The International Monetary Fund (IMF) yesterday endorsed President John Magufuli’s efforts to tackle corruption, but said more needs to be done to reform the country’s economy and improve the financial sustainability of the state-run Tanzania Electric Supply Company Ltd (TANESCO).
Magufuli (pictured) has been spearheading a concentrated campaign to root out high-level corruption and inefficiency in government since assuming office in November last year, with several top public officials already unceremoniously removed from their positions as part of the crusade.
The IMF mission chief in Tanzania, Hervé Joly, said in a statement the international lender of last resort welcomed this ongoing purge, describing it as a “strong drive against corruption.”
“…It (will) help address the perception that governance (in Tanzania) had deteriorated in recent years, as suggested by a number of surveys,” Joly said. Businesses have long cited corruption and government inefficiency as major obstacles to investing in Tanzania, which ranked 117 out of 168 countries in Transparency International’s 2015 index of least corrupt countries whereby no. 1 is deemed the least corrupt.
But according to the IMF, the Magufuli administration also needs to carry out other “vigorous reforms” to foster further structural transformation of the economy and sustain high productivity gains and investment.
“Improving the business environment is also a priority. This includes, among others, better energy and transportation infrastructure and improving access to land and finance,” Joly’s statement said.
“Further improving the financial sustainability of the public electricity utility, TANESCO, and settling outstanding arrears on gas and electricity supplies are critical to facilitating continued private sector investment in energy,” it added.
Senior public officials who have been dismissed as part of Magufuli’s anti-graft drive include the chief executive officers of the Prevention and Combating of Corruption Bureau (PCCB), Tanzania Revenue Authority (TRA), and Tanzania Ports Authority (TPA).
They are just samples of a wider crackdown that has seen many other big heads roll across the entire government and public sector spectrum.
According to the IMF, Tanzania’s economy remains buoyant and inflation will likely remain in check, helped by lower global oil prices.
“Preliminary estimates suggest that GDP (gross domestic product) grew by 7 per cent in 2015, with activity particularly buoyant in the construction, communication, finance and transportation sectors,” the statement said.
Economic growth is expected to remain close to 7 per cent in 2016, it added, with inflation remaining in single digits at a 5.6 per cent average throughout 2015 despite a “significant” exchange rate depreciation in the first half of the year.
According to the IMF statement, inflation is expected to decrease further in the coming months, remaining close to the medium-term target of 5 per cent.
Meanwhile, Tanzania’s annual headline inflation rate eased in February to 5.6 per cent from 6.5 percent in January due to slower rises in food prices.
SOURCE: THE GUARDIAN
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