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Tanzania Proposed 3rd Five Year Development Plan 2021/22-2025/26 – All You Need to Know

Tanzania Proposed Development Plan 2021/22-2025/26

The recently appointed new Minister of Finance of Tanzania Dr. Mwigulu Lameck Nchemba has recently presented to parliament the country’s proposed Third National Development Plan 2021/22-2025/26 (FYDP III).

In his speech, the Minister spelled out the objectives of the Plan and the priority areas.

Objectives of FYDP III

(i) Increases the GDP annual growth rate from 6% in 2021 to an average of 8% by 2026;
(ii) Increases internal revenues from 15.9% of GDP in 2021/22 to 16.8% in 2025/26;
(iii) Inflation to remain low between 3.0% and 5.0% over the medium term;
(iv) Foreign exchange reserves to meet the requirements of imports and foreign service for a period of not less than four months; and
(v) The creation of eight million new jobs in the private sector between 2021 and 2026.

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Priority Areas of FYDP III

(i) Stimulating a Competitive and Participatory Economy

This area includes projects that will focus on: building a competent community of regional and international competition; stimulating the stability of economic indicators; strengthening the business and investment environment; stimulating foreign technology transfer; and developing railway infrastructure and services, roads, bridges, water and air transport, ICT, energy, ports and airports and airlines.

(ii) Strengthening Industrial Production and Service Delivery Capacity

This area includes industrial projects aimed at adding value to agricultural, livestock, fisheries and mining products as well as products that will use the raw materials and resources available in the country. In addition, this area also includes projects and targeted programs to improve tourism, finance and insurance services.

(iii) Promoting Investment and Trade

This area includes initiatives which will strengthen local markets and take advantage of regional and international marketing and business promotion opportunities. Marketing will target national products, including those from agricultural, livestock, fisheries and forests.

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(iv) Stimulating Human Development

This area includes the implementation of projects that focus on improving people’s lives including: education and training in general; health and social welfare; social protection; water and sanitation services; town planning, housing and housing development; and mitigating the impact on climate change.

(v) Human Resource Development

This area includes programs and strategies aimed at developing the knowledge and skills of human resources in the country, from pre-primary to tertiary levels including enabling young people to become self-employed. Similarly, this area includes steps for improving the provision of vocational education and technical training to increase productivity and the competitiveness of the citizens in using the resources available in the country to bring development.

Key Projects of FYDP III

The Proposals for the Third Five Year National Development Plan 2021/22 – 2025/26 will include the development of key construction projects:
-the Julius Nyerere 2,115 MW hydroelectric power plant; the 358 MW Ruhudji hydroelectric power plant; the 222 MW Rumakali hydroelectric power plant;
-the Standard Gauge Central Railway;
-the Liganga coal and iron ore mines, including the construction of the Standard Gauge Railway from Mtwara to Mbambabay and the branches of Mchuchuma and Liganga;
-the crude oil pipeline from from Hoima in Uganda to Tanga in Tanzania);
-the Lindi liquefied natural gas (LNG) plant;
-the Magadi Soda Project;
-the Kigongo-Busisi high bridge in Mwanza and roads in Dar es Salaam;
-the fishing port of Mbegani;
-the Mkulazi sugar factory;
-Special Economic Zones.

It will also include the development of Air Tanzania (ATCL), the mining of nickel, and oil exploration in the blocks of Eyasi Wembere and Mnazi Bay North.

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Recommendations for FYDP III

The Book of Recommendations for the Third National Development Plan is divided into eight chapters:
1) Chapter one is an introduction that explains the origins and history of Tanzania’s Development Vision 2025;
2) Chapter Two deals with the review of the Implementation of Second National Development Plan 2016/17 – 2020/21 which forms the basis for the preparation of the Third Plan ;
3) Chapter Three focuses on industry and private sector development issues;
4) Chapter Four describes the concept of building a competitive economy, industrial and human development;
5) Chapter Five specifies the steps to be taken in the priority areas of the Plan;
6) Chapter Six deals with funding for the implementation of the Plan;
7) Chapter Seventh refers to the implementation of the Plan; and
8) Chapter Eight deals with monitoring and evaluation of the implementation of the Plan.

In March 2021, Tanzania’s Minister for Legal and Constitutional Affairs Dr. Mwigulu Nchembafor presented the budget proposal for the fiscal year 2021/22 to the National Assembly.

2021/22 will be the first year in the implementation of the 3rd Tanzania Five-Year Development Plan (FYDP III).

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