INTRODUCTION

This text aims to provide you with comprehension of the background of the

Private Sector Development Programme

for the Lake Zone

in Tanzania. The Lake Zone comprises the regions of Kagera, Mara, Mwanza and Shinyanga.

The Government of Tanzania gives high priority to the development of the private sector. The Government has realised that the private sector is essential for creating jobs and income.
The purpose of the Lake Zone Private Sector Development Programme (PSDP) is to facilitate and stimulate the creation of jobs and income through private sector led economic growth. This may occur through fostering public-private partnership in the regions, and dialogue between the (local) Government and the Private Sector. For that, a strengthening of the bargaining position of the private sector as a whole is a condition.

To contribute to these goals, the PSDP will assists the private sector in empowering its organisations ("WEZESHA"). Empowered Private Sector Organisations can engage as true partners in a dialogue with Government, through with obstacles for private sector led growth can be removed, opportunities indicated and the role of an enabling government further defined. This must lead to further sustainable private sector led growth.

Partnerships

The PSDP will work with different partnerships. These partnerships comprise the Private Sector Organisations, like regional or district TCCIA's, like zonal, regional or district organisations of enterprises or businessmen and -women etc. These partnerships can vary, and change over time. They have in common that the partners represent the business community or a part of it. Individual enterprises might be supported, but PSDP encourages partnerships.

As much as possible, PSDP will forge alliances with already existing organisations that are supporting the Private Sector to avoid reinventing the wheel or avoidable duplication of effort.

Objectives

A certain hierarchy of objectives can be recognised:

• Strengthen bargaining position of the private sector,
• Dialogue between the private sector and the government,
• Increased capacity of private sector organisations (interest groupings, IG),
• Service delivery by business development services (BDS).

Delivery of services is a valuable aspect of the relationship of the Programme and Private Sector Organisations. These services will be delivered by Private Sector Organisations, not by the Programme (through the services of experts; the Programme's experts will not be delivering services, but monitor the delivery).

By delivering such services, a means has been created towards the end: capacity building of private sector organisations (PSOs).

This increased capacity is again a means to the end: becoming a recognised partner in the required dialogue between the private sector and the government.

A "more level playing field" and a strengthened bargaining position of the private sector can be realised, as a result of the dialogue.

Trust

When discussing private sector development (PSD), many discussion partners indicate that the one most important factor hindering real further private sector development is the lack of trust between partners in the development process. Issues often mentioned include disagreement between the Tanzanian Revenue Authority (TRA, tax collector) and small enterprises. The programme needs to contribute to increased trust among all parties involved, be it regional or district government, private sector organisations, private sector operators (PSO), deliverers of services (BDS) and individual enterprises. Genuine dialogue should be the main way to enhance trust.

Projects

The PSDP has indicated a set of possible activities (projects) which will contribute to the objectives. Under subcontracting, these projects are further explained.

As mentioned, PSDP will not execute projects itself. It will look for available capacity in the local market for services to execute projects in subcontracted assignments. Thus, these organisations will be strengthened and PSDP is not out competing them. Successful executed assignments will also contribute to the recognition of the value of services.

Demand driven

PSDP works demand driven. It will not engage in activities if no clear demand can be defined. Demand will be visible if the supported organisation defines the need, and contributes to the activity in kind and/or financial. PSDP considers ownership of paramount importance. PSDP strives to stimulate local ownership and the use of local knowledge.

The area of its activities is vast, and the task at hand huge. PSDP will engage in such activities where it sees promising futures. It makes a deliberate choice for potential "winners" or winning organisations.

Definitions

While being in the field PSDP staff has learned that is necessary to start with some definitions. We have developed a few.

The need for a definition is not only because of a general lack of understanding, due to the period of socialism, or the often negative feelings about enterpreneurship found in most restructuring countries. It is necessitated by the fact that a definition or explanation will have to use the word business. In Kiswahili there is no word for "Business". The literal translation for business ("BIASHARA" in Kiswahili) portrays the meaning of commerce, trading, manufacturing activities only; other activities such as agriculture and services are left out.
Due to the past economic orientation of Tanzania, when you talk of Private Sector or Business, many people including policy makers still harbour the feelings and attitude that you are talking of nonagricultural activities or the relatively larger businesses; at best it is "Capitalism" or "UBEPARI".

The Private Sector includes all individuals or groups of people or a freely formed associations and companies (who do not have the ownership or direct control of the Government) in carrying out their day-to-day business activities. The result and consequence of their efforts is their own responsibility.
In this context then, Income Generating Activities (Mama N'tilie, Mama Mboga, Baba Mkokoteni, the small farmer out there), Micro Enterprises, Small, Medium, Large Enterprises all form the PRIVATE SECTOR.
The Private Sector is not one homogeneous whole, but rather a mixture of different sub-sectors and groupings that have similar characteristics, interests, constraints, problems etc. It is therefore of interest to address the different sub-sectors at a lower level and associate them in larger grouping at a higher forum level for maximum coverage.

Advocacy is taken to be trouble making. The consequences to trouble makers can be far reaching for the well being of an individual(s) or group. Thus, it became very important to generate a common understanding of what Advocacy is and Advocacy groups are, through a "plausible" easy to understand definition:
Advocacy is meant to be promulgate "INTEREST GROUPS" that are more of a solution finding, experience sharing and opportunities finding nature. Advocacy is not meant to propagate "PRESSURE GROUPS" which are of a confrontational nature. Government need to be closer to the Private Sector; there should not be suspicion and hard feelings about each other.
The advocacy forum should not be limited to solving problems only but should also discuss opportunities improvements and new and better ways of doing things for all parties.