Tanzania’s Incomplete Border Markets Stunt Economic Integration and Local Growth

By Adonis Byemelwa

In the Kagera Region's Kyerwa District, plans for international strategic markets at Murongo and Nkwenda have faced significant setbacks, hampering efforts to promote cross-border trade and economic growth.

Initially envisioned as crucial trade gateways to Uganda, these markets aimed to empower local farmers by providing them access to larger markets for their agricultural products, particularly bananas. Nevertheless, despite the potential benefits, the projects have stalled due to budget constraints and administrative inefficiencies.

The Tanzanian government initiated this border market project under the Agricultural Sector Investment Project (DASIP), with funding from the African Development Bank. In the 2021/2022 financial year, the government allocated Sh500 million to assess and develop these markets, yet completion remains elusive.

As the government seeks to enhance economic growth, the situation raises critical questions about accountability, the effectiveness of budget allocation, and the need for strategic investment in local communities.

“The government must recognize that strategic investments like the Murongo and Nkwenda markets are essential for empowering farmers and enhancing their competitiveness,” said the former Sokoine University of Agriculture lecturer agribusiness and political analyst, Prof. Damian Gabagambi.

He emphasizes that border markets can significantly improve the livelihoods of smallholder farmers by opening doors to foreign markets, reducing transportation costs, and increasing income stability. "For many farmers, these markets represent their best chance for economic upliftment and food security,” he added.

The implications of failing to complete these markets are profound. Not only do they represent missed opportunities for local farmers, but they also reflect a broader challenge in Tanzania's approach to regional economic integration. Past experiences, such as the decline of the Tanganyika Packers meat processing plant in Dar es Salaam—once a symbol of local industry—serve as cautionary tales.

The plant was abandoned due to operational inefficiencies and is now repurposed as a church, showcasing what can happen when vital economic projects fail to meet their objectives.

Economic experts warn that neglecting projects like the Murongo and Nkwenda markets can perpetuate cycles of poverty and hinder sustainable development.

In response to MP Anatropia Lwehikila Theonest's inquiry regarding the timeline for completing the Murongo and Nkwenda International Economic Markets in Kyerwa District, Deputy Minister Hashil Abdallah highlighted the government's commitment to these projects.

“The government recognizes the critical importance of establishing strategic international markets to enhance trade and export opportunities for our citizens,” Abdallah stated, noting that these markets are being developed under the Agricultural Sector Investment Project (DASIP), financed by the African Development Bank.

However, he acknowledged that the completion has faced delays due to budget constraints. “To tackle these challenges, the government has assembled a team of experts to analyze the issues and propose solutions to expedite the completion of these vital infrastructures,” he concluded.

Other countries in the region have demonstrated that strategic investments can yield significant economic benefits. For instance, Kenya’s Export Processing Zones (EPZ) and Rwanda’s Special Economic Zones have become models for enhancing productivity, creating jobs, and attracting foreign investment.

In both cases, effective planning, streamlined regulations, and consistent funding have led to tangible economic outcomes. Kenya’s EPZs, in particular, have enabled local industries to thrive, increase export capacity, and foster economic growth by providing a framework for businesses to operate competitively in the global market.

In contrast, Tanzania's ongoing challenges emphasize the need for better governance and strategic planning. The delays in completing the Murongo and Nkwenda markets are symptomatic of a broader issue: a lack of accountability and focus on long-term development goals. Without proper oversight, projects can falter, leading to lost investment opportunities and diminished community trust in government initiatives.

“The time for talk is over; what we need now is action,” asserts Agnes Elias Hokororo, a special seats Member of Parliament who has consistently advocated for reviving local industries, such as cashew processing in Masasi and Newala. “Farmers deserve access to markets that can enhance their livelihoods. If we can invest in these strategic border markets, we will see a transformation in our agricultural sector.”

The government’s commitment to completing these markets could catalyze broader economic changes in the region. By empowering local farmers, increasing trade, and attracting investments, Tanzania can position itself as a key player in East Africa’s agribusiness sector. Experts argue that the benefits would extend beyond economic gains; they would contribute to reducing poverty and enhancing food security, which is crucial for sustainable development.

Moreover, the need for collaboration between various stakeholders cannot be overstated. The government should work closely with private sector players, local farmers, and international partners to secure the necessary funding and expertise to complete the Murongo and Nkwenda markets. Establishing public-private partnerships could provide the financial backing required while fostering innovation and efficiency in project execution.

The road ahead for Tanzania’s border markets is fraught with challenges, yet the potential rewards are substantial. With effective management, transparent governance, and a focus on strategic investments, Tanzania could avoid the pitfalls experienced by past projects and pave the way for a more prosperous future. The lessons learned from countries that have successfully harnessed their agricultural potential serve as valuable blueprints for Tanzania’s path forward.

All and sundry, the ongoing situation regarding the Murongo and Nkwenda markets encapsulates a critical moment for Tanzania. As the government grapples with the complexities of development and economic growth, it is imperative to prioritize the completion of these strategic projects.

By completing the Murongo and Nkwenda markets, Tanzania stands at the brink of a transformative opportunity to unlock the economic potential of its border regions, empower local farmers, and cultivate sustainable development that uplifts all citizens.

The success of these markets could indeed set a powerful precedent for future initiatives, further enhancing regional trade and economic integration across East Africa.

In a recent statement, Minister of Industry and Trade Selemani Jafo emphasized the government's commitment to ensuring that these projects not only see completion but thrive, noting, "Investing in our border markets is investing in our future. We are dedicated to creating an environment where local farmers can flourish and contribute to a vibrant economy."

Minister of Agriculture Hussein Bashe echoed this sentiment, stating, “These markets are critical for enhancing our agricultural sector. By connecting farmers with broader markets, we’re not just boosting incomes; we’re nurturing food security and strengthening communities.”

Moreover, the role of public-private partnerships (PPP) is pivotal in this context. David Kafulila, Director of the Public-Private Partnerships Unit, remarked, “Collaboration between the government and private sector stakeholders is key to overcoming the challenges we face. Together, we can leverage resources and expertise to ensure that these markets become thriving centers of commerce that benefit our farmers and the economy as a whole.”

The call to action is clear: with robust support from the government, effective partnerships, and a focused strategy, Tanzania can elevate its agricultural landscape and economic prospects. The completion of the Murongo and Nkwenda markets promises not only to invigorate local economies but also to position Tanzania as a competitive player in regional trade. The time for decisive action is now; the future of countless farmers and the prosperity of border communities depend on it.