Agriculture & Health Care Equipments Manufacturing (made for Tanzania)

AGRICULTURE & HEALTH CARE EQUIPMENTS MANUFACTURING

[EIRI/EDPR/4689] J.C.: 2906TSH

TANZANIA OVERVIEW

Tanzania is one of Africa's fastest growing economies, with diverse natural resources and a youthful population. USAID helps empower women and youth who are essential to the country's continued development but are among the most marginalized citizens. Women's salaries, for example, are on average 63 percent lower than those paid to men, while female-owned businesses make 2.4 times less profit. Youth under age 15 make up 45 percent of the country's population of 55 million. Increasing access to economic and educational opportunities for young people will go a long way in helping ensure prosperity for all.

OPPORTUNITIES

BUDGET OVERVIEW

Despite the economic challenges born from Russia’s war on Ukraine, an increase in commodity prices, and a stronger American dollar, the Tanzanian economy performed satisfactorily in 2022. President Samia Suluhu Hassan’s administration looks to sustain the growth nurtured throughout the implementation of the country’s 3rd Five-Year Development Plan (FYDP III) 2021/22 – 2025/26, while tackling the obstacles facing the economy. Real GDP growth was 4.7% compared to 4.9% in 2021. The growth of the GDP was mostly driven by agriculture (15.6%), construction (11.8%), and manufacturing activities (8.1%). In 2023, the GDP is projected to grow by 5.2% - catalyzed by growth of credit to the private sector, improving business and investment conditions, and the continued rebounding of the tourism sector.

KEY SECTOR HIGHLIGHTS

Agriculture – the 29.2% increased budget allocation to the Ministry of Agriculture should allow for reduced farming costs through subsidies, agricultural infrastructure development, improved productivity, seed production, and irrigation research.

Energy – strategic priorities include the National Grid Stabilization Project, the finalization of LNG project negotiations and the beginning of preparations for its implementation, and the improvement of the infrastructure for receiving, unloading, storage, and delivery of fuel in the Ports of Dar es Salaam, Mtwara, and Tanga.

Mining – several signed framework agreements and issued special mining licenses mean that there will be an uptake of mining activity in Tanzania in the medium term. The value of mineral exports rose by 20.1% in Q1 of 2023, compared to its corresponding period in the year before. New mining projects include gold, nickel, graphite, and rare earth minerals.

Infrastructure – various airport modernization projects are underway, with a focus on Dar es Salaam, Dodoma, and Southern Highlands Airports (Songwe and Njombe). The Ministry of Works & Transport has started the process of obtaining contractors for Engineering, Procurement, Construction and Financing (EPC + F) for construction of approximately 2,035 kilometers of roads.

COST ESTIMATION

Plant Capacity            53 Nos/Day

Land & Building (10,000 sq.mt.)    TSH 2.00 Cr

Plant & Machinery                    TSH 2.50 Cr

Working Capital for 2 Months    TSH 7554.68 Cr

Total Capital Investment          TSH 7563.69 Cr

Rate of Return                          12%

Break Even Point                      52%

CONTENTS

INTRODUCTION

TANZANIA OVERVIEW

OPPORTUNITIES

BUDGET OVERVIEW

KEY SECTOR HIGHLIGHTS

MARKET OVERVIEW

TANZANIA ECONOMY

INTRODUCTION TO THE ECONOMY OF TANZANIA

THE TANZANIAN ECONOMY IN 2022, 2023, AND BEYOND

TANZANIA KEY ECONOMIC SECTORS

TANZANIA INFLATION

TANZANIA EXCHANGE RATES

TANZANIA BALANCE OF TRADE

TANZANIA NATIONAL DEBT

TANZANIA FOREIGN DIRECT INVESTMENT (FDI)

INDUSTRIALIZATION

TANZANIA 2025 VISION:

TANZANIA GOVERNMENT’S PRIORITY:

RULES &REGULATIONS IN TANZANIA

TANZANIAN FINANCE ACT, 2023 ANALYSIS

DIGITAL SERVICE TAX (DST)

INCOME TAX ON REALIZATION OF INTEREST IN LAND OR BUILDING

INCOME TAX EXEMPTION

PRESUMPTIVE TAX REGIME

VALUE-ADDED TAX (VAT)

VAT DEFERMENT ON CAPITAL GOODS

ELECTRONIC SERVICES

ZERO-RATED SUPPLIES

INPUT TAX CREDIT

VAT EXEMPTIONS

IMPORTS AND SUPPLIES OF THE FOLLOWING ITEMS ARE EXEMPTED FROM VAT:

TAX ADMINISTRATION ACT

PRIMARY DATA SERVER

APPLICATION FOR REFUND

STORAGE FACILITY

THE FOLLOWING DEFINITIONS ARE PROVIDED WITH RESPECT TO A STORAGE FACILITY

FINE FOR FAILURE TO USE FISCAL DEVICE

DISCLOSURE OF INFORMATION ON CONTRACTED SERVICES

EXCISE (MANAGEMENT AND TARIFF) ACT

PERIODIC ADJUSTMENTS

ADJUSTMENT OF EXCISE DUTY RATE

VOCATIONAL EDUCATION AND TRAINING ACT

THE FOLLOWING CHANGES HAVE BEEN MADE WITH RESPECT TO SKILLS DEVELOPMENT LEVY (SDL).

CHANGES IN OTHER LAWS

THE ACT HAS ALSO AMENDED THE FOLLOWING LAWS:

MINING ACT

GAMING ACT

EXPORT TAX ACT

ELECTRONIC AND POSTAL COMMUNICATIONS ACT

NATIONAL PAYMENT SYSTEMS ACT

LOCAL GOVERNMENT FINANCE ACT

LOCAL GOVERNMENT AUTHORITIES (RATING) ACT

APPLICABLE RATES FOR PROPERTY TAX ARE INCREASED AS FOLLOWS:

ROAD AND FUEL TOLLS ACT

FOREIGN VEHICLES TRANSIT CHARGES ACT

IMPORTANT REGULARITIESORGANIZATION/BODIES IN TANZANIA

AGRICULTURAL MACHINERY AND TECHNOLOGY & THEIR USAGE

PLOUGH

COMBINE HARVESTER

ROTAVATOR OR ROTARY TILLER

DISC HARROW

LEVELER

FINAL PRODUCT

PLOUGH

SEEDER

PLANTER

HARVESTER

CROP DUSTER

SPRAYER

LIST OF 10 LAND PREPARATION MACHINERY

1. LEMKEN MELIOR

2. JOHN DEERE POST HOLE DIGGER

3. MAHINDRA GYROVATOR ZLX

4. JOHN DEERE GREENSYSTEM SUBSOILER TS3001

5. MAHINDRA POST HOLE DIGGER

6. MAHINDRA MOULDBOARD

7. MAHINDRA DISC HARROW

8. MAHINDRA GYROVATOR ZLX 125

9. MAHINDRA DISC PLOUGH

10. JOHN DEERE DUCKFOOT CULTIVATOR

LEADING AGRICULTURE EQUIPMENT INDUSTRY PLAYERS

1. JOHN DEERE

2. CNH INDUSTRIAL N.V.

3. AGCO CORPORATION

4. CLAAS KGAA MBH

5. CHANGZHOU DONGFENG AGRICULTURAL MACHINERY GROUP CO., LTD.

6. LOVOL HEAVY INDUSTRY CO., LTD.

7. CHANGFA AGRICULTURAL EQUIPMENT CO., LTD

8. YTO GROUP CORPORATION

9. SDF GROUP

10. SHANDONG CHANGLIN GROUP

MANUFACTURING PROCESS

LIST OF MACHINERY & EQUIPMENTS AVAILABLE IN EXISTING INFRASTRACTURE

PLANT & MACHINERY MANUFACTURER

VESSEL SUPPLIERS

MIXER

COLOURS OR MOULDING COMPOUND

SUPPLERS OF OTHER RELATED PLANT & MACHINERY

BOBBIN WINDER

HOT WATER BATH

VESSEL

SUPPLIERS OF RAW MATERIALS

PROJECT LOCATION: COUNTRY

GEOGRAPHY

AREA AND POPULATION

CLIMATE

THE CAPITAL CITY

ADMINISTRATIVE REGIONS AND DISTRICTS

CULTURE

POLITICS

CLIMATE

THE CAPITAL CITY

ADMINISTRATIVE REGIONS AND DISTRICTS

CULTURE

POLITICS

DOCUMENTS REQUIRED FOR LICENSES

LIST OF DOCUMENTS:

PRINCIPLES OF PLANT LAYOUT

STORAGE LAYOUT:

EQUIPMENT LAYOUT:

SAFETY:

PLANT EXPANSION:

FLOOR SPACE:

UTILITIES SERVICING:

BUILDING:

MATERIAL-HANDLING EQUIPMENT:

RAILCOADS AND ROADS:

MAJOR PROVISIONS IN ROAD PLANNING FOR MULTIPURPOSE SERVICE ARE:

PLANT LOCATION FACTORS

PRIMARY FACTORS

1.   RAW-MATERIAL SUPPLY:

2.   MARKETS:

3.   POWER AND FUEL SUPPLY:

4.   WATER SUPPLY:

5.   CLIMATE:

SPECIFIC FACTORS

6.   TRANSPORTATION:

7.   WASTE DISPOSAL:

8.   LABOR:

9.   REGULATORY LAWS:

10.  TAXES:

11.  SITE CHARACTERISTICS:

12.  COMMUNITY FACTORS:

13.  VULNERABILITY TO WARTIME ATTACK:

14.  FLOOD AND FIRE CONTROL:

EXPLANATION OF TERMS USED IN THE PROJECT REPORT

DEPRECIATION:

FIXED ASSETS:

WORKING CAPITAL:

BREAK-EVEN POINT:

OTHER FIXED EXPENSES:

MARGIN MONEY:

TERM LOANS:

TOTAL LOAD:

LAND AREA/MAN POWER RATIO:

UTILITIES

POWER

WORKING

TOTAL MANPOWER AND PAYROLL

UTILITIES

LABORATORY TESTING EQUIPMENTS

SWOT ANALYSIS

STRENGTHS

WEAKNESSES

OPPORTUNITIES

THREATS

ORGANIZATION CHART

PLANT LATOUT

IMPLEMENTATION SCHEDULE

APPENDIX – A:

01. PLANT ECONOMICS

02. LAND & BUILDING

03. PLANT AND MACHINERY

04. OTHER FIXED ASSESTS

05. FIXED CAPITAL

06. RAW MATERIAL

07. SALARY AND WAGES

08. UTILITIES AND OVERHEADS

09. TOTAL WORKING CAPITAL

10. TOTAL CAPITAL INVESTMENT

11. COST OF PRODUCTION

12. TURN OVER/ANNUM

13. BREAK EVEN POINT

14. RESOURCES FOR FINANCE

15. INSTALMENT PAYABLE IN 5 YEARS

16. DEPRECIATION CHART FOR 5 YEARS

17. PROFIT ANALYSIS FOR 5 YEARS

18. PROJECTED BALANCE SHEET FOR (5 YEARS)