Tanzania: output by small businesses drops by a half

	The persisting electricity supply crisis in Tanzania is adversely affecting large and small businesses alike as a matter of course – and is crippling the economy as a whole GENERALLY speaking, the output of small businesses and producers in Tanzania has fallen by almost a half over the last few months, largely because of the prolonged power crisis.These include small industries involved in agro-processing, hair-dressing salons, tailoring, small scale miners, tie-and-die textile manufacturers and a myriad other businesses in production and  services provision. The  director-general of the Small Industries Development Organisation (SIDO), Mike Laizer, told Business Times in an exclusive interview that this has also resulted in considerable job losses among small-scale entrepreneurs across the country. “Small business owners have no alternative in the face of this problem – with the possible exception of closing down operations! This is because using fuel (for private power generators) increases costs by three times what they spend on energy from the national grid,” he said. In the event, Laizer called for the Government to install high capacity electricity generators which would immediately resolve the power problem. Giving his views on the power crisis, the executive director of the Tanzania Private Sector Foundation (TPSF), Dr Evans Rweikiza, said it would be prudent for the Government and other stakeholders in the private sector to sit together and thrash out ways and means to effectively and finally sort out the crisis. Noting that TPSF and the Government are expected to get together and discuss how to resolve the power shedding problem that is ruining Tanzania's economic prospects, Laizer said the meeting will seek to establish whether or not the Government alone can really solve the issue of power shedding in Tanzania. “What we want to do is to top up the Government's good plans  aimed at ending this mess,” he said. “I believe everyone will put this as a first priority because it is a national disaster!” The 'National Finance & Administrative coordinator of the Tanzania Consumer Advocacy Society (TCAS), Ali Goronya, told Business Times that many people have already lost their jobs, including those involved with the GATEWAY Entrepreneurship programme  sponsored by SIDO. “These are producers of soaps, tie-and-die textiles... They depend on electricity from the national grid. They cannot afford to purchase generators and the only 'option' they had was to indefinitely usprnd their income-generating activities,” Goronya said. Noting that “most small-scale hair dressing salon owners have already closed business, and some of them have perforce become commercial sex workers,” Goronya stressed that this is due to the severe power shedding which lasts for up to 18 hours a day! “Oil prices are high, and consumers are among the major victims of this, as producers and traders are passing the costs on to hapless consumers,” he said. TCAS plans to conduct a public rally in collaboration with 'Aim For Human Rights,' industrialists and other stakeholders to demand that the Government resolves the power problem immediately. Commenting on the problem, the TCAS executive director, Bernard Kihiyo, said his Society has received 1,869 email messages centring on the power crisis, and calling on the Society to urge the Government to find a solution t the problem sooner than later. “We need to have an immediate solution that is long-term, and involving Songas, Stieglers Gorge, solar power, wind power... The Government really needs to invest in energy sector cery seriously,” he stressed. For his part, the Mwanga Community Bank (MCB) managing director, Abby Ghuhia, said the bank is spending an average of  Tsh3 million a month to purchase fuel for a standby generator. This is costly vis-a-vis the bank’s operations. Mukula Brian, a barber, said “the power issue has caused us disproportionate harm. My earnings have plummeted as a result of the power crisis, compared to the time when power supplies were normal. I had never found the need to have a generator at my saloon but I was forced to purchase one so as to keep me working during the time of no electricity. But, the cost of fuel for the generator is  financially debilitating! “I normally charge Tsh2,000 to shave a head; but, due to the added costs for generator fuel, I am forced to charge Tsh3,000 per head. Even then, customers nowadays only come when there is power from the national grid, and they only have to pay Tsh2,000. This leads to scarcity of clients when the power is off. If  the Government does not intervene soon enough, the economy at the household and national levels will go kaput,” Brian laments. He said he cannot operate without electricity because some of the requisite hair dressing inputs such as syrup must be kept under refrigeration. He also carries out laboratory services that require the use of a microscope, and adequate lighting is essential for  data compilation. “Unfortunately, in times of power blacks-out, I cannot perform such services and, therefore, I get no clients.  The day’s sales keep shrinking as the power crisis becomes more severe”. Shop attendants are also not left out of the crisis where their businesses need electricity supplies. Mangi Shangi said furiously, “I am forced to sell unrefrigerated drinks because I cannot afford a generator to cool the drinks during power failures, said one kiosk operator, 'Shangi.' “Dar es Salaam is a very hot place, and people prefer a cold drink, I do not as many customers nowadays since my drinks are not cold. This TANESCO issue has become a sad, sad story of the day every day that passes and I don’t know when this calamity will end!” Rose Mshana of Rossela Hairdressing Salon in Dar es Salaam says power shedding has forced her to close her salon. “We had been using generators, but running them is too costly...” she said. “We spend more than Tsh30,000 per day on them – and we have loan to repay. This is a mess!”