THE UNITED REPUBLIC OF TANZANIA
PRESIDENT’S OFFICE
REGIONAL ADMINISTRATION AND LOCAL GOVERNMENT
ASSESSMENT OF INVESTMENT OPPORTUNITIES AND CHALLENGES AT KAKONKO DISTRICT
FINAL REPORT
EXECUTIVE SUMMARY The study on assessment investment opportunities and challenges was conducted by Kakonko District Council Director in collaboration with the private sector under the sponsorship of Local Investment Climate Project (LIC). The objective of this study was to assess the investment opportunities and obstacles to investments in Kakonko so that the District could have readymade document showing various investment opportunities available in the District and use it to inform prospective internal and external investors wishing to invest in the District. The study covered all 13 wards in Kakonko district. The methodology of data collection involved collection of both qualitative and quantitative information. Results of the study indicated high level of investment opportunities hinged in Agricultural and natural resource sectors. The potential investment was on increasing agricultural production, Agro- processing together with livestock sector. Good investment opportunities are also existing on exploitation of natural resources in terms of mining, beekeeping and establishment of Community Based Hunting Blocks in Moyowosi Game/Kigosi Reserve.
However, in order to have good environment for investment, participants of the study suggested the government and other development stakes to improved local investment capital and improve access to credit. They also commented on the need to conduct community empowerment on entrepreneurship skills and improve market access especially for agricultural products. People also suggested the government review on tax and investment policies. Such motivating environment will improve the commitment of local community to investment into various existing investment opportunities. While most of agricultural investment opportunities were suggested to be invested by the local people, respondents on the interview suggested mining industry to be promoted to the external investors.
TABLE OF CONTENT
EXECUTIVE SUMMARY ...... 2 LIST OF TABLES ...... 5 1. INTRODUCTION ...... 7 1.1 Background and Justification of the Study ...... 8 1.2 Overall Purpose of the Study ...... 9 1.2.1 Specific objectives:- ...... 9 2. METHODOLOGY ...... 10 3. RESULTS OF THE STUDY ...... 11 3.1 Profile of the Study Population ...... 11 3.2 Economic Activities Undertaken by People in Kakonko District ...... 11 3.3 Sector of Urgent Investment ...... 12 3.4 Investment Opportunities Existing in Kakonko District ...... 14 3.4.1 Agriculture as Investment Opportunity ...... 14 4.4.1.1 Investment Opportunity in Rice Production ...... 17 3.4.1.2 Gross Margin Analysis in Rice Value Chain ...... 20 3.4.1.3 Distribution Cost and Income Between Chain Actors ...... 23 3.4.2Investment in Agro-Processing ...... 23 3.4.3 Investment in Post-Harvest Management ...... 24 3.4.5 Investment in Agricultural Value Addition ...... 26 3.4.6 Investment Opportunities in Horticultural Production ...... 27 3.4.7 Livestock Sector as Investment Opportunity ...... 28 3.4.8 Investment in Agricultural Marketing and Transporting ...... 29 3.5 Investment Opportunity in Natural Resources ...... 29 3.5.1 Investment in Aquaculture ...... 30 3.5.2 Natural Tourists Attraction as Investment Opportunities ...... 30 3.5.3 Cultural Tourism as Investment Opportunities ...... 32 3.5.4 Mining as Investment Opportunity ...... 33 3.5.5 Beekeeping as investment opportunities ...... 34 3.5.6 Investment in Rural Energy Supply ...... 34 3.6 Investment in Commercial Infrastructure and Large Enterprises ...... 35 3.6.1 Investment into Bus Stand...... 36 3.6.2 Investment into Market Infrastructures ...... 36 3.6.3 Investment for SMEs and Large Enterprises in Kakonko District ...... 37 3.7 Investment in Social and Health Services ...... 38 3.7.1 Investment in Health Services ...... 38 3.7.2 Investment Opportunities in Education ...... 39 3.8 Revenue Collection from Investment ...... 41 4. CHALLENGES FACING INVESTMENT IN KAKONKO DISTRICT ...... 41 5. CONCLUSION ...... 43
LIST OF TABLES
Table 1: Investment Opportunities in Agricultural Sector ...... 15 Table 2: Agricultural Investment Opportunities by Wards...... 16 Table 3: Irrigation Areas in Kakonko District ...... 18 Table 4: Marketing of Milled Rice ...... 19 Table 5: Investment Requirements for Rice in the Study Areas ...... 20 Table 6: Rice Producers Cost and Margin Selling at Farm Gate ...... 21 Table 7: Rice Processors Cost Margin - Processing and Trading (Per Bag of 72kg) ...... 21 Table 8: Rice Traders Costs Margins (per 100 Kg) ...... 22 Table 9: Transporters Cost and Margin (Per bag of 100) ...... 22 Table 10: Investment in Value addition ...... 27 Table 11: Investment Opportunities in Livestock Sector ...... 28 Table 12: Investment Opportunity in Natural Resources ...... 29 Table 13: Investment for SMEs and Large Enterprises in Kakonko District ...... 37 Table 14: Investment Opportunities Health Sector ...... 39 Table 15: Investment Opportunity in Education Services ...... 40
LIST OF FIGURES
Fig 1: Main Occupation of People in Kakonko District ...... 11 Fig 2: Main Business Activities Undertaken in Kakonko District ...... 12 Fig 3: Sector of Urgent Investment ...... 12 Fig 4: Sectors that need external investors ...... 13 Fig 5: Proposed Ways to Exploit Investment Opportunities in Kakonko ...... 13 Fig 6: Investment Opportunities in Kakonko District by Priority...... 14 Fig 7: Agricultural Value Chain Operating Framework in Kakonko District ...... 17 Fig 8: Distribution of Share Profit along the Value Chain...... 23 Fig 9: Major Source of Power ...... 35 Fig 10: Education Level in Kakonko District ...... 39 Fig 11: Improving Revenue Collection...... 41 Fig 12: Investment Challenges in Kakonko District ...... 42
1. INTRODUCTION Kakonko District is a newly established district in Kigoma region, North-Western Tanzania. The district was established 2011 under the Local Government Act no 7 of 1982. Officially Kakonko District Council initiated on 08 March, 2013 and published in government gazette of 08/03/2013 with GN.42. The District Council was initiated as a result of division of Kibondo District into two Districts of Kibondo and Kakonko. Administratively it is divided into three divisions namely Kakonko, Kasanda and Nyaronga. Moreover, there are 13 Wards, namely; Kasanda, Mugunzu, Gwanumpu, Katanga, Kakonko, Kasuga, Rugenge, Kiziguzigu, Muhange, Nyabibuye, Nyamtukuza, Gwarama and Kanyonza. The district divided into 3 divisions, 44 villages and 358 hamlets. According to 2012 national population Census, the total population of the district was 167,555 with average annual population growth rate of 2.4%.
Geographically, Kakonko District is located at the Northern part of Kigoma Region between latitude 3.90 –5.00 S, and longitude 30.20 –31.500 E. It is at the average altitude between 1,000m and 1,700m above the sea level. The district covers 7,715.05 square Kilometres and great part of the area is covered by forest and Game Reserve of Moyowosi/Kigosi. The two third of the district is covered by forest and Miombo woodlands. The rest of the District is made up of flood plain, which is suitable for paddy production. It borders Ngara and Biharamulo Districts (Kagera Region) on the north, Bukombe District (Shinyanga) on the East, Urambo District (Tabora) on the South East, Kibondo Districts on the South and Republic of Burundi on the West.
The District has temperature range from 15˚C to 22˚C throughout the year. The rainfall pattern is characterized by bi-modal rainfall system occurring from October to December and March to May. The annual rainfall intensity ranges between 800mm to 1600mm peaking in April and the humidity is around 10%. Kakonko has larger Land Bank of about 2,600ha suitable for agricultural investment. It is well supplied with river streams almost all around the district most of them discharging water in Moyowosi River. The availability of these rivers gives an opportunity for implementing irrigation schemes in the district. However, most of the agricultural activities still depend on rain fed agriculture. The crops cultivated include; maize, paddy, cassava, tobacco, cotton, sugar cane, beans, bananas coffee and diverse fruits.
1.1 Background and Justification of the Study Kakonko District is ranked as the least developed districts in Tanzania based on recent information on poverty analysis. However, the District remains the best endowed in natural resources and in opportunities suitable for investment in Tanzania. But the challenge remains on transforming these resources for the district’s economic development based on available resources. However, the district has little information on the existing opportunities in terms of their spatial distribution and available quantities. It is therefore critical that these opportunities need to be identified and documented as reference data for decision making and on investment promotion.
The idea to conduct study on assessment of the investment opportunities in Kakonko district originated from the discussion held during the District Business Council (DBC) that conducted in 14th July, 2015. Participants of the council explained the need to have thorough information on investment opportunities existing in Kakonko district that will be used as reference data for promoting the district investments. The same issue raised in various private sector district meetings that involved both private and public sectors. The issue was also raised and discussed during the district council meeting held in 11th August, 2016 where members of council enquired the need to quantify and document mining resources in the district. Emphasis was put to generate an information on the potentialities of natural resources like gold and lime reserve so that negotiation can proceed to the interested investors. Based on this need, the district council in collaboration with Local Investment Climate (LIC) conducted this study. The information gathered from this study will enable the district to take informed decision on which resource that need urgent investment in order of priorities and work on the sighted obstacles to investment.
1.2Overall Purpose of the Study The main purpose of the study is to assess investment opportunities and obstacles to investments in Kakonko District.
1.2.1 Specific objectives:- 1. To investigate, map and analyse investment areas and opportunities available for investment within the District. 2. To document investment opportunities existing in Kakonko district council for local and regional investors.
3. To rank the investment opportunities by showing where investments would yield the highest returns per TZS invested. 4. To rank identified investment opportunities by sector, by ward and by ease of access as well as by time frame of implementation. 5. To analyse competitive advantage of doing business in Kakonko District
2. METHODOLOGY This study employed descriptive research design where both primary and secondary data were collected. The information collected were both qualitative and quantitative using semi-structured questionnaire and tool for collecting secondary information. Primary data were collected through in- depth interviews to the head of household. Primary at village level in each ward. Qualitative information was gathered through group discussion with members of village councils using check list. Site observation of investment opportunities mentioned by responded conducted by the field data collectors. The sample size for interview was 250 individuals selected randomly villages within from all 13.
The description of the site mentioned as area that need investment was conducted and documented. For the purpose of in-depth description of gross margin analysis, this study focused on the district business crop which is known as paddy. Based on this criteria gross margin analysis was conducted to reveal area within the value chain that bear maximum profit per unit cost of investment. Village meeting were conducted involving meetings with village government members and focus group discussions with private sector operators in the formal and informal sector.
Day one and day two, spent for interviewing and giving questionnaires to the key informants. Day three was dedicated in conducting meeting at ward level which involved ward development committee, the private sector, religion leaders and famous elders. Information related to investment opportunities were also gathered from members of the district business council through meetings. This study ensured the participation of private sector in all steps in undertaking this study. People were involved in data collection, analysis and compilation to avoid biasness of the information.
3. RESULTS OF THE STUDY 3.1 Profile of the Study Population
Information from this study indicated that majority of rural people (83.5%) in Kakonko District are involved in agricultural activities and livestock keeping (Fig.1). Investment that targets these sectors can also generates employment opportunities to the majority of rural people in the district. When asked their major sources of income, 83.5% of the respondents of interview mentioned agriculture and livestock to be their main occupation. Small number of people in the rural areas were reported to be engaged in small business operation and employed in both informal and formal sectors
Fig 1: Main Occupation of People in Kakonko District
3.2 Economic Activities Undertaken by People in Kakonko District People in Kakonko district are involved in various economic activities. In ranking to the priorities, many people in the rural community considered earning their income through agriculture (43.6%), Livestock (22.5%), from involvement into SMEs (25.6%) while other were selling forestry products such as timbers and charcoal and in small mining. Beekeeping was also mentioned to be the source of income to the number of people. However, based to the number Community Based Forestry Reserves (CBFR) almost available at each village investment on beekeeping has not yet exploited to significant level.
Fig2: Main Business Activities Undertaken in Kakonko District
3.3 Sector of Urgent Investment In ranking investment opportunities in term of people preference, agriculture seemed to lead on all sectors that need investment. This followed by areas of natural resources specifically on mining and beekeeping. Tourism though not yet established in Kakonko district was given priority for investment. The district has both natural and cultural attraction of which the district can utilize these opportunities to improve its domestic revenue. The highlights of the priorities are demonstrated in the figure below.
Fig 3: Sector of Urgent Investment
But when asked whether external investment required to exploited these resources people had different view. However, 69% of all interviewed indicated their agreement on the need for external investors while 31% percent recommended these opportunities to be exploited by the local people.
Fig 4: Sectors that need external investors
During the interview when people asked to rank resources that a least developed in the district, lager number mentioned natural resources in term of mining and beekeeping and better use of Moyowosi game reserve.
Fig 5: Proposed Ways to Exploit Investment Opportunities in Kakonko
3.4Investment Opportunities Existing in Kakonko District During the interview, people were asked to propose some areas that need investment. Again, 51.5% of the responses from the interview indicated agriculture to be the lead sector that need investment (Fig 6). Other important areas for investment include animal husbandry (20.5%), beekeeping (13%) and (mining 7.2%). Few individuals mentioned the need for investment on irrigation and cassava processing and in aquaculture. Response of this nature was expected since majority of the respondents were farmers and livestock keepers.
Fig 6: Investment Opportunities in Kakonko District by Priority.
3.4.1 Agriculture as Investment Opportunity The district’s economy highly depends on agricultural sector. The sector employs about 90% of all labour force in the district and largely contribute to the district revenue. The District has a total of 108,420 ha of arable land and 2214 ha suitable for irrigation scheme. But the District reports indicate that, 43% of the arable land remains completely unexploited and requires some investment. The sector also has some high contribution to the district revenues.
Good climate condition in Kakonko district favours production of various types of both food and cash crops. Rainfall is bi- modal well spread throughout the year, peaking between March and May, with another, shorter rainy season between October and early January. The major food crops grown in the district include maize, sorghum, millet, rice, beans, cassava, potatoes and bananas. Maize and beans production dominate much of the food crops grown in the district. Additionally, Tanzania's farmers grow a huge variety of fruit, vegetable and spice crops. Cash crops grown in the district include coffee mainly grown in the highland agro-region, tobacco and cotton. Based on the information collected in the field, majority of respondents commented that agriculture sector has great potential in improving the district revenue and in contributing to household economic development.
Table1: Investment Opportunities in Agricultural Sector Investment Opportunity in Agricultural Production Obstacles for Description Available (ha) Exploited (ha) Need investment Investment (ha) Total Arable land (ha) 108,420.14 61,424.23 46,995.9 Poor ago- investment Cultivated (ha) under 1756.5 1194 562.5 Irrigation schemes Area suitable for irrigation 2214.5 1262.75 1451.75 systems (ha) No. of tractors 7 7
Kakonko district is divided into three agro-zones namely highland zone, low land zone and medium zone. The high land ranges to the attitude of 1500-1700 above sea level and receives average rainfall of 1000mm-1600mm. this zone include 4 wards; Nyabibuye, Nyamtukuza, Muhange and part of Kasuga ward. Main crops grown in this zone include maize, rice, coffee, banana and beans. This zone is characterized by low tsetse intensity thus known to be a zone of high livestock keeping where cattle, goats, sheep and pigs are kept. Investment in livestock production is highly welcomed in this zone.
The mid-land zone occupies mostly the southern part of the district stretching to the border of Burundi. The area is elevated to 1200-1500 above sea level and receives average rainfall 850mm- 1500mm. the wards within this zone are Kasanda, Rugenge, Gwanumpu, Kakonko and Mugunzu. Soils in this zone is clay to loam soil. Both crops grown in the highland and low land are also grown in this zone. This zone is known to be a zone of beekeeping and cash crops like cotton, and tobacco. Food crops mainly produced include maize, millet, beans and banana. Investment in tobacco and cotton cultivation can generate a positive performance in this zone. Investment in maize and beans production can also be promising. But due to having high tsetse intensity and large area being occupied for crop production, animal production is at minimal scale. Therefore, livestock investment in this zone is not so much encouraged.
The low land zone is characterized by Miombo woodland and mostly occupied by Moyowosi/Kigosi game reserve. The landscape ranges from 1000-1200 above sea level and receives 600mm-1000mm rainfall. The area includes; Kiziguzigu, Kasanda and Kakonko wards. The crops that are cultivated in this zone are cotton, maize, millet, groundnuts, cassava, rice and sweet potatoes. Due to high tsetse intensity, livestock keeping is kept at minimum. Due to the relatively low average rainfall received per year, investment in drought torrent crops such as cassava and millet and irrigated crops like rice can have good performance in this site. However, the site is good for investment in hunting tourism due to high number of wildlife available in the game receive.
Table 2: Agricultural Investment Opportunities by Wards Investment Opportunity in Agricultural Production S/N Ward Arable land (ha) Cultivated (ha) Need investment (ha)
1 Kasanda 9,527 4,112 5,415 2 Kasuga - - - 3 Kanyonza 7,963 4,616 3,347 4 Kakonko 4,614 3,753 861 5 Gwanumpu 12,154 4,340 7,814 6 Katanga 8,454 223 8,231 7 Nyamtukuza 7,781 251 7,530 8 Kiziguzigu 3,270 - - 9 Gwarama 2,758 1,886 872 10 Muhange 1,621 809 812 11 Rugenge 4,138 4108 30 12 Nyabibuye - - - 13 Mugunzu 3564 1560 2004
Fig 7: Agricultural Value Chain Operating Framework in Kakonko District
+ Not well established in + Poor Processing + Price is determined by rural areas technology consumer interest + Improved seeds supplied + Individual owned + Not aware of the by agricultural institutes + Quality is uncompetitive quality certification + Improved Seed not + No product quality + Lack product traded by local agro- certification traceability dealers + Processors are also Traders control prices:
+ Use of recycled seeds. + Poor agronomy practices +Prices vary with brand +Limited quality seeds. + Low inputs/use of poor + Crops traded on local + Improved variety still at seeds seeds market multiplication units + Small scale farming 1- + Traditional Poor packaging 2acres/individual + Limited agro-inputs dealers in + No whole sale + Few use of mechanization. rural areas + Not linked to financial services + Not linked to the market
4.4.1.1 Investment Opportunity in Rice Production Water resource is available for carrying irrigation scheme year around given significant area available for irrigation. However, the district reports indicate that 66% of the areas suitable for irrigation remains un exploited. Paddy is known to be the major commercial crop in Kakonko District. This study therefore despite of other crops grown in the district took paddy in analysis of gross margin and in study where a unit of cash can generate maximum profit. Paddy production in Kakonko district dates back in 2002. The first irrigation scheme was known as Bugunga A / Muhwazi irrigation scheme located at Itumbiko village covering 202ha. To date the irrigation schemes have been expanded in the district with 956ha direct under cultivation. There are more than 2,722 households currently directly benefiting from these schemes with large multiplier effects. Rice is becoming both business and staple crop of high prospect of market potential in this district. Rice cultivation is conducted in the surveyed irrigation schemes and not surveyed areas. The District has about 956ha surveyed area for irrigation but the currently the area under irrigation is only 884ha. There are 6 irrigation schemes located in 2 divisions of Kakonko and Nyaronga.
These schemes include; Mwiruzi, Ruhwiti, Nyaronga, Bugunga A&B, and Katengera. However, the district has still large potential area for rice cultivation under irrigation systems. It is estimated that 6,386ha area can further be utilized for irrigation purpose. Nevertheless, due the good pattern of rainfall in the district even farmers who depend on rain fed agriculture still attain reasonable harvest.
Katengera Irrigation scheme at Kinonko Village (Filed Photo, 2016)
Table3: Irrigation Areas in Kakonko District S/n Ward Name of Village [s] Present Number of Surveyed area scheme irrigated Farmers (Ha) area (ha] 1 Kasuga Ruhwiti Nyakayenzi 168 330 140 Katengera Kinonko 196 248 217
2 Nyabibuye Mwiruzi Rumashi 140 180 152 3 Nyamtukuza Nyaronga Nyaronga 50 - 153 4 Kiziguzigu Bugunga B Kiyobera 128 250 138 Nchumito 5 Kakonko Bugunga A Itumbiko 202 278 150 Mhwazi Total 884 956 950 Source: Agriculture and irrigation Department, Kakonko Dc,2016 In all schemes, it is estimated that the Tshs. 1,912,478,000/= was generated during the period of 2015/2016. But this amount took consideration that all farmers sold milled product at the average retail price of 1400/=. However, this price fluctuates with time depending on the season and availability of traders. Therefore, most of farmers opt to sell raw rice at farm gate price which is relatively low.
The local markets available enable most of the farmers to sell raw rice to the middlemen at low farm gate price. The rice processing is done using traditional tools or small milling machines that generate low quality of rice. Rice processing is done by individual entities and the processing cost is determined by owners of the machines. Nyaronga scheme completely lack any rice processing unit. Rice producers have to move more than 10 kms from their village at Munzani area in Kagera region looking for rice milling machines. The constraints related to rice processing include; - Lack of rice milling machines in some schemes like Nyaronga and Mwiruzi - Lack of rice grading technology - Poor knowledge and participation of producers in rice value addition - Lack of appropriate packaging materials - Lack of standards and compliances in rice processing
Table 4: Marketing of Milled Rice Ward Scheme Total Quantity for Amount from Total in TZS (000) production sells 1 (tons) sells-retail price (Tons) 2 (Tshs) Kasuga Ruhwiti 821.7 328.68 295,812,000 Katengera 1,089.00 435.6 392,040,000 Nyabibuye Mwiruzi 373.68 149.472 134,524,800 Nyamtukuza Nyaronga 156.24 62.496 56,246,400 Kiziguzigu Bugunga B
Nchumito 255.96 102.384 92,145,600 Kakonko Bugunga A
Mhwazi 718.56 287.424 258,681,600 1,229,450,400 Total
Source: Filed data, 2016 1Sells accounts to 40% of total rice production. 2 Average retail prices Tshs. 1400/=
Table 5: Investment Requirements for Rice in the Study Areas Value Chain Type of Investment Inputs - Improved Seed multiplication unit and certification - Rural fertilizer supply unit - Mechanization Production - Farmers field schools - Agro-machineries - Water intake improvement - Water canals repair and maintenance - Irrigation dams Trading, transporting and storage - Rural Access Roads upgrading e.g. WRS - Construction of warehouse at Rumashi village and Nyamtukuza and repairs of existing warehouses in other villages - Trucks for product transportation - Management of 6 existing warehouses Processing - Advanced processing machines - Grading systems - Standard and regulation compliances sites - Post-harvest loss management training center Marketing e.g. brand and - Formal market linkages distribution system - Market facilities especially border markets e.g. Muhange border market. - Product certification Value addition - Production of packaging materials - Grading and Product branding Policy e.g. advocacy - Advocacy services on price control - Enabling environment for export such as one stop business center. Source: Field data, 2016
3.4.1.2 Gross Margin Analysis in Rice Value Chain For the purposes of this study calculations of the gross margins refer to revenue minus direct or variable costs. It must be understood that the calculations are to a large extent based on the costs and prices that prevailed during the study visits and in the markets visited. The prices are subject to change based on operating environment. However, we have made effort to ensure that the calculations would reflect future basis for such calculations. In additions, the production averages take into account the best and poor yielding farms-some farmers did get up to 8 bags per acre while others got 17 bags per acre.
According to the study results, rice has very low gross margin once sold in raw form. Low gross margin was mainly due to low productivity coupled with low farm gate price offered. Information on the revenue gained by the producers involved in processing was not available as many of the producers are not involved in processing. This is because they sell their produce to the traders or processors in raw form. The data summarized in the tables below shows that 100kgs of raw rice is sold at a cost of Tsh. 72,000/=. With this calculation, producer can accrue the profit margin up to 21% followed by processors 19%. However due to the fact that producers do not consider their labour as a cost, the profit may be higher than that one calculated.
Table 6: Rice Producers Cost and Margin Selling at Farm Gate Item Cost/acre (Tshs.) Inputs 130,000 Land Preparation 110,000 Labour 310,000 Packaging 16,000 Total Costs 566,000 Revenue 720,000 Margin 154,000 % Margin 21.4.7% Source: Field data, 2016
Table 7: Rice Processors Cost Margin - Processing and Trading (Per Bag of 72kg)
Cost Item/Activity Units Quantity Amount
Processing Cost Raw materials Kgs 1bag 90 Transport trip 1 1000/= Levy bag 1 - Labour bag 1 2000/= Packaging 100kg 1 1000/= Periodic maintenance/servicing bag 1 1000/= Total Costs 5000/=
Revenue from processing one bag of Bag 1 4200/= rice Gross margins 800/=
Gross margin % 19%
Source: Filed data, 2016
Table 8: Rice Traders Costs Margins (per 100 Kg) Item Amount in Tshs Raw materials (per 100 kg) 72,000 Transport 4,000 Levy - Labour - Packaging - Communication 5,000 Storage 5,000 Tax 500 Rent - License - Salary - Total Costs 77,500 Revenue 90,000 Gross margins 12,500 Gross margin % 13.8% Source: Filed data, 2016
Table 9: Transporters Cost and Margin (Per bag of 100) Item Amount Tshs Fuel 2000 Periodic maintenance/servicing 500 Labour 500 Insurance - Communication 500 Tax - License - Salary - Fine - Total Costs 3,700 Revenue 4000 Gross margins 500 Gross margin% 12.5% Source: Field data, 2016
3.4.1.3 Distribution Cost and Income Between Chain Actors The distribution of cost and income along the chain actors in rice involve share of profit generated along the rice value chain. The percentage share of profit each actor gets along the value chain is indicated in figure8. The analysis shows that higher percentage profit margin (32%) is generated when a unit dollar in invested in rice production than any other part in the value chain. Investment also in rice processing relatively generate high profit when compared with actors like traders and transporters. Investment in rice processing will similarly generate a high profit per unit cost of investment. From this data it can be realized that producers and processors have better share of gross margin than any other value chain actor. Therefore, investment in rice production and processing are highly encouraged as subsequently generate high profits margin.
Fig 8: Distribution of Share Profit along the Value Chain.
3.4.2Investment in Agro-Processing Agro- processing is critical area that need investment from both local and external investors. Generally, large part of all the agricultural produce is sold in raw form. This study revealed that 90% of both food and cash crops are sold in raw form. Some improvement has been noted in paddy subsector where farmers use available small rice milling machine to mill their rice before selling. However, the quality of the milled rice is poor due to high level of broken grain. Therefore, Investment on rice milling and grading is highly needed. The gross analysis conducted on rice subsector indicated that rice processing generates a higher gross margin and ranked the second to production in the overall margin percentage share of 29% in the value chain. Small scale milling machine at Kakonko (source Field photo)
Therefore, investment in rice processing and grading machine in Kakonko district is of critical need in order to meet domestic and cross border business standards. Based This is because this part generates higher profit margin when compared with other actors like traders and transporters. The large scale processing machines, ASB 50-SATAKI with 40 HP mainly used by Kahama processors is useful model for rice processing in Kakonko district. The model is cheaper (25,000,000), easy to operate and locally available. Large scale milling and grading machine in Kahama (Source: Field photo, 2016)
3.4.3 Investment in Post-Harvest Management Post-harvest loss is critical and almost occurring in any crop within the district. Some are due to human error while other comes external factors such as climate change. It is estimated that losses occurring in crops can range from 30-40%. Despite of high production, efforts to reduce these losses have not given priority. Beans and maize are the major crops at risk of being subjected to post-harvest Loss. Despite of these loss the district still accumulates 10,824 MT of beans and 36,988 MT of maize per year.
Post-harvest loss in bean (Field Photo, 2016) Warehouse at Churazo village (Field photo, 2016)
High losses have been observed in cassava and other perishable products such as fruits and vegetables. Lack of storage facilities, poor market linkage, poor transportation, lack of appropriate packaging materials and climate change have been mentioned by many respondents to be the main causes of the loss. However, improving crop storage facilities in all district wards like the structure found at Churazo village in Nyaronga wards can significantly reduce post-harvest loss. The warehouse has storage capacity of 500MT. Cassava is another crop widely produced but lacks appropriate system of reducing post- harvest loss. Farmers lack access to processing machines, storage facility, value addition initiative and reliable market. Due to its capacity to withstand climate change and good performance even in a poor soil, farmers prefer cultivating of this crop for both commercial and household food securities. Cassava packaging Kabingo village (Field photo, 2016) The major markets of the crop are in Burundi and Rwanda countries. While the crop is sold in raw form but processing of the product in various forms of products is conducted in these countries thus Tanzania is missing revenue and other opportunities that could be accrued if investment in cassava processing could be done in Tanzania before exporting.
Data on the volume produced was difficult to determine as many farmers do not document what they either produce and sell. However, during the study cassava farmers commented on poor storage facilities, poor packaging and unreliable market to be the main challenge of cassava farmers. Therefore, investment on cassava storage processing industry would increase the quality and quantity of the product and moreover the price of the product. Traditional cassava storage at Rugunga village (Source: Field photo, 2015)
3.4.5 Investment in Agricultural Value Addition value addition involves on into all the activities, processes or strategies of operation carried out in the production, processing, packaging and distribution which contribute to the maximization of profit or utility derived from rice. Value addition can be undertaken almost at every crop cultivated in The district to maximize profit. Despite being ratified in the Tanzania parliament; agricultural value addition is still not yet implemented in many districts of Tanzania as in Kakonko. Value addition can be undertaken in food crops, cash crops, horticultural crops.
Rice packaging at Ruhwiti Scheme (Source: RERAI, Table
Table 10: Investment in Value addition S/N Crop Value addition Investment required Location 1 Maize - Drying - Silos All wards - Processing - Milling machines - Packaging - Supply of packaging - Branding materials - Storage facilities 2 Beans - Drying - Silos All wards in high and mid- - Packaging - Supply of packaging land agro-zones - Branding materials 3- Storage facilities 3 Rice - Drying - 4Silos Kasuga, Nyaronga, - Processing - M5illing machines Nyabibuye and Kakonko - Packaging - Su6pply of packaging wards - Branding materials - Storage facilities 4 Sunflower - Drying - Processing machines All wards - Processing - Refinery machines - Packaging - Supply of packaging - Branding materials - Storage facilities 5 Cassava - Drying - Processing machines Mid and low land zone - Processing - Supply of packaging - Packaging materials - Branding - Storage facilities 6 Vegetables and - Processing - Canning industry All Agro-zones in the fruits - Canning - Processing industry districts - Packaging - Cold chambers - Branding
3.4.6 Investment Opportunities in Horticultural Production Horticultural activity is among of the business activities in the district although it significance to the contribution to economic development has not yet realized. The activity is conducted along the five major rivers and other minor rivers in the district. Both high land and midland are the potential areas for horticultural activities but Nyamtukuza and Kasuga wards are the leading ones. Vegetables grown in the district include; tomatoes, onions, eggplant, amaranths, ginger, carrots fruits such as passion fruits, avocadoes, oranges, mangoes, guava, pawpaw etc.To date only two groups are known to be involved in horticultural activities. The Tumaini group at Kasuga and Muungano groups at Nyamutukuza are the main groups involved in horticultural production. These groups are well connected to the external market for their products. Kasuga is well supplied with river stream from Ruhwiti river and Nyamtukuza has reliable water source suitable for irrigation from Mwiruzi river.
Most of the vegetables are consumed locally while the rest sold to the nearby districts such as Kahama, Ushirombo and far cities such as Mwanza, Dodoma and Dar es salaam. Due to the large areas suitable for horticultural activities, investment opportunities in this business is highly welcomed. The river streams that provide suitable areas for horticultural activities include; Mwiruzi, Moyowosi, Kahambwe, Muhwazi, Ruhwiti and Kivuruga. Recently the district has offered horticultural irrigation kit for the group at Gwarama.
3.4.7Livestock Sector as Investment Opportunity Livestock industry is very important for district economic development. Livestock keeping is mainly conducted by Agro- pastoralists at the northern part of the district mainly Nyaronga and Nyabibuye wards. Main animals kept include; cattle, goats, sheep, pigs and chicken. Add Somewhere Kihomoka village in Kanyonza ward
Table 11: Investment Opportunities in Livestock Sector Investment Opportunity in livestock Keeping Obstacles for Description Available Need investment Investment
Indigenous cattle 17,491 Animal ranching - Lack of land use plan for grazing - Lack of investor in animal ranching Improved cattle 53 Investment in artificial - Poor animal insemination improvement Pigs 823 - Poor investment on pig production Goats 19,597 -
Chicken 77,597 Improved chicken - Poor capital keeping investment Milk produced/yr. (lts) 68,445 Cheese industry - Lack of milk processing machines Butcheries 05 Investment Abattoir -
Vet. Pharmacies 04 -
Source: Field Data, 2016
3.4.8 Investment in Agricultural Marketing and Transporting Agricultural marketing is one of the challenge facing farmers in Kakonko District. The district lack essential infrastructure like market infrastructure, access roads and crop collection centers. If there could be good market infrastructure the District could be able to benefit from its geographical location of being easily access to Burundi, Rwanda and DRC markets for the various crop produced. Reaching these market, border market should be well developed. The district is in plan to build border market (Muhange Border mkt at Muhange ward) to enable farmers being linked to East Africa region trade.
3.5Investment Opportunity in Natural Resources Natural resources in Kakonko district are also abundant but not exploited. The District is endowed with a variety of attractive natural resources including gemstones, water, forestry and game resources. However, the contribution of these resources to improve district revenue and economic development remains insignificant.
Table 12: Investment Opportunity in Natural Resources Investment Opportunity in Natural Resources Obstacles for Investment Description Available Need investment
District land size 2,219.65 Km2 Moyowosi/Kigosi game 178.65 Km2 Need CBWMA - Poor policy on local income reserve accrue from the GR Community Based 62.38 Km2 Investment on - Low capital investment Forestry reserve forestry product - Lack of training on value (beekeeping) addition. Beekeeping 23,528.3 ha - Poor beekeeping groups empowerment Beehives 36,185 Improved - Low capital investment beehives Honey collected 97 tons 22,000 tons - Lack investors - Lack of honey processing machines
Mining area (Gold) 240,000 Km2 Mining industry - No survey conducted on mineral reserve Mineral dealers 1 Requires investors - Majority of miners are not registered and work informally. Source: Field Data, 2016
3.5.1 Investment in Aquaculture Kakonko district lacks large water bodies and this affect fish industry in the district. Fishing is done in small scale in the rivers such as Moyowosi, Mwiruzi and Mhwazi. The district is therefore supplies from Lake Victoria. Even though Lake Tanganyika is near to the district, fish that are found in the lake are not supplied in the district due to poor infrastructure and transportation barriers. Therefore, investment is needed in supplying fish from Lake Tanganyika. The Kakonko town with the population exceeding 20,000 can reasonable absorb the supply although cost margin analysis has ever been conduct on such industry. However, based on many river streams available investment in fish culture can be attractive business where number of multipurpose water pond serve for both fish culture and crop irrigation can be constructed. Almost every ward in the district has suitable area for fish farming.
3.5.2 Natural Tourists Attraction as Investment Opportunities The great part of the district is covered by Moyowosi/Kigosi game resources. Nevertheless, the contribution of the reserve to the district revenue remains insignificant. Wildlife available in Moyowosi game reserve include; elephants, giraffe, buffaloes, statuga, antelopes, lions, crocodile etc. But the district council and surrounding local communities don not directly benefit for existence of this game reserve. There is the need for investment on Community Based Wildlife Management Areas (CBWMAs) where local community would manage their own hunting blocks and improve their income. Through these block they can locally collect revenues from the hunting tourists and spend the money for local socio-economic development. Thus, the investment opportunities focused on transforming this resource for economic development of the district is highly needed. The waterfall at Bukiriro and Nyakayenzi can be potential site for tourism attraction. Therefore, investment into tour guide to these potation site can increase revenue as well as employment opportunities to the district.
Water fall a tourists’ attraction Nyakayenzi Village (Source: Field Photo, 2016
Zebra in Moyowosi/Kigosi Game reserve
Source Field Photo
Kumlembera natural tunnel is located at Nyakayenzi village about 20 kms western side of kakonko town. The history of this tannel is not yen known but streched a distance of about 100m undergound just few meters from Kumlembera waterfall. This site has for long time been used by local people as worshiping place but a coward site for many normal people.Based on this nature many people even fear to seek information of its origin. To date there is no clear information of the current use of the site. The location of this mysterious feature at the proximity of waterfall gives natural advantage of the site to be used for tourism. Similar tunnel is also found in Nyabibuye village at Kungwa mountain. But different from Kumlembera tunnel, the Kungwa tunnel is known to be constructed by Germans for the purpose of hiding their treasures like gold and other mineral. Even though it is still known to host these treasurers but nobody has ever dared to get in and look what is inside.
Kumlembera tunnel -Nyakayenzi (Source: Field Photo)
3.5.3Cultural Tourism as Investment Opportunities The colonial primary court is one of remaining historical structure remained in Kakonko district. The site was built in 1920s during German colonial era. In 2020 the structure will have 100 anniversaries and become one of the oldest public structure in the district. The structure is located in Muganza Village just 3km from Kakonko town at the northern part of the district. The structure is still in its intended use. There structure is located along Kigoma- Mwanza the main road. The site has great potential for cultural tourism. Colonial Primary Court at Mganza (source: Field photo, 2016)
Another structure of similar fashion is a tradition palace of Ha chief known as UMWAMI located at Itumbiko village. The site reserves Kiha tribal traditional and values typology. The site is a museum site for tradition tools such as spear, arrow and tradition clothes (Mpuzu). Other cultural items include drums, chairs and historical script that reflect cultural and norms of WAHA. Investment in these sites can revitalized significance of these structure at the same time potential site for cultural tourism. There is an earth road passable throughout the year. This site is just 4kms from the main road. Traditional Palace at Itumbiko Village (Field Photo, 2016)
3.5.4 Mining as Investment Opportunity- To add nyamwironge mine map Kakonko district is endowed with valuable minerals reserve such as gold and lime. Nevertheless, these resources have been exploited by small scale miners. According to the district report, there is no comprehensive survey of the mineral reserve in the areas. Therefore, some investment is very much needed first to mines exploration and later exploitation. Efforts of the district to map the areas drew attention of some investors and hopeful these resources might of high potential district revenue generation. Exploitation of this resource is done informally by people with small capital. Based on the facts that small miners are exploiting gold resources, this activity has little contribution to the district revenue. Nyamilonge local gold mining at Nyamtukuza ward(Field Photo,2016)
Lime is another mineral found in large quantity in the district. Mineral exploration on the mineral reserve has not yet determined and the district is appealing for any investor to invest into exploiting this resource. The main challenge regarding exploitation of this resource in based on the fact that, this resource is located within Moyowosi/Kigosi game reserve where exploitation will be subjected to the regulation guiding protection of natural resource within the game reserve. But in all cases for the district to benefit on these minerals,large scale mining industries are highly desired.
3.5.5 Beekeeping as investment opportunities Kakonko district has 23,528.3 hectares suitable for beekeeping. Availability of Miombo woodland provide nectars of different kinds. This environment generates potentialities producing quite amount of honey of organic in nature. Availability of Moyowosi game reserve and Buyungu forestry reserve with significant bee colonies also provide potential opportunities of establish vast range of beekeeping project.
Beehives for Buyungu group-Kakonko (source: BTC, 2013)
Honey production in Kakonko district is known to comply to the international standard because is produced in organic environment. The report by Belgium – Tanzania Cooperation indicated that the level of honey production in Kakonko district kept increasing over the times. Currently 97tons of honey are collected each year from 23,528.3 beehives. But the district study indicated that the district still has some potential of generating 22,000tons of honey per year based on the availability of woodland for the project. Based on availability for large area for beekeeping then investment in honey production is highly
Buyungu Honey products at Kakonko (Source: BTC, 2014)
3.5.6 Investment in Rural Energy Supply Rural energy supply in Kakonko district is still a problem. At the moment the district town is supplied with power system from Kibondo district diesel powered generators. But the generators have the capacity of producing 2.5 MW and is operated by TANESCO. When in fully supply these generators are considered to be enough to power even large scale industries in the district. Therefore, this is a good investment opportunity in agro-processing industries. But some challenges still exist. Only, 3 wards that are located within the electric grid (Kibondo-Kakonko) have access to TANESCO power while the rest 9 not. This study revealed that 91% of all crop produced in the district are sold in raw form. The main obstacles mentioned include lack of rural energy supply, poor infrastructure and lack of agro-processing investors. The information gathered from this study indicated that majority of rural people in Kakonko district use firewood as the major source of energy while 4.2 % agreed to have been connected to TANESCO power source. Investment on the alternative energy supply like solar power, wind electrification and hydro-electric to the two water fall found at Bukiriro, Nyakayenzi and Rumashi can minimized problem of rural energy supply. Fig 9: Major Source of Power
3.6Investment in Commercial Infrastructure and Large Enterprises Entrepreneurship continues to gain importance to economic development in Kakonko District. The role of SMEs in economic development is based on its capacity to influence opportunities for employment, reducing poverty, additional wealth creation by attracting money from other places, introducing and dissemination of new methods and technology and thus overall economic growth. This studies revealed that 26.9% of all people who interviewed were engaged in one way or another in entrepreneurship. Secondary data indicates large number of SMEs centred in Kakonko town rather than in the villages. Due to being newly established district commercial infrastructure are not well developed and need some investment. 3.6.1 Investment into Bus Stand. Currently, Kakonko district has no bus stand and the district is losing revenue from the buses that are passing through district. Being realized by the district council, the district has allocated 6 acres specifically for construction of the bus stand. The site is located at the Southern-East of the district town and upon its completion more than 20 buses, 11 min-buses, 30 haice crossing and small vans will utilize the facility every day. This will enable the district to generate parking revenue. Fund for construction of this structure has already approved by the government. In full operation number of businesses will take place that will ultimately increase the district revenue.
3.6.2 Investment into Market Infrastructures Since upgrade of Kakonko division to district level, increase in population overwhelmed the existed infrastructure. The market structure that existed was formerly planned to accommodate the population of people at division level. The increase in population called the need to expand market place within the district. The district therefore is looking an investor to invest in construction of market structure that will work in line with rapid increasing population. The market was designed to accommodate 400 small business rooms i.e. 200 inside and 200 outside of the market. The market is expected to occupies an area of 1.26ha. Establishment of this market will enable the district council to improve the district revenue through collection of rental fees from these rooms.
The district also is in plan of construction of border market. Three border markets that are expected to be constructed at different border posts with Burundian Country. It is expected that the completion of these infrastructure will improve the district revenue collection as well as market access to the farmers. The 4 border markets that were planned to be constructed at the border posts are; Muhange, Gwanumpu, Kasongati and Kiga. Among these, Muhange border market will have great potential for improving Agricultural marketing due to being located within the high agricultural production zone i.e. the high land zone.
Agricultural transporting is also a challenge for this district. There are few trucks specialized for crop transportation. Due to poor packaging and unreliable transportation, post-harvest loss is high Therefore, there is a great need for investment in this structure and in agricultural transportation. 3.6.3 Investment for SMEs and Large Enterprises in Kakonko District Kakonko district lacks large entrepreneurs that are able to invest into large business and creating number of jobs. This was reflected in this study where only 4 shops were involved into whole sale and absence of supermarkets. Many of retails shops are of small scale. The district also lacks large investors in in many economic sector such as agriculture and natural resources despite of existing such opportunities for investment. Poor investment promotion, bureaucratic nature of investment process and lack of awareness to the local community on investment opportunities remains to be an obstacle. Existence of few financial institutions with high interest rate also limit many groups of SMEs in the district to access financial services. Financial limitation to the SMEs also is influenced by lack of collaterals as condition for loan acquisition.
Table 13: Investment for SMEs and Large Enterprises in Kakonko District Description Available Need Obstacles to Investment Investment
Whole sale shops 4 Yes Retails shops (general) 103 Yes Financial institutions (banks) 2 Yes - High interest rate from the banks - Lack collateral for loan access Financial institutions (SACCOS) 5 Yes - Low capital investment Rural financial institutions 130 Yes - Low capital investment (VICOBA) No. of cooperative societies 9 Yes SMEs groups 144 Yes - Lack training on entrepreneurships Available comm. networks 5 Yes - Remoteness some villages Households with TANESCO power 415 Yes - supply % of people with Solar supply N/A Yes Roads networks (kms) 487 Yes Passable year around (kms 487 Yes No. of Vehicles N/A Yes Motorbikes 421 Yes Workshops/garages 4 Yes Shops selling spare parts 26 Yes Timber & furniture retails 7 Yes many of the furniture workshops are not registered Stationaries 8 Yes Milling machines (small scale) 56 Yes Lack of private investors Filling stations 1 Yes Kiosk/groceries 174 Yes Bakeries 1 Yes Hair saloon 54 Yes Tea/coffee rooms 12 Yes Video halls 31 Yes Source: Field Data, 2016
3.7Investment in Social and Health Services Social and health services are among the driving forces for economic development for any society. A well-educated society will have innovative contribution to the development. And society in good health provide string manpower for community development.
3.7.1 Investment in Health Services Kakonko district has no hospital. Health services that demand hospital level is offered in Kibondo district. The district council is looking an investor in health services especially for construction of the hospital. Having this constraint, people in the district make use of the existence 27 village dispensaries and 3 health centers located in, Nyamtukuza (Nyanzige), Gwanumpu and Kakonko wards.
Investment Opportunities Health Sector S/N Ward Dispensaries Pharmacies Health center Hospital 1 Kasanda 2 5 0 0 2 Kasuga 3 8 0 3 Kanyonza 1 3 0 0 4 Kakonko 3 8 1 0 5 Gwanumpu 3 1 1 0 6 Katanga 1 6 0 0 7 Nyamtukuza 1 1 1 0 8 Kiziguzigu 3 1 0 0 9 Gwarama 2 8 0 0 10 Muhange 1 4 0 0 11 Rugenge 2 4 0 0 12 Nyabibuye 2 4 0 0 13 Mugunzu 3 8 0 0 Total 27 61 3 0 Table 14: Investment Opportunities Health Sector
3.7.2 Investment Opportunities in Education Good investment in education sectors open green light toward society development. Data gathered from this study indicated that 57% of all people have completed primary education, 28% secondary school, 14% illiterate while none of the people interviewed have college education (Figure 10). This gives an impression of the agent need of investment especially in Kindergarten, English Medium Primary Schools, Secondary schools (. “O” Levels and “A” Levels), vocation training, and other colleges and universities to give some skills to the number of community members. Recently Kakonko District has only four Private Secondary Schools, and there are no private kindergarten, Primary Schools and Colleges, hence the great need for investment in education Sector.
Fig 10: Education Level in Kakonko District
Ranked as the least developed district in Tanzania, may be the outcome of lack of vocational skills to the majority of people in this community that can eventually improve employment opportunities. The is therefore the need to have an investment in vocation training centers in the district. The information gathered from this study indicate absence of any vocation training and college in the district. Investment in primary secondary education is also needed Table 15. Obstacles to investment in education sector in the district include;
• Lack of technical and financial capability for local investors • Complicated procedures and policies for investment • Lack of technical and financial capability for local investors • Complicated procedures and policies for investment
Table 15: Investment Opportunity in Education Services Source: Field Data, 2016
Investment Opportunities Education Sector S/N Ward Primary schools Secondary Vocational Colleges 1 Kasanda 7 1 0 0 2 Kasuga 7 1 0 0 3 Kanyonza 1 1 0 0 4 Kakonko 6 2 0 0 5 Gwanumpu 3 1 0 0 6 Katanga 3 0 0 0 7 Nyamtukuza 4 1 0 0 8 Kiziguzigu 5 2 0 0 9 Gwarama 6 1 0 0 10 Muhange 4 0 0 0 11 Rugenge 4 1 0 0 12 Nyabibuye 4 1 0 0 13 Mugunzu 5 1 0 0 Total 59 13 0 0
3.8 Revenue Collection from Investment It is the interest of the District Council to collect revenues from village level up to the district level. This study revealed an increase in revenue collection at both village and district levels. The 63% of all people interviewed agreed that their villages leader were able to collect revenues from their village investments. However, they doubted on the efficiency on expenditure of the revenue collected. But 43% of people who interviewed suggested better way of improving revenue collection to be tied on conducting education to the majority on the importance of tax paying. Other people, 29% recommended the government to review tax policy and set friendly policy to the tax payers. People were also suggesting the government to timely supply agricultural inputs such as fertilizers and improved seeds so as they can improve production and get surplus for selling. Enhancing agricultural production increases sells and revenue collection as well. But some people also expressed their concern on tax multiplicity and argued the government to review these taxes as indicated in figure 11.
Fig 11: Improving Revenue Collection
4. CHALLENGES FACING INVESTMENT IN KAKONKO DISTRICT Response from the interview on the obstacles to investment opportunities in Kakonko district most of the respondents had mixed comments. The respondents (38%) commented lack of entrepreneurship skills being the main reason. However poor market access, climate change and low capital to invest in the business sighted to be among the major obstacles. But when people asked whether there was conducive environment for investment in their village 100% commented to have favourable climate for investment. Their reference in this agreement was based on availability of resources for investment not the procedures leading to investment. All people (100%) under the interview also commented to have no any information about existence of LIC project in Kakonko District. His pose a challenge of access services offered by the project and call for urgent awareness on this project to the entire community of Kakonko. People in the village should also be aware on the project. When people asked specifically whether they had reliable market for their products, 77% of all respondents denied to have good market while 23% agreed to access market especially Burundian market. Based on this observation majority (69%) suggested the government to allow cross boarder business with Burundian countries especially for agricultural products. Market liberalization was also suggested by farmers to be a solution for market access as well as regular dissemination of market information to the all actors involved in business value chains.
Fig 12: Investment Challenges in Kakonko District
5. CONCLUSION Kakonko District despite being the least developed district in Tanzania is endowed with various resources that if exploited sustainably can upset down existing adverse economic situation in the district. Data gathered in this study indicated high level of investment opportunities hinged in agricultural and natural resources sectors. Potential investment is on increasing agricultural production, agro- processing and in livestock sector. Good investment opportunities are existing on exploitation of natural resource in term of mining, beekeeping and establishment of Community based Hunting Blocks that can improve district revenue collection as well as local community income.
However, despite of existing of these potential investment opportunities some obstacles to investment need to address to create conducive investment climate. These include improved local investment capital and local access to credit, community empowerment on entrepreneurship skill and improving market access to especially for agricultural products. Such motivating environment will improve commitment of local community in investment to various existing investment opportunities. While most of agricultural investment opportunities were suggested to be invested by the local people, respondents on the interview suggested mining industry to be promoted to external investors.