Tanzania To U.S. And China: U.K. Is No. 1 For Investment

Tanzania To U.S. And China: U.K. Is No. 1 For Investment

Sino-U.S. competition over East Africa’s second largest economy is misplaced, according to Tanzania’s president Jakaya Kikwete.

That’s because another country has already outpaced the No. 1 and No. 2 world economies when it comes to money and influence in Tanzania, according to a report in Quartz.

At a conference in Washington, D.C. last week, Kikwete told U.S. lawmakers, “I would like to assure you that there is no interference by the presence of Chinese companies in Tanzania. Perhaps, U.S.A.…companies should fear the U.K. in terms of investment.”

Tanzania has become the focus of rivalry between China and the U.S., the report said. Foreign companies are attracted to Tanzania because of its growing economy (6.9 percent in 2012), relatively stable politics, and recent discovery of offshore natural gas deposits.

China’s president Xi Jinping stopped there on his first diplomatic tour and signed more than a dozen trade and diplomatic agreements. About three months later, Barack Obama made a stop, promising $7 billion to upgrade the country’s electricity infrastructure.

Even though China replaced the U.S. as Tanzania’s fourth largest investor in 2012, they’re both well behind Great Britain. U.K. firms like oil and gas company BG Group and brewer SABMiller have invested $4.7 billion in Tanzania, making the U.K. the country’s largest foreign direct investment contributor in 2012.

As much as 60 percent of foreign investment in Tanzania is British, according to the U.K.’s former high commissioner. After the U.K. are India and Kenya. China contributed $1.4 billion and the U.S. $950 million.

Kikwete’s words could be aimed in part at goading the U.S. to increase investment and overtake China once again, the report said.

In July, Tanzania’s envoy to the U.S. said that U.S. companies were getting left behind “not (only) by the Chinese, but by the Brazilians, the British, the South Africans, the Germans, you name it.”