Tanzania: Investments Lift Construction Sector

Dar Es Salaam — HEAVY investments in the construction industry has boosted the performance of the sector, which is growing faster than mining and tourism, officials said earlier this week.

The Contractors Registration Board (CRB) Registrar, Mr Boniface Muhegi, said the sector was now growing at between 12 and 15 per cent, up from 9.0 per cent recorded last year.

Mr Muhegi said mining and tourism which were heavily dependent on foreign sources have slowed down since the onset of global recession.

Mining and tourism were until 2007, the fastest growing sectors with an average growth of between 8.0 and 10 per cent annually.

The capital intensive mining sector has been facing financial doldrums with some projects closing down while others have scaled down production.

"After the global financial crisis, mining sector which is heavily dependent on foreign investment experienced credit crunch," Muhegi said.

The construction sector is currently contributing between 6 and 7 per cent to Gross Domestic Product.

Responding to a question as to where the construction sector is raising money to put up multistory building complexes in the commercial capital, the CRB chief said, "local banks which have not been hit by the credit crunch are responsible for financing the real estate."

One of the state-of-the-art over 10 storey office block which has just been completed in Dar es Salaam's central business district and is due to be opened next January, is an investment by British based property firm, Actis.

The office block which is a US$ 20 million (around 26bn/-) investment is built adjacent to Tanzania Development Finance Limited.

Actis Communications Manager, Claire Davies said the office block is almost leased out. "The space is almost fully leased out, but there is still some limited space available," Ms Davies said.

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Office space is increasingly becoming a problem in the commercial business district (CBD). The Actis building which is located where a four-storey parking block once stood, has worsened the problem of parking space for the city's motorists and the company is coming up with a solution.

"We are constructing a new park area to the rear of the site which will be completed in 2010. We have secured alternative parking for tenants in the interim," Davies pointed out.

One of the biggest projects touting the country's tallest building is Uhuru Heights. The 25-storey Uhuru Heights which is a joint project of Nida Textile Mills and Indian property giant, Cosmos will cost over US$ 50 million (over 65bn/-) when completed.

Next to Uhuru Heights is an 18-storey Viva Complex, a joint venture between Tanzania Red Cross Society and a local private property developer

Source:allafrica.com/