Tanzania CCP Magazine

www.ccp-tpsf.org

Tanzania

CCP Magazine

Competitiveness

Issue 1

December 2011—February 2012

Improving Tanzania’s

Globally

Improving Tanzania’s competitiveness

today

www.ccp-tpsf.org

Compete

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D E C E M B E R 2 0 1 1 — F E B R U A R Y 2 0 1 1

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Greetings to our readers IN THIS ISSUE

I welcome everyone to read the first edition of the Tanzania CCP Newsletter. The TPSF Cluster Competitiveness Program will publish this newsletter in both hard and soft copy editions several times per year.

Karibu to the Celebration

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The focus of the newsletter is on competitiveness – specifically improving Tanzanian competitiveness.

Competitiveness: 6 Tanzania’s Framework

Competitiveness is a term being used a lot these days, something we are very glad to see happening. This newsletter seeks to take some of the mystery out of the term and provide clarity into what improved competitiveness really means in the Tanzanian context.

Tall. Full. Glass of 9, 13 Milk Matching Grants

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Shrinking Markets

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Competitive Collaborations

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Strengthening Cluster Partnerships

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…a private and public sector cooperating on improved regulations, improved physical infrastructure, a more educated and skilled workforce, access to finance at reasonable rates, access to specialized business development services, and business owners with the knowledge to compete domestically and internationally – these are some of the necessary factors for a country to move up the competitiveness scale.

In this edition you will find features on horticulture, tourism and food processing – CCP’s core industries – but also articles with relevance to the economy in the broader view, which cut across the spectrum of industry clusters.

We hope you benefit from this newsletter and we welcome your feedback.

Hayley Alexander CCP Team Leader

Publisher Tanzania CCP Magazine is designed and published by Barefoot Consulting Limited in collaboration with Rose Thuo, Consultant PR and Media Specialists.

All articles published in this magazine were written by the employees of the TPSF Cluster Competitiveness Program. Any misrepresentation should be addressed to the distributors on the following address: TPSF Cluster Competitiveness Program, Plot 1288, Mwaya Road, Msasani Peninsula, P.O.Box 11313, Dar es Salaam, Tanzania

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Karibu to the Celebration of 15 years of Cultural Tourism

By Mrs. Mary Kalikawe CCP Tourism Cluster Specialist

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t was in Arusha, a day just before the annual Karibu Travel and tourism fair affectionately known as “KARIBU” (Swahili for welcome), that the Tanzania cultural tourism fraternity converged to celebrate 15 years of Cultural Tourism in Tanzania.

The immediate feeling of cultural tourism in Tanzania is a welcome among the most friendly people in the world to experience real African life, seeing fascinating areas and enjoying the beautiful scenery of green mountains, inland lakes, wide plains and the dramatic Rift Valley.

A look at the definition of cultural tourism and attractions show that “Cultural tourism is when tourists consume culture (that is lifestyles including customs and traditions, heritage, museums, visual and performing arts, industries, traditions and leisure) of the local population and host community as a form of entertainment and education.

This sheds light on: dress codes such on the Swahili cost, architecture such as Makumbusho village, Gastronomy such as traditional food served in local peoples homes, local restaurants and other catering and Heritage including caves and ancient rock art.

The industrialized world has adopted creative industries as encompassing the full concept of Cultural tourism. Britain Prime Minister Tony Blair led this some 10 years ago.

At present, the Tanzania Tourism Board (TTB) runs the Tanzania Cultural Tourism Program’s office, which is based in Arusha.

15 years ago, SNV, the Dutch development organization helped establish the Cultural Tourism Program in Tanzania.

In 1996, there existed only 3 tourism enterprises that were definitively cultural tourism operators. Today there are 34 enterprises that can be classified as cultural tourism operators. The TTB together with SNV have managed the sustainable growth of this treasured sector.

Man made cultural attractions Creating city identity enhances urban tourism.

Tanzania cities and Municipalities can develop their identities by developing unique Stadiums and variety of sports,

Architecture such as bridges, monuments, airports or Environment e.g. players in all three of the functional areas—heritage (cultural); botanical gardens, Agriculture e.g. coffee and tea arts, and the media The work of SNV and develplantations, events e.g. opment of cultural tourism in Northern Tanzania is a valuable start expos, trade fairs and festivals, religion: cathedrals and pilgrimage in diversifying Tanzania’s tourism product from over dependence sites. Such cultural tourism creates higher levels of self employment. on wildlife and safari tourism. Further diversification will result in stimulating tourism development over a wider geographical area in Tanzania and hence the creation of more jobs and income from The creative economy is considered to be one of the fastest growing tourism. sectors of the economy in many Western industrialized countries. It employs around 34 per cent of the working population and contrib-

Creative industries classification, in which, Tanzania has major

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utes a similar percentage to the annual GDP.

Examples that we already have include Zanzibar’s Sauti za Busara and International film festival (ZIFF) attracting 45,000 foreign visitors and 123,000 local visitors every year. Mwanza has a variety of sports and the annual East Africa trade Fair. Dar es salaam has the explosion of Bongo Flava and the economic benefits it is generating are considerable.

So how can we do it?

Develop competitiveness in various potential cities and municipalities by addressing underdevelopment of Creative Industries (CI). Use knowledge based strategies such as CI task force tasked with mapping e.g. music industry clusters, Heritage cluster and make plans to open the first City or municipal museum.

Develop skills to run the industry such as running an annual festival, Develop the product through investors, investigate the market and how to coordinate it with the cultural tourism enterprises

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Work on addressing better physical and credit infrastructure

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Create awareness to policy makers of the correlation of CI with job creation and GDP and the economic multiplier effect

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Launch to attract investors and promote marketing for the domestic and the international market.

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One of the ways to improve employment potential is for city planners to set aside areas for cultural tourism to operate e.g. craft shops, cultural performances, camping sites and monuments

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This can be along high ways, within or near towns and cities or close to major tourist attractions.

Encourage community to produce inputs such as dancing skirts and other regalia, drums, basket dyes. Take part in trade fairs so they learn and exchange.

In conclusion there are these probing questions: What can we do differently so that we improve how cultural tourism is done at the national scale? Tanzania has a rich diversity of cultures. What can be done to take advantage of that diversity? What about Wagogo or Wahaya? What is the role of Cultural district officers? How can they be better mobilized for cultural tours? How can we better promote a product that highlights cultural spots around Tanzania? How well are we using tourist guidebooks like the lonely planet to highlight cultural spots along the way for back packers?

Beyond East Africa, Tanzania can learn from others and the global trend to the creative economy and creative industries this is replacing our definition of cultural tourism, which is only based on heritage and the arts.

Mary Khalikawe is an Environmentalist, Tourism development expert, Wildlife Biologist, Human resource Development Expert and an author. At TPSF her work involves promoting the competitiveness of tourism clusters around Tanzania so they can achieve sustainable growth through stronger cooperation while building capacity in private and public sector institutions to operate strategically in the pursuit of common objectives

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Competitiveness: Tanzania’s Framework By: Hayley Alexander CCP Team Leader

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arlier this year, a CCP short-term consultant worked closely with the TPSF policy team to complete the Tanzania National Competitiveness Report (TNCR). The TNCR is the first Tanzanian study of its kind to assess the country’s competitiveness from a holistic perspective. The report takes into account the key factors necessary to enable the private sector to improve its productivity and therefore compete more effectively domestically and internationally.

competitiveness.

TPSF-CCP is focused on three of the above seven factors in our quest to increase Tanzania’s competitiveness: 1) Productivity 2) Legal & Regulatory and 3) Labor & Workforce. When compared against CCP’s three expected outcomes, they line up as shown in the table (Table: CCP Expected Outcomes).

By their very nature, improving productivity, developing labor and workforce skills and effecting legal and regulatory reform require focused, persistent and sustained efforts. Short term successes are certainly possible, as CCP is demonstrating; however, sustainability and indeed continued progress only occurs with significant improvements in the capacity of public and private sector organizations to act as serFor perspective and context, and as an aid to understanding the types vice providers for private sector firms. For this reason, CCP is devotof issues any country needs to address while improving its competitive ing a substantial portion of resources to strengthening local capacity stance, the TNCR offers the competitiveness framework. The graphi- (Table: CCP Expected Outcomes).

A few examples: Supporting ten associations through grants to respond to member needs with practical training services, upgraded industry marketing and improved stakeholder coordination.

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Supporting a further four associations with technical assistance to improve professionalism and member service provision, and foster local cluster development.

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Providing grants to three local training institutions to develop and offer highly practical, training curricula, based on industry identified needs, for direct use with workforce (continuing professional development).

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cal illustration of this framework is a pyramid which serves to emphasize that improving competitiveness involves creating a strong base or foundation from which to build upon. Three distinct levels are therefore indicated. 1) Foundational elements, which are big picture items such as physical infrastructure, important to get right first; 2) Enabling elements such as the presence of an educated workforce, critical for normalized private sector development and; 3) Productivity, which is both an outcome and a target for intervention, most notably within the private sector, e.g., providing access to automation. The summation of all three levels, when strengthened, should enable improved

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Helping develop and offer competitiveness training in ten regions via CCP partner UD-COET.

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Providing grants to four industry cluster groups via lead firms, famer groups and cooperatives to improve production and cold chain infrastructure (and knowledge in use thereof) affecting thousands of individuals.

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Helping organize, train, mentor and systematize the running of public private dialogue groups in tourism and food processing in a

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process leading to competitiveness partnerships.

The TNCR’s expansive perspective assists the Tanzanian government, business support organisations (such as TPSF) and other technical support programs to see the competitiveness puzzle in its entirety, thereby gauging what needs to be done and by which organizations. As noted above, TPSF-CCP is active in three areas of the

OUTCOME Strengthened clusters and value chains

INCLUDED COMPETITIVENESS FRAMEWORK ELEMENTS Productivity – adoption of automation & international standards, expanded value chains & market linkages Labor and workforce – upgraded skills, knowledge and practices for workforce & management

'Short-term successes

Upgraded local competitiveness capacity

All three (Productivity, Labor and workforce, Legal and regulatory) – capacity building amongst industry, associations and NGOs, training institutions & government to educate, inform and seek common ground amongst the public and private sector

Increased pace of regulatory reform

Legal and regulatory – evidence based, sector specific issues prioritized and articulated, PPD groups established

are certainly possible, as CCP is demonstrating; however,

Table: CCP Expected Outcomes

sustainability and indeed continued progress only occurs with significant improvements in the capacity of the public and private sector organizations to act as service providers.

pyramid, whereas numerous other programs are addressing the remaining areas.

When the concept of the TNCR was first presented to Tanzanian stakeholders, there were concerns it amounted to just another assessment of Tanzania’s present state and one that would in fact needlessly overlap with other ongoing initiatives. Most concern centered around potential redundancy vis-à-vis the Roadmap, led by the Committee established by the President to improve Tanzania’s World Bank Doing Business rankings.

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In reality, the TNCR is neither just another assessment nor is it redundant in light of any ongoing efforts. In fact, it serves to underscore the importance of all components necessary to improve competitiveness while illuminating their synergies. The Roadmap, for instance, is primarily focused on just one aspect of the competitiveness framework – the legal and regulatory environment.

Some of the most urgent interventions in support of improved competitiveness must be concentrated on the foundational level of the pyramid. Issues such as improving physical infrastructure, including, electricity, roads and ports, and upgrading social infrastructure, particularly strengthening the educational system (primary through high school), are critical. Without the basic functionality afforded to companies via access to electricity and the presence of educated citizenry, for instance, all other efforts will be insufficient and compromised.

The Tanzanian National Competitiveness Report has been well received by the Prime Minister’s Office – the Permanent Secretary in particular – and many members of the business community. It is time to proceed with broader distribution of the TNCR’s findings, along with its ten primary recommendations, to better align government, business support organizations, academia and industry toward consensus in competitiveness priorities and subsequent actions.

Hayley Alexander is the team leader of the Cluster Competitiveness Program, Tanzania.

He has more than seventeen years outside the US working on economic development programs in 10 countries with long term project postings in seven including: Russia, Egypt, Ukraine, Bosnia-Herzegovina, Croatia, Armenia and Tanzania. Experience centered on private sector development, institutional strengthening and improved competitiveness.

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INVITATION TO THE FIRST HORTICULTURAL SHOW IN TANZANIA -- 1-3RD DECEMBER 2011 Dear Esteemed horticultural stakeholder, Many Greetings from TAHA! I feel greatly honored and humbled to provide you with this useful information and invite you to come join us at the planned first horticultural show in Tanzania.

In commemoration of the 50 years of Tanzania independence, TAHA, with the support of the Tanzania Cluster Competitiveness Program (TCCP), and in close collaboration with the World Vegetable Centre (AVRDC) has therefore organized for the first local horticultural show in Tanzania to be held from December 1st to 3rd at the AVRDC grounds in Tengeru - Arusha. The show is expected to bring together farmers, service providers and buyers from different parts of Tanzania daily, so as to learn from each other as well as making different business negotiations. It is expected that there will be on farm demonstrations as well as tented exhibitions most of which will be done by industry service providers who have already confirmed their participation. The gist of the show is therefore to capacity build farmers and other actors in horticulture on various issues concerning horticultural businesses. There shall also be trainings on different topics by different service providers.

Jacqueline Mkindi, Executive Director, Tanzania Horticultural Association Kanisa Road, House No 49, P. O. Box 16520 Arusha, Tanzania. Tel/ Fax +255-27-2544568. Cell +255 754 306878 E-mail: taha@habari.co.tz Web: www.tanzaniahorticulture.com " DEVOTED TO DEVELOP AND PROMOTE THE HORTICULTURAL INDUSTRY IN TANZANIA" Determination, Strategy and Vision for the future are our real resources in the quest for excellence and success!

Horticulture kwa afya na mapato zaidi!

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Tall. Full. Glass of Milk Where there are forests there are no builders The Swahili saying ‘Penye miti hakuna wajenzi ‘reflects Tanzania’s situation with potential for natural resources, crops, mines, plenty of water and livestock, etc. but with few developed agro processing industries.

Arusha region for example is the leading cattle keeper in Tanzania with a large number of dairy cows, but surprisingly enough, Arusha market is full of dairy products from Kenya and other countries. Very few dairy products from Arusha dairy industries could be found in shops, supermarkets and hotels (some from Arusha dairy and Serengeti fresh dairy)

despite the fact that there are more than 15 dairy processors in Arusha. It is high time for Tanzanians to unlock our mindset to explore the potentiality we have.

It seems the poverty is locked in our mind; we need to open up, be aggressive and highly committed to work and face the challenges for economic growth.

>> continued page 13

CCP Grants The Tanzania Cluster Competitiveness Programme is among other things to support the development of clusters by offering grants to different projects that falls under Food Processing, Tourism and Horticulture. Supporting the clusters has been in building infrastructure base, institutional strengthening and capacity building. The priority areas for most of the grants have been in supporting the programmes which enhances the clusters in technological innovations, development and transfer.

Infrastructural activities supported include the construction of buildings for shared facilities, and procurement of processing equipments.

Institutional strengthening includes the cluster automation and all activities that involve the application of ICT. Another area includes the capacity building in form of organizing trainings in management, leadership development.

All these supported have enhanced members of the clusters to conform and acquire local and international standards like TFDA, Global GAP, TBS, and Tourism Health & Safety Codes.

>> continued page 16

Shrinking Markets A typical marketing paradox is that buyers, such as supermarkets and processors, complain about inadequate supply while farmers complain about lack of markets. CCP’s experience of working with farmers involved in various horticulture supply chains (domestic, regional and international) have shown that the outcry on lack of markets could have contributed to a shift of focus from the core problem-i.e. inability to supply the market in terms of the quality required and reliability of supply expected by the buyer.

The reality on the ground is that farmers lack the skills and resources to identify new markets and the ability to take advantage of identified markets through value addition activities such as grading, cleaning, sorting, packaging, bulking, and primary processing.

>> continued page 18

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Competitive Collaborations By: Justin Stokes CCP cluster Advisor Supervisor

CCP is supporting activities to increase the competitiveness of Tanzania’s tourism, horticulture and food processing industries. Part of CCP’s objective is to foster more productive relationships among key stakeholders (business, government, academia and NGO) concentrated in the specific strategic locations in Tanzania, or industry clusters.

Tanzanian companies don’t just compete against other Tanzanian companies any more…

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s Tanzania’s economy opens to the region and the world, many economic opportunities are available for Tanzania, its people and its businesses: New markets into which to sell Tanzania products, new sources for inputs and raw materials, access to information and expertise that can be used to develop new products and services demanded locally. However, even as these new opportunities are presenting themselves, the opening of the Tanzania economy is also exposing Tanzania to competition from outside.

Low cost products from Asia, skilled and unskilled workers from across Africa, companies from Kenya and Uganda are all coming to Tanzania, bringing with them a relentless drive for higher quality at lower costs.

The ability of Tanzanian firms to compete is increasingly determined by how well companies within an industry can work together, and with government and supporting institutions, to solve problems and seize opportunities that are beyond the power of any one individual firm – issues such as the quality of the skilled workforce, the financial and administrative burden of regulations and fees, or the condition of common use infrastructure. At the national level and at the regional level, leadership from private sector, public sector and supporting institutions must come together in a meaningful way to solve common problems and pursue collective opportunities.

Industries in other parts of the world are doing just this. For example, in tourism, across the world, business and government are working together to create destination management organizations that collaboratively operate, market and maintain tourism attractions.

In its first year of implementation, alongside industry leadership, CCP analyzed the competitiveness of the three industries and developed a strategy and action plan to assist each industry in raising its competitiveness. CCP is now supporting the industry leaders at the national level and within key geographic clusters to

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implement the action plans.

each doing their part.

But, to achieve the true potential of the horticulture industry for Arusha, the parts need to be working together. Are the associations meeting consistently with the local government authorities to discuss and resolve issues that need government action? Do the Economic leaders in Tanzania often refer to the private training institutions understand the skills needs of sector as the “engine” of the economy. Even specific the horticulture firms? Are they training students industries, and their geographic clusters can be seen as that graduate with those skills? Can the farmers and engines that are driving Tanzania’s prosperity. In orexporters access reasonably affordable financing? der for the engines (clusters) to be producing at their

Greater than the sum of the parts, but only if the parts are working, and working together...

“To catch the reader's attention, place an interesting sentence or quote from the story here.”

potential, all the parts have to be present, working and Tourism in Tanga is an example of a less developed, working together. but emerging cluster. The basics of the engine are in place: a set of attractions, core group of hotels, resThe horticulture cluster in Arusha is a good example. taurants, and tour operators, and an increasing recHorticulture is a relatively developed cluster for Tanognition by the regional authorities of the potential zania, with a core concentration of productive firms, for tourism. But training institutions are limited and specialized supporting services, and institutions that not yet producing graduates that meet the need of support the industry. The cluster map below illusthe tourism industry. trates all the parts of the horticulture engine: various companies, institutions, associations, organizations, and projects that are working to support the growth of the Local suppliers for the hotels are limited, so even horticulture industry in Arusha. Are all the parts there the basic supplies (food, materials) are brought in from Arusha, Dar or Nairobi. Transport linkages and working as they should? Each of them has a specific role to play and the rest of the cluster depends on are also still underdeveloped, making it hard for tourists to get to Tanga easily.

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Recognizing the need to work together to solve common problems and support the region’s growth in tourism, tourism stakeholders in Tanga are organizing themselves and collaborating with government and training institutions.

Stakeholder meetings and working groups are only as effective as the industry linkages and collaboration that they foster…

Cluster collaboration is hard. It takes boundless energy, bottomless patience, and bold persistence. It is also a full time job. Formal, supporting institutions such as business associations, training institutions, and other organizations for collaboration are the key to sustainable collaboration in the industry.

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are unwilling to attend long and numerous meetings. The initiative falls apart. That’s why supporting institutions are so important.

Associations, training institutions and other service providers serve as the mechanisms through which the key players (public and private sector) can work together, over time, to address systemic constraints to productivity that cannot be resolved by individual firms. Recognizing the importance of these institutions to the long-term competitiveness of the industry, CCP has been working closely with key institutions to provide support and advice on strengthening the ability of each organization to deliver on its mandate. With both technical and financial support to institutional capacity building ongoing across horticulture, tourism and food processing, CCP is supporting these institutions to become catalysts for industry collaboration and cluster development.

The ability of any individual business owner to participate in, or lead a sustained effort of collaboration is unreliable. If business is slow or there is an urgent cluster related issue to resolve, attention will be high. But if business is busy, the reason and ability to collaborate disappears and interest in ‘common’ industry objectives weakens. Managers

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Tall. Full. Glass of Milk

By Mrs Rose Maeda CCP Food Processing Cluster Specialist

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n a recent meeting of the dairy processing cluster in Arusha, it was revealed that raw milk from Arusha is sold to Kenya (at market price or even less), which in turn they bring the dairy products to Arusha. Dairy processors claim to get inadequate milk for their factories while milk is flowing to Kenya. Does this really make any sense? Government and private sector should work together to ensure that Arusha processors can access the raw milk they need at market rates, so as to protect/ promote the country’s economy and enhance competitiveness and development of the dairy sector.

Livestock technical officers, institutions, service provider’s, associations, farmers and key stakeholders should join the effort and commitment to improve milk production at farm gate level to ensure adequate raw milk. Dairy processors on the other hand should focus on building the competitiveness of their businesses, ensuring that they can compete with other companies from East Africa.

The members of the dairy cluster in Arusha emphasized the importance of working together. However it was realized that the range of quality processed products supplied is limited and there is very little product development and innovation going on. CCP is supporting potential clusters, institutions and associations to strengthen their capacity to improve the food industry for economic competitiveness, growth, employment and poverty reduction.

Participants for the dairy cluster meeting in Arusha admiring the dairy products

It is important to highlight the problems associated with standards that typically hamper market expansion and exports to international markets. It is more important however to suggest simple solutions to these problems and provide information on the support that small food processor companies can receive to assist them with expanded domestic, regional and export markets, bearing in mind the increasing demand of consumers/importers.

The processing facilities and the technology employed by most of the small food processors are pathetic. Individual firms/companies thrive to improve through support from different partners.

CCP plan to support Arusha dairy cluster to enhancing the competitiveness and growth of the sector by increased productivity, improved quality of the products and hence increased the dairy sector’s domestic, regional and international competitiveness through, training, market linkage and provision of production equipment and sourcing of quality packaging materials.

CCP Interventions in Food Processing Industry: The Tanzania Cluster Competitiveness Program’s in Value chain and cluster mapping identified key constrains to development of Tanzania Food Processing sector as the ability of high growth small firms to access affordable, hygienic production premises, technical support and entrepreneurship skills. In collaboration with Institutions, consultants, partner organizations and other stakeholders, CCP is implementing a capacity building program aimed at increasing competitiveness of food processing, horticulture and tourist industries with the overall goal of enhancing market access,

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increased productivity and improved workforce.

CCP identified the opportunity and need to develop SMEs in food industry to access hygienic production and technical support so as to improve the quality and competitiveness of their products to reach regional and export markets. Among activities carried out is training of industry workers on issues of food hygiene, safety and quality, packaging and labeling and dairy technology. CCP developed strategic plans to assist clusters in food processing through improved production facilities, market linkages and technology transfer and strengthening identified potential clusters to increase their competitiveness, implementation process on progress.

Among the envisaged clusters include; Morogoro cluster, Arusha dairy cluster, Arusha Food processing Cluster, Mwanza fish processing cluster and Pemba fruits and spices processing cluster. Pemba is an emerging cluster with potential for growth. Mango farmers and processors cry for support to meeting export market in South Africa and they believe that CCP support will change their lives by increasing productivity and avails farmers, processors and the entire community with income.

Explore the immediate potential and uniqueness of Tanzania: Tanzania has a significant opportunity to compete in the global market for processed fruits, vegetables and other food stuffs. For this to happen, efforts should be directed to enhance production capacity effectively.

The potential that exists within Tanzania to produce its own food products should be fully utilized to process exotic fruits and food varieties required by domestic, tourists and export market before resorting to food imports. This is mainly the responsibility of government and private sector to ensure improved quality of production as well as the quality of value added products. There is a need for integrating and improving the food processing with the needs of tourist industry. External trade remains an important component of economic activity in Tanzania.

Who says weddings should be expensive, even with simple but appropriate technology could

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work.

For instant the potentiality of the Pemba Island as a tourist attraction and rich in varieties of fruits and spices create encouragement to support the private sectors activities in the sectors. Mango drying activities is one of the examples which require synergy and linkages between the government, developmental partners and the private sector being agro processing firms, hotels and tour operators should collaborate to develop the sector.

It only needs to be commitment and dare.

A farmer in Pemba exports 9 tons of dried mangos to South Africa in one harvest season

Racks driers technology in Pemba

Meeting between CCP and mango drying processes in

Rose Meade is the CCP Food Processing Specialist and Tourism Specialist Advisor at the TPSF Cluster Competitiveness Program. She has extensive experience on global tourism and tourism marketing strategies. Titled, Looking beyond East Africa, is a paper presented on behalf of CCP by Meade at the Symposium that was held to mark the celebration of 15 years of Cultural tourism in Tanzania. TACTO is one among other tourism organizations supported by CCP to raise competitiveness in tourism..

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Matching Grants In order to create an even distribution of support to clusters, we have offered grants to both Tanzania Mainland and Zanzibar. We have supported clusters in Arusha, Tanga, Morogoro, Dar es Salaam, Coastal region, Pemba and Unguja.

Eligibility Criteria

By Mr Gabriel Landa CCP Grants Manager

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he role of Tanzania Cluster Competitiveness Programme is, among other things, to support the development of clusters by offering grants to different projects that falls under Food Processing, Tourism and Horticulture. Supporting the clusters has been in building infrastructure base, institutional strengthening and capacity building.

The priority areas for most of the grants have been in supporting the programmes which enhances the clusters in technological innovations, development and transfer. Infrastructural activities supported include the construction of buildings for shared facilities, and procurement of processing equipments.

Institutional strengthening includes the cluster automation and all activities that involve the application of ICT. Another area includes the capacity building in form of organizing trainings in management, leadership development. All these supported have enhanced members of the clusters to conform and acquire local and international standards like TFDA, Global GAP, TBS, and Tourism Health & Safety Codes.

The programme has set aside a number of criteria which the clusters need to follow before applying for the grant. These includes among the following:

a)

Applications for registration will be accepted for local business development organizations, Universities and training institutions, business associations and National business groups, Private lead firms amongst a consortium with a significant impact on entire value chain and business support services providers.

b) Applicants must have prior experience working with multiple stakeholders in a particular industry, preferably in a support or assistance CCP Program cluster grants providing role. c)

Host Institutions must support will mainly be exbe Tanzanian entities legally constituted and tended primarily to Tanzanian in complete complinon- profit organizations alance with the laws of ready participating in the Tanzanian governing such entities. cluster d) The organisation must show evidence of availability of appropriately qualified staff and expertise to perform work contracted under the Tanzania cluster competitiveness program.

Eligible Organizations The priority areas for most of the grants have been in supporting the programs which enhances the clusters in technological innovations, development and transfer

a)

A Grantee organization must be a legally registered and recognized entity under the laws of the Republic of Tanzania.

b) CCP Program cluster grants support will mainly be extended primarily to Tanzanian non- profit organizations already participating in the selected/proposed cluster/ value chain, though appropriate for-profit organizations

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will also be supported. c)

menting the objectives related to the aims of CCP;

In certain circumstances grant support may be extended to Tanzanian for profit companies, such as Business Capacity Development organizations (consultancies) or companies in the selected clusters if they have the capacity to impact multiple companies in a value chain related to CCP activities. In such circumstances, joint ownership between consortium members within the clusters will be sought.

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Confirmation that the Applicant has not received any funding from CCP for the preparation of its Application;

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Demonstration /Memorandum stating that the Applicant has no outstanding written deliverables (older than 90 days) or disputed advances/grants from any TPSF related program (including Matching Grants and Business Development Gateway), or other Donor projects.

Individual firms/organizations participating in the

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Applicant must confirm or declare that if has any relationship with any TPSF/CCP or sister Donor projects member staff.

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Capability to segregate stakeholder data by gender and geographic location, and other means as may be required.

cluster/value chain will be considered if the grants impact multiple parts of the value chain

d) Individual firms/organizations participating in the cluster/ value chain will be considered if the grants impact multiple parts of the value chain and if the requested support is not covered under other TPSF programs (BDG and Matching Grants)

All applicants must demonstrate that they are eligible for a grant under CCP. Applications for grants under CCP must be submitted in a specific format . Any application submitted in any other format is not eligible for evaluation under the grants program and will be returned to the submitting organization. Eligibility criteria will generally include the following (and require proof thereof):

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The Applicant is an eligible organization legally constituted under Tanzanian law with a legal status;

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A management structure which includes appropriate staffing to undertake the activity;;

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Managerial commitment, as evidenced by a strategic plan or other documentation indicating that it will be imple-

Ineligible Organizations All those organizations that do not meet the requirements mentioned above will be considered ineligible to receive a Cluster grant from CCP.

Eligible Activities The proposed activities to be funded under CCP must promote overall objectives of CCP Project, as set forth above.

Gabriel Landa is the Business Cluster Development Practitioner. He is responsible for convening and facilitating grant selection committees; to disburse, track and monitor grant funds according to agreed procedures.

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Shrinking Markets

By Mrs Tertula Swai CCP Horticulture Cluster Specialist

The Case of Mangoes

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Tanzania is still unable to meet orders of mangoes from various international markets due small volumes produced. Following a mango tasting festival that was held in November 2010, a lot of requests were placed or information requested by local traders as well as International buyers on what varieties and volumes were available for sale.

The issue of volumes have also been a major obstacle preventing access to lucrative markets whether domestic or international.

It became apparent that AMAGRO was not in a position to meet domestic demand, let alone International markets.

Tanzania is still unable to supply the domestic market due to low production, lack of post harvest technology and storage facilities (lack of relevant infrastructure) to increase productivity, reduce wastage and produce during off season ( by irrigating, using high yielding varieties, high quality and recommended fertilizers and pesticides and technical know how on mango production).

typical marketing paradox is that buyers, such as supermarkets and processors, complain about inadequate supply while farmers complain about lack of markets. CCP’s experience of working with farmers involved in various horticulture supply chains (domestic, regional and international) have shown that the outcry on lack of markets could have contributed to a shift of focus from the core problem-i.e. inability to supply the market in terms of the quality required and reliability of supply expected by the buyer.

It is against this background that CCP has embarked on the cluster development approach, encouraging collaboration and partnerships between government, private sector and academia, deliberately facilitating the various chain actors to The case of Sweet Potatoes work together, individual and farmer groups to collaborate / partner to achieve economies of scale and ultimately Sweet potatoes are produced in Tanzania but during the exhibition, the buyers wanted a different type (orange be regarded as reliable suppliers. fleshed) and specific varieties of this type. For example Germany wanted a 20 ft. container every week. Israel companies The Tanzania Horticultural Association (TAHA ) reprewanted specific varieties of the orange fleshed which could sented Tanzania in this year’s FRUIT LOGISTICA in Berlin. not be available in the quantities required.

FRUIT LOGISTICA is the world leading trade fair for fresh produce, mainly fruits and vegetables, which attract more The case of avocadoes than 54,000 visitors from more than 132 countries around the world. It is an event which brings together trading partAvocadoes were among the most sought fruits with high ners across the globe and key decision makers in the fresh demand in Dubai, Kuwait, Israel, Spain, Germany and the produce industry.

UK. An Israel company, MTEX Group, indicated an interest of buying up to 50 tons of avocadoes a week. Other buyers Tanzania was among the 2,452 exhibitors from 84 counthat were ready to buy the Hass variety were South Africa, tries. The gist of participating in this show was to explore Kenyan company (East Africa growers). Farmers are faced market opportunities for fruits and vegetables from Tanza- with the problem of high freight costs, logistics (absence of nia and to promote investment opportunities available in relevant infrastructure at our ports , the country. Some of the experiences below were encountered by TAHA during the exhibition, whereby buyers were unable to get the quantities or varieties they wanted. Proper packaging material and absence of local processing

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industries. A famer from Njombe who had visited buyers in Dubai and Europe, was overwhelmed by the orders, but almost all buyers asked him similar question: i.e. whether he had a cold room as some wanted to visit his premise and train him on post harvest technicalities and how to handle the fruits so they can reach the market in the required state.

He was also asked whether he has a cold truck. He checked out the freight costs and realized that the margins were very small. He finally realized that he was not ready for those markets. He had tried to mobilize other farmers to increase the volumes, to date they are still relying on him to link them to the market he had promised.

He tells them until they get a cold room and truck, he can not take fruits from them.

The avocado growers need to be coordinated so that they can consolidate their production to be able to meet the orders from Europe and elsewhere.

The case of pineapples The buyers wanted MD2 and MD4 varieties which are required in the EU market. Tanzania farmers produce the smooth cayan variety.

The case of spices.

Although Tanzania had garlic and ginger of good quality (aroma), the buyers were specific on diameter, (of garlic) which means our producers need to use a grading machine to meet the market specifications. Some buyers wanted a 20 ft. container per week, but no one could supply this amount.

Companies processing spices say that they have to import cardamom, ginger and cumin, from Dubai, Ethiopia and Uganda as they could not get enough from Tanzania. This spices are part of the ingredients used in other spices.

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Other companies who had contract with buyers abroad have had to pay heavy fines for failure to supply the quantities agreed to in their contracts.

Some of the companies found lucrative markets in the USA, but on condition that farmers comply to NOP standards of the USA. Associations like Tanzania Organic Movement (TOAM) have capacity to provide the training to the farmers in preparation for inspection and certification by IMO from Switzerland. These companies are still looking for resources to train the farmers.

The same applies to the Japanese market, they need essential oils and spices but the exporters must meet the JAZ standard-this has to do with Internal Control systems , Quality Management Systems which neither the farmer groups nor the companies have in place.

The Japan Ministry of agriculture is ready to bring an expert to conduct the training, but the participants (farmers, companies) need to be coordinated to receive such technical assistance.

The examples above point to the need for increased government role especially on providing infrastructure, research and development , as well as training. Collaboration/ working by the government, private sector and academia needs to be supported to take the horti-

culture industry to the next level. As such, the coordination of the private sector , government and Academia should come out clear on the roles of each actor, accountability mechanisms and sources of funding.

There is a need to strengthen business support Units be it under TNBC, TPSF and Industry Associations. More resources are required to enhance research into new/non traditional crops that are required in certain niche markets.The Institutionalization of standards compels all actors to invest incompliance as this is a main market access barrier.

Investment in skilled farmers/workforce and science based businesses are among the key success factors and Key to competitiveness. This must go hand in hand with information packages on a variety of crops to guide investment decisions, plus linkage to sources of finance.

Tertula Swai is a seasoned horticulture expert who has dedicated her life's work to the finding ways of changing, improving and investing in farming across Tanzania and the greater East Africa. She is a member of the Tanzania Horticulture Association in addition to working with the Cluster Competitiveness Program.

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Strengthening Cluster partnerships THE CASE OF ZANZIBAR

By: Dr Felician Ifunya CCP deputy Team leader

T

o assist the private sector to achieve sustainable growth through stronger cooperation for public private sector development, the Cluster Competitiveness Program (CCP) has developed a holistic support towards its outcomes of Productive People; Competitive Companies and Stronger Business Environment. The Competitiveness Partnership (CP) is a structured mechanism, anchored on the highest practical level, coordinated by the secretariat and aims at facilitating the discovery processes by involving a balanced range of public and private sector actors in identifying, filtering, accelerating, implementing and measuring competitiveness actions including policy reforms.

The CP approach allows for more informed discussions (working groups, analysis, and international experience), brings all key parties to the table giving the discussions greater legitimacy and is centered on facilitation support of the Secretariat.

It is a partnership of the private and public in private sector development. Each party has to make a contribution to its success. The Private sector’s biggest contribution to CP - is their skill at scoping, analyzing, prioritizing, presenting and upgrading strategies/issues. Whereas the Public sector’s biggest contribution to CP is its capacity and willingness to engage with and respond to private sector on the substance of the proposals.

Some of the CP key success factors include i.

a Secretariat as “engine” (analytical, administrative, facilitation and outreach support)

ii.

takes on manageable number of targeted, upgrading strategies/ specific reforms.

iii.

filtering process used to prioritize issues, iv) right people are involved (“champions”),

iv.

Working Groups meet regularly and move discussions forward and

v.

rigor and consistency in defining and resolving issues

The CP has seven operational elements that include: i.

Mandate & institutional alignment,

ii.

Participation under what structure,

iii.

Individual “champions”,

iv.

Facilitation & management (Secretariat),

v.

Outputs (“hard”, “soft”),

vi.

Outreach and vii) Monitoring & Evaluation (how well are we doing)

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Senior Govt

(joint) Steering Committee

Outreach Info Sharing

Advocacy

Administrative Secretariat

Monitoring Recommendations

Under the CP approach, CCP is implementing the Zanzibar National Tourism Public Private Partnership Forum (ZNTPPPF). ZNTPPPF is a partnership between the government of Zanzibar (Public sector) and tourism related private sector organizations in Zanzibar (Private Sector). The parties have established the partnership (mandate) under the Memorandum of Understanding (MoU) that was signed on the 23rd October 2010 to work together for the achievement of a cluster vision “ a responsible, sustainable, culturally and environmentally friendly Zanzibar Tourism Sector aspiring to become one of the top destinations of the Indian Ocean, offering an up market, high quality product and through that process maximize the economic and social development of Zanzibar”.

The CP Structure

Attracting Support

Analytical Facilitation

Capacity Building

(joint) Working Groups

The Forum is structured with a joint steering committee, a secretariat supporting all the administrative functions of the steering committee and the working groups. Based on the value chain assessment that was conducted by the Cluster Competitive Program four joint workHerzberg , 2010 18 ing groups of workforce /service improvement, market and product development, business and investment environment improvement and institutional development where identified and upgrading strategies thereof developed.

The ZNTPPF MoU has established collaborative and effective partnership principles that include:

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discussion and resolution of constraints impeding the sector’s development as well as pursuing opportunities enhancing its development;

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building a foundation of trust and confidence that encourages both parties to explore best practice, emerging trends, new ideas and a better understanding of the challenges and issues facing the sector and also the players;

•

soliciting views and ideas aimed at developing appropriate policies, legislation and strategies to enable the creation of a conducive business environment in which international and domestic tourism will prosper and which will seek ways to minimise the costs of compliance to the sector in dealing with government;

•

addressing the sector’s competitiveness and in recognition of the wide variety of factors contributing to this objective; and allowing avenues for both the public and private sectors to constantly communicate, exchange information and ideas for

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The Zanzibar National Tourism CP Forum

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the betterment of the Sector.

Microeconomic Capacity Sophistication of Company Operations Strategy

Quality of the Microeconomic Business Environment

Corporate Governance Customer Orientation Management & Staff Training Entrepreneurship Training Production process sophistication Supply chain efficiency Delegation of Authority Family firm transitions Breadth of international markets

Efficient government processes Access to skilled labour Efficient financial sector Enforcement of contracts Local business environment Efficient infrastructure Market efficiency Access to technology Advanced research institutions

CCP has supported the working groups to conduct a Rapid assessment and each working group developed the following Strategic objectives:

Working Group i. Institutional Development

ii.

Business and investment environment improvement

iii. Market and product development iv. Workforce / service improvement

Strategic Objectives For PSO (Private Service Organizations): 1. Demand driven services are adequately managed to attract members/generating income 2. PSO Leadership and Management is Effective and Efficient 3. The Capacity of PSO and members to effectively engage in the Forums Improved For MDAs (Ministerial Development Agencies) 4. MDAs are Facilitating Private sector Development through Customer Charters 5. Regulations and administrative procedures governing fees relating to tourism reviewed and reforms proposed 6. PPP Law on utilities (BOT concept) proposed 7. Business community adhere to business ethics and Corruption prevented 8. Laws, regulations and Administrative procedure related to Tourism Compiled and disseminated 9. New Products and new Destinations are developed 10. Adequate Marketing strategies are developed and deployed 11. Zanzibar is adequately branded 12. Labor supply is not a constraint to growth in the tourism Sector 13. Skills and personal attributes to deliver quality experiences are developed 14. People with Experience and Expertise are Retained within the Industry because they have opportunities to grow

A total of 77 activities were developed to implement the for the 14 strategic objectives and the working groups are soliciting funds to support the activities.

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The Competitive Partnership has proved itself to build trust among the cluster partners and CCP is replicating the concept to other clusters, such as: the Tourism mainland with TCT members; the Fishing Industry/Cluster with the collaboration of Tanzania Industrial Fishing Processors (TIFPA); the Meat Industry/Cluster with the Tanzania Meat Board; and the Food Processing Cluster starting with building an alliance between the large processors (Confederation of Tanzania Industry (CTI) and small processors (TAFOPA and SCF are in the lead). It will focus on the public and the private sectors working together to improve the Microeconomic Capacity

Dr. Felician Ifunya, is the author of 'Improving the Investment Climate of Tanzania', a document he has presented at various conferences and forums across the world. As deputy team leader, of the TPSF Cluster Competitiveness Program, he is key to forging public and private sector partnerships to enhance the competitive edge of Tanzania's best performing sectors of the economy .

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TPSF Cluster Competitiveness Program Plot 1288, Mwaya Road, Msanani Peninsula P.O.Box 11313, Dar es Salaam, Tanzania Tel: +255 22 260 2245 / 260 2246 Fax: +255 22 2602237 Email: info@ccp-tpsf.org www.ccp-tpsf.org