President William Ruto’s two day state visit to Tanzania culminated in a historic address to the country’s parliament with an appeasement to build a strong economic partnership.
In an effort to mend the mistrust that has existed between two of the largest economies within the East African Community, President Ruto called for stronger ties which will support economic growth, job creation for the youth and enhance regional intra-trade which currently stands at 15-20pc.
“The time has come for our generation to move beyond incremental progress towards decisive integration because our biggest barrier is not infrastructure or policy, it is the quiet mistrust that pervades our relations. That suspicion has cost us time, opportunity and prosperity and we can no longer afford it,” said President Ruto.
The visit comes amid quiet tension that has existed between the two neighbouring countries often coming to surface as the border points.
In a move aimed at enticing investors, the president called for stronger economic cooperation with Tanzania backed by recent investments by Tanzanian companies in Kenya within the last three years.
Among Tanzanian companies that have acquired interest in Kenyan include Taifa Gad which established a plant in Mombasa, Amsons Groups which acquired Bamburi Cement and Taarifa Limited owned by billionaire Rosatam Azziz which acquired majority stake in Nation Media Group from Aga Khan Fund for Economic Development (AKFED).
“These are companies that have invested in Kenya over the last three years. With recent strategic investment from Tanzanian investors in Kenya, I expect this value of investments to more than double by the end of this year,” said Ruto.
Currently, total investment by Kenyan firms in Tanzania amount to at least Ksh 219 billion ($1.7b) which have supported job creation, skills transfer and strengthening of local capacity in various sectors including manufacturing, energy, logistics, financial services, and agriculture.
On the other hand, Tanzanian investments in Kenya have grown in recent times to reach Ksh 43 billion spanning media communication, energy and manufacturing.
“These cross-border investments are not merely flows of capital; they are powerful catalysts for expanding trade. The deepening interdependence of our manufacturing and agro-processing sectors is driving sustained demand for raw materials, while spurring investment in value addition and integrated supply chains for export,” President Ruto told Tanzanian legislators.
According to official data, bilateral trade between the two nations is currently valued at an estimated Ksh 111B ($860m) and is expected to reach Ksh 120 billion this year with sustained investments.
In an effort to ensure the two countries maximize opportunities under the African Continental Free Trade Area (AfCFTA), the president further urged for stringer investment cooperation to realize capital intensive regional projects.
These include the planned expansion of railway connectivity from Voi through Singida and onwards to Burundi to open regional hinterlands and unlock new trade routes and markets, and the proposed Shinyanga-Mabuki-Kilgoris- Rongai power interconnector will is expected to expand transmission capacity, strengthen the Eastern Africa Power Pool.
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