The government has issued five key directives aimed at improving the efficiency and financial performance of companies in which it holds minority shares.
The directives, announced during a three-day meeting in Kibaha, Pwani, emphasize digital transformation, good governance, profitability, collaboration with the private sector, and alignment with national economic priorities.
Speaking at the meeting, Minister of State in the President’s Office (Planning and Investment), Prof. Kitila Mkumbo, challenged board directors of these companies to implement strategic measures that would optimize their operations and maximize returns.
“We must develop robust strategies to enhance the performance of companies under our oversight,” he stated, urging the executives to take proactive steps.
According to the Treasury Registrar’s Office, which oversees 308 institutions—including 56 companies where the government has minority ownership—a total investment of TZS 86.3 trillion has been made.
Of this, TZS 2.9 trillion has been invested in minority state-owned companies, while TZS 83.4 trillion has been allocated to fully state-owned institutions.
Prof. Mkumbo highlighted the need for tangible outcomes from these investments, noting that revenue contributions from these firms to the government have grown substantially.
Over the past five years, dividends from these companies increased by 236%, rising from TZS 58 billion in the 2019/20 financial year to TZS 195 billion in 2023/24.
He attributed this growth to government-led economic reforms and called for sustained efforts to further boost non-tax revenues from state-owned enterprises.
Government efforts are geared toward increasing non-tax revenue contributions from 3% to 10% within the next five years.
Prof. Mkumbo also acknowledged the positive role played by companies that consistently contribute to the government’s Consolidated Fund and urged others to follow suit.
In reinforcing the government’s commitment to improving the business climate, the Permanent Secretary in the President’s Office (Planning and Investment), Dr. Tausi Kida, announced plans to launch the second phase of the Business Environment Reform Blueprint.
“We aim to identify and address existing challenges to stimulate investment and economic growth,” she said, underscoring the importance of a conducive regulatory framework.
Treasury Registrar Nehemiah Mchechu emphasized the role of technology in data-driven decision-making and operational efficiency.
He aligned these reforms with the ‘R4’ philosophy championed by President Samia Suluhu Hassan, which focuses on Reconciliation, Resilience, Reforms, and Rebuilding.
According to Mchechu, digital transformation is particularly crucial in driving the ‘Reforms’ and ‘Rebuilding’ components of the philosophy, ensuring that Tanzanian companies remain competitive in the global economy.
The meeting, which gathered approximately 150 stakeholders, provided a platform for in-depth discussions on how board directors can leverage technology to enhance efficiency.
Director Lightness Mauki from the Treasury Registrar’s Office further noted that dividends from minority state-owned companies have grown by an average of 50% per year over the past four years.
She expressed optimism that these contributions could double in the current financial year, given recent positive financial trends.
To support these objectives, the government launched new corporate governance guidelines outlining the responsibilities of board directors.
These guidelines are expected to enhance efficiency and strengthen the financial contributions of minority state-owned companies to national development.
The directives come at a time when Tanzania is actively promoting investment-friendly policies and economic diversification. As state-owned enterprises navigate this evolving landscape, the government remains committed to ensuring that its investments generate maximum returns and contribute significantly to national growth.