Venture capital seen crucial for development


The venture capital and private equity investment financing industry has been hailed as an initiative that will substantially contribute to further strengthening the country’s private sector.

Investment and Empowerment Minister Mary Nagu

The Minister of State in the Prime Minister’s Office (Investment and Empowerment), Dr Mary Nagu, said in Dar es Salaam recently that given numerous investment opportunities in various sectors of the economy, the need for Tanzanian experts in the initiative cannot be overemphasised.

Dr Nagu who was the chief guest at the “Consultative Seminar on the Expansion of Venture Capital and Private Equity Investment Financing in Tanzania” reaffirmed the government’s commitment to ensure that the private sector is empowered to play the leading role in propelling economic growth.

“The government is implementing a number of regulatory reforms in support of private sector development,” she said.

Nagu said in ensuring that Tanzania makes the most of the investment opportunities, it requires continued action that is focused on improving business and investment climate with due attention to sustainability and inclusive nature.

“We must work together to sustain the progress achieved so far, with the view to leveraging the domestic private sector involvement in economic activity,” she noted.

She called on the private sector to improve the competencies and performance in the key sectors in which Tanzania has comparative and competitive advantage.

The seminar, whose theme was ‘opportunity for accessing non-banking investment financing’ was organised by Tanzania Private Sector Foundation (TPSF) in collaboration with TMS Consultants Ltd, a Dar es Salaam-based consulting firm with experience and knowledge in investment financing with venture capital and private equity investments.

According to experts, Venture Capital and Private Equity Investment Financing offers one of the opportunities for accessing non-bank investment financing.


Earlier, the TPSF Executive Director, Mr Godfrey Simbeye, said Venture capital and Private Equity Financing Industry is important to Small and Medium Enterprises (SMEs), because of its ability to attract large amounts of capital, advanced technology, new markets and professional management teams.

He said Joint Ventures have been an important business tool in the industrialisation of developing countries by associating with companies from the developed world with those of the Local Companies.

Explaining further, he noted that the foreign party usually contributes its share capital in cash, or as imported equipment and technology, entrepreneurship and management knowledge and skills as well as expanded markets.

“The local party usually contributes its share capital by providing land where the business investment will be made and an existing business which is normally to be expanded by the joint venture entity,” he said.

Giving an example, he said African countries such as Kenya, Nigeria and South Africa have benefitted from such arrangement and that there is no reason why it cannot be applied in Tanzania. “If successfully rolled out, this will help a lot in developing the country’s private sector,” adding that it will assist the country attain Vision 2025.

The seminar laid ground for the coming international conference of ‘venture capital and private equity in Tanzania slated for November this year and establishment of the proposed Tanzania Venture Capital and Private Equity Association (TAVCA).

Various papers from local and international experts were presented plus discussions and the way forward on matters pertaining to venture capital in Tanzania.

Source Tanzania Daily News

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