Adherence to and Reinforcement of ‘Local Content’ Policies in the Tanzania’s Extractive Sector: Review of the Key Strategy and Regulatory Requirements for the Transformation of Tanzania’s Liquefied Natural Gas (LNG) Industry

Dr. Cristina D’Alessandro and Prof. Franklyn Lisk (2020). Adherence to and Reinforcement of ‘Local Content’ Policies in the Tanzania’s Extractive Sector: Review of the Key Strategy and Regulatory Requirements for the Transformation of Tanzania’s Liquefied Natural Gas (LNG) Industry. UNU INRA.

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  • Author Dr. Cristina D’Alessandro
    Prof. Franklyn Lisk
    Title Adherence to and Reinforcement of ‘Local Content’ Policies in the Tanzania’s Extractive Sector: Review of the Key Strategy and Regulatory Requirements for the Transformation of Tanzania’s Liquefied Natural Gas (LNG) Industry
    Volume/Issue No. 2021/1
    Publication Date 2020-11-09
    Place of Publication Accra
    Publisher UNU INRA
    Pages 26
    Language eng
    Abstract A significant increase in the dependence on extractive resources (minerals, oil and gas) for national development in Tanzania has resulted from the discoveries of very large quantities of natural gas, mostly offshore during the past decade. There are both opportunities and challenges involved in utilising these new sources of resource wealth. The aim is to achieve inclusive and sustainable development, in line with the strategies and pathways for economic and social transformation sketched out in the Tanzania Development Vision 2025 (TDV 2025). In the light of the high level of extractive dependence, the transformation of Tanzania into a middle-income country within a decade – as explicitly stated in the TDV 2025 – will depend on the strengthening of economic linkages between the extractive and other sectors of the economy. It will also depend on the creation of valueaddition capacities within the extractive and primary production sectors. It is in this regard that ‘local content’ policies, especially in the extractive sector, assume the crucial role of the main driver and foundation for economic transformation and development. Such policies are designed to stimulate the use of local elements of production, such as labour, capital, and the supply of goods and services, to create value in the domestic economy and hence promote industrial development. The article will critically review the evidence of Tanzania’s interventions and outcomes with respect to local content policies, aimed at creating conditions to take advantage of the opportunities that are opening up for the participation of Tanzanian-owned entities as a consequence of the new oil and gas discoveries. In a wider context, the article will explore local content interventions to foster economic diversification and industrial development. Specifically, and against the background of existing Tanzanian legislation and its institutional setting, it will provide and analyse an update on relevant developments in the policies and regulations pertaining to capacity-building; the transfer of technology; innovative and transformative partnerships; the procurement of locally-produced goods and services; in-country downstream production and manufacturing; and local and regional supply and value chains. The article will end with some main conclusions and recommendations for successful local content policies towards maximising the returns and benefits from natural resources endowment.
    Copyright Holder UNU INRA
    Copyright Year 2020
    Copyright type All rights reserved
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    Created: Fri, 26 Nov 2021, 22:03:31 JST by Elijah Worthy on behalf of UNU INRA