cent,
respectively, for services, agriculture, and industries respectively.'
A blue economy, according to the World Bank, is the
sustainable use of resources for economic growth, and improved livelihoods and
jobs, while preserving the health of the ocean ecosystem. Generally speaking, a
blue economy refers to all economic activities related to oceans, seas and
coasts.
To promote its blue economy, Zanzibar recently started
leasing out small islets surrounding the main archipelago and has already
pocketed US$15 million in advance leasing fees for some ten islets.In his
budget speech earlier this year, the Island's second Vice President, Hemed
Suleiman Abdulla, Zanzibar's economy is expected to grow by 6.8 per cent this
year, up from 5.1 per cent in 2021
Similarly, export earnings in the Islands increased 138 per
cent from an approximated US$28.1 million in 2020 to US$66.6 million in 202
thanks to increased export of clove and seaweed and of course, the leasing of
islets.
To further boost its blue economy, Zanzibar has set aside
several Special Economic Zones (SEZ), Free Economic Zones (FEZ) and Export
Processing Zones (EPZ). These are strategic policy moves to attract investors
since, other than sensitive areas like food and medicines, investors in the EPZ
or SEZ are not required to get any extra licensing, making setting up a
business much easier, faster and more affordable.
These policies help increase investment in the blue economy
and attract foreign direct investment (FDI) through the expansion of exports.
As pointed out, investors operating in these special zones
enjoy lean administrative procedures and lower operating costs. Zanzibar
already has five free economic zones to increase investment in its blue
economy.
As the blue economy grows, so does tourism. In 2021,
Zanzibar saw a surge in tourist visits as the number went over 394,200
tourists, up from 260,600 in 2020.
Zanzibar is also building closer ties with the United Arab
Emirates (UAE), even as other countries in the East African Community (EAC) are
losing favour with the wealthy UAE. Only recently, the UAE announced a visa ban
on several EAC countries, including Uganda and Rwanda, all close neighbours to
Zanzibar.
UAE places visa ban on 20 African countries
While ties with Zanzibar and mainland Tanzania are growing
with the recent signing of agreements to end double taxation, among other
deals, authorities in the United Arab Emirates (UAE) recently announced a Dubai
visa ban on 20 African countries.
They include Uganda, Rwanda, Ghana, Sierra Leone, Sudan,
Cameroon, Nigeria, Liberia, Burundi, Republic of Guinea, Gambia, Togo,
Democratic Republic of Congo, Senegal, Benin, Ivory Coast, Congo, Burkina Faso,
Guinea Bissau, Comoros and the Dominican Republic.
"Any applications from the above-mentioned countries
will be sent back or cancelled," the UAE authorities warned trade partner
authorities along with travel agents, urging them to reject all related
applications.
The reason given for the ban is increased visa term
violations by persons from the said countries. The UAE authorities explained
that persons from these countries are using 30-day visas to Dubai to stay and
work in the country illegally.
Before this most recent move, authorities in UAE introduced
a requirement that all migrant workers from said countries present police
certificates of good conduct before entering the country, but even that did not
help.
The UAE authorities also revealed that more than 600
Ugandans who were living in UAE illegally were recent. Annually, the United
Arab Emirates (UAE), particularly Dubai, has become a favourite destination for
Africa's migrant labour as thousands look for better-paying jobs in the UAE to
improve their lives.
However, with the visa ban, migrant labour to the UAE will
see a sharp drop which may, to some extent, allow migrant workers from
countries that still have the privilege to find jobs much more easily.
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