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Investment Policy Review The case of Tanzania

Investment Policy Review The case of Tanzania

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Investment Policy Review The case of Tanzania

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  1. Investment Policy ReviewThe case of Tanzania Massimo Meloni & Alexandre de Crombrugghe Investment Policy Reviews section DIAE / UNCTAD UNCTAD Virtual Institute Study Tour (University of Dar-es-Salaam) Palais des Nations, Geneva, 24 February 2010

  2. Structure of the presentation • Why is FDI important • What is an Investment Policy Review • The case of Tanzania

  3. Why is FDI important?

  4. Global FDI inflows, 1980 – 2008 (billions of dollars) Source: UNCTAD

  5. FDI is the largest source of external finance to developing countries Net capital flows to developing countries, 2000 - 2009 (billions of dollars) Source: UNCTAD

  6. FDI’s growing role in the world economy • > 80,000 TNCs • > 800,000 foreign affiliates • Foreign affiliates account for some 1/3 of world exports • In 2008, TNCs employed about 77 million workers (19 million in 1982) • FDI as % of Gross Fixed Capital Formation in the world in 2008: 11.5% • TNCs dominate world industrial R&D Challenge: to take advantage of TNC activities for development objectives

  7. What is an Investment Policy Review (IPR)?

  8. Focus of the IPR programme • Making FDI work for development • Maximize the contribution of FDI to achieving national development goals • Minimize potential risks or adverse consequences • Using the three pillars of intervention of UNCTAD • Research and analysis • Consensus building and experience sharing • Technical assistance

  9. IPRs – A five-phase programme

  10. Key elements of the advisory report • I. Past FDI trends and impact • Provides background and framework for analysis • II. Policy and regulatory framework • Review of investment framework: FDI-specific measures, taxation, labour, environment, sectoral regulations, competition and others • Recommendations: prioritized, concrete, actionable, coherent and with strategic orientation • III. Country-specific FDI strategy • IV. Findings, recommendations and action plan

  11. Achievements of the programme so far • 28 IPRs completed worldwide • 4 IPRs presented at intergovernmental meetings in 2009 • 3 IPRs in progress • 17 countries benefited or are benefiting from assistance • 27 requests pending to undertake an IPR • Heiligendamm G8 Summit Declaration • Ministerial Conference in Accra, Ghana (April 2008)

  12. The case of Tanzania

  13. FDI inflows to Tanzania and comparator economies 1990 - 2008(millions of dollars) Source: UNCTAD

  14. Focus of the IPR Tanzania Enhancing the role of FDI in development and increasing its technological impact • Assessment of Tanzania’s FDI potential • The IPR has assessed Tanzania’s major strengths and weaknesses in attracting FDI at country, sector and firm levels • Tanzania is an attractive FDI location with untapped potential, especially in mining & natural resources, agriculture & agribusiness, and tourism sectors • Policies and actions to realize potential

  15. IPR key recommendations 1. Strengthening tne investment framework 2. Reducing the cost of doing business 3. Ensuring continued success of privatization 4. Implementing effective infrastructure development

  16. IPR key recommendations 5. Stimulating human resource development and linkages 6. Building a dynamic enterprise sector 7. Enlarging markets through regional integration 8. Imparting a new strategic thrust to investment promotion

  17. Implementation Report • Evaluate to which extent the IPR recommendations have been implemented • Analyze the reasons for the non-implementation of some recommendations, if any • Assess the progress made in terms of FDI promotion • Suggest additional measures to further improve the investment framework

  18. Investment Policy ReviewThe case of Tanzania THANK YOU! Visit our website: www.unctad.org/ipr