50ParkPlace,Suite1003Newark,NJ07102Tel:+1(973)679-6870

AReviewofNationalFertilizerRegulatoryAuthoritiesinTanzania

September2016

PreparedbyAFAP

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ACKNOWLEDGEMENTS

ThisstudywascommissionedbytheAfricanFertilizerandAgribusinessPartnership(AFAP).

It ispartofasetofstudiescovering4countriesinEasternandSouthernAfricainSupport

fortheEstablishmentofaRegionalFertilizerPolicyandRegulatoryFrameworkforEastand

SouthernAfricawhich is fundedby theAlliance foraGreenRevolution inAfrica (AGRA)’s

ScalingSeedsandTechnologiesProgram(SSTP).WearegratefultoMrDavidKijaziandAFAP

Tanzania countryoffice for their facilitation role theyplayed throughout the studyand to

institutionsandindividualswhichwereinterviewed

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ACRONYMS

AGRA AllianceforaGreenRevolutioninAfricaAFAP AfricanFertilizerandAgribusinessPartnershipACTESA AllianceforCommodityTradeinEastandSouthernAfricaAMOFERT MozambicanAssociationforFertilizersCOMESA CommonMarketforEastandSouthernAfricaFAK FertilizerAssociationofKenyaFAO FoodandAgricultureOrganisationIFA InternationalFertilizerAssociationIFDC InternationalFertilizerDevelopmentCentreIFPRI theInternationalFoodProductionResearchInstituteMAFC MinistryofFoodSecurityandCooperativesMTI MinistryofTradeandIndustryNEMC NationalEnvironmentManagementCouncilSGS SocieteGeneraledeSurveillanceSSTP ScalingSeedsandTechnologiesProgramTABIRA FertilizerAssociationBurundiTBS TanzaniaBureauofStandardsTFC TanzaniaFertilizerCompanyTFDA TanzaniaFoodandDrugsAuthorityTPA TanzaniaPortAuthoritiesTFRA TanzaniaFertilizerRegulatoryAuthorityTFTA TanzaniaFertilizerTradeAssociation

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EXECUTIVESUMMARY

An assessment of the national fertilizer regulatory authorities in Tanzania reveals that

fertilizer production/importation, distribution, marketing and trade is regulated and

controlledbymultipleinstitutions.TheseinstitutionsareestablishedunderdifferentActsof

theLawsofTanzania.Incarryingouttheirmandates,theseinstitutionsalsodrawfromtheir

specific Acts, policies and regulations. This often leads to conflicts and/or overlaps and

replication making it difficult to reach consensus on certain issues. Further, there is no

nationalfertilizer-specificcoordinatinginstitutionthatguidesandcoordinateseffortsofthe

variousinstitutionstoavoidoverlapsand/orreplicationofefforts.Theweakregulatorylegal

instruments and harmonization standards undermine comprehensive and effective

coordinationinfertilizerproduction,markinganddistribution.

Inordertoaddressthesechallenges,improveagriculturalproductionandfoodsecurityand

establishameansthroughwhichgovernmentandtheprivatesectoroverseethefunctioning

ofthefertilizersector,thisreportmakesthefollowingrecommendations:

a) Strengthen the TFRA: In order to effectively coordinate the efforts of the variousinstitutions that are involved in fertilizer regulation there is need for improvedfundingandtrainingofTFRAofficials.InadditiontoavoidunnecessaryredtapeTFRAshouldadopttheone-stopshopmodel.

b) Train and gazette fertilizer analysts and inspectors: Like other COMESAmember

states,Tanzaniadoesnothaveanadequatepoolofqualifiedandgazettedfertilizeranalystsandinspectors.Toeffectivelyenforcefertilizerrulesandregulations,thereis need for trained and gazetted fertilizer analysts and inspectorswith knowledgeandunderstandingofregulatory.Theseofficersshouldbegazettedtogivethemthepowertotaketocourtallthosewhodonotcomplywiththerulesandproceduresforfertilizertesting.

c) Refurbishandequiptestinglaboratories:TFRAneedssupporttoconstruct itsown

laboratories.TodatetheagencyhasbeendependingonthelaboratoriesatTanzaniaBureau of Standards. In constructing these labs attention should be given toestablishmentofmicrobiologicallaboratoriesfortestingbio-fertilizerproductsintheTanzanianmarket.

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d) Creating awareness and linkages with national and regional fertilizer regulatoryauthorities: There is need for the government to conduct campaigns to createawareness and educate agrodealers, farmers and the general public on differentfertilizersinthemarket,andthebenefitsandsafeuseoffertilizers.Priorityshouldalso be given to working with private sector stakeholders in the fertilizer sector,buildingthecapacityoffertilizerregulatorsandcreating linkageswithnationalandregionalfertilizerassociations.Anannualmeetingofnationalfertilizerregulatorstoshare experiences and emerging issues and working with regional fertilizerassociations, and private sector forums such as the East and Southern AfricaFertilizer Trade Platform (ESAF), is also recommended. In addition the on-goingproject on installation of an e-portal to improve ICT infrastructure in general iscrucial;thiswillhelptooptimizeTFRA’sefficiencyandprovidealinktotradersandother relevantstakeholders toapply forvarious licensesandpermits fromasingleplatform. Computers will be needed to enable networking with inspectors in thedistricts.

e) Capacitybuildingoffertilizerinspectorsandlawenforcersatdistrictandnational

levels;Toenableeffectiveenforcement,regulartrainingofinspectorsandotherlaw

enforcersincludinglegalofficersinthedistrictsshouldbeintroduced.

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TABLEOFCONTENTS

ACKNOWLEDGEMENTS....................................................................................................................IACRONYMS....................................................................................................................................IIEXECUTIVESUMMARY...................................................................................................................IIITABLEOFCONTENTS......................................................................................................................VLISTOFFIGURESANDTABLES........................................................................................................VISECTION1:INTRODUCTION............................................................................................................1

1.1 BACKGROUND.......................................................................................................................11.2 OBJECTIVESOFTHEASSESSMENT........................................................................................31.3 METHODOLOGY....................................................................................................................3

SECTION2:FERTILIZERLAWSANDREGULATIONSINTHECOMESAREGION....................................52.1 FERTILIZERREGULATIONS.....................................................................................................62.2 FERTILIZERREGULATORYAUTHORITIES................................................................................72.3 FERTILISERREGULATIONSENFORCEMENTCAPACITY..........................................................7

SECTION3:TANZANIA’SFERTILIZERINSTITUTIONALFRAMEWORK.................................................83.1 MINISTRYOFFOODSECURITYANDCOOPERATIVES(MAFC)..............................................103.2 TANZANIAFERTILIZERREGULATORYAUTHORITY(TFRA)...................................................103.3 TANZANIABUREAUOFSTANDARDS(TBS)..........................................................................113.4 MINISTRYOFTRADEANDINDUSTRY..................................................................................123.5 TANZANIAPORTAUTHORITIES...........................................................................................123.6 TANZANIAFERTILIZERSOCIETY(TFC)..................................................................................133.7 ATOMICENERGYCOMMISION(ATC)..................................................................................133.8 TANZANIAREVENUEAUTHORITIES.....................................................................................133.9 PRESIDENTIALSERVICEDELIVERYBUREAU.........................................................................143.10 AGRICULTURALCOUNCILOFTANZANIA.............................................................................143.11 CHAMBEROFCOMMERCE&INVESTMENTCENTRE...........................................................15

SECTION4:FACTORSAFFECTINGFERTILIZERLEGISLATIONINTANZANIA......................................154.1 PROLIFERATIONOFNATIONALINSTITUTIONSREGULATINGFERTILIZER...........................154.2 LIMITEDCAPACITYTOENFORCEREGULATIONS.................................................................154.3 INADEQUATEFACILITIESFORTESTINGANDANALYSISOFFERTILIZERS.............................16

SECTION5:CONCLUSIONSANDRECOMMENDATIONS..................................................................166 REFERENCES.......................................................................................................................187 ANNEXURES........................................................................................................................19

7.1 ANNEXURE1:LISTOFINTERVIEWEDKEYINFORMANTS....................................................19

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LISTOFFIGURESANDTABLES

Figure1: Aconceptualframeworkforinstitutionalanalysis..........................................................4

Figure2: Tanzania’sfertilizerinstitutionalframework...................................................................9

Table1: Presenceofnationalfertilizer-specificregulatoryAuthorities(includingfertilizerLaws)inCOMESAmemberstates..................................................................................................5

Table2: Listofinterviewedkeyinformants................................................................................19

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SECTION1:INTRODUCTION

1.1 BACKGROUND

The economies of eastern and southern Africa are heavily dependent on agriculture. It is

estimatedthatmorethan70%ofthepopulationinthisregionisinvolvedinagricultureandthe

majority of these producers are smallholders farming less than two hectares. Agriculture

contributesonaverage35%ofGDPandemploys65%ofthepopulation.Therefore,agriculture

is a critical driver of the future economic development of the region. However, while

economies inmanyAfricacountrieshaveexhibitedhealthygrowth - realGDP insub-Saharan

Africagrewatanaveragerateof5%between2003and2009-thisgrowthhasnotemanated

fromtheagriculturesector(CamaraandEdeme,2013).

Despite its importance to the economy, the performance of the agriculture sector is poor.

Cerealyields insub-SaharanAfricaarethe lowest in theworld,havingstagnatedataround1

ton/haforthepast50yearscomparedto4tons/ha indevelopingcountries.Thekeyreasons

for the poor performance of the agriculture sector are the continued reliance on traditional

agricultural practices in the region and the low adoption of modern productivity enhancing

technologies suchasmineral fertilizersandquality seedsof superior varietieswhich severely

constrainincreasedyieldsinEastandSouthernAfrica.

Farmers in the region use on average 10 kg of fertilizer per hectare, compared to their

counterparts in Asia who consume on average 209 kg/ha. The result is severe soil nutrient

depletion;theratesofsoilnutrientdepletionexceed60kg/ha(WanzalaandGroot,2013).This

lowrateofusageisduetoanumberofreasonsincludingathinnetworkofagrodealers;lackof

technicalknowledgeonappropriatefertilizers;lackofaccesstofinanceallalongthevaluechain

whichprohibitsthepurchasesofsufficientquantitiestocaptureeconomiesofscale;andhigh

transport costs due to inadequateports, rail and roadnetworks. These factors result in high

costs,puttingfertilizerbeyondthereachofmostfarmers.

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Thepolicyenvironmentoftenexacerbatesthesituation.Governmentsubsidyprogramscrowd

outcommercialdemandandintroduceuncertaintyintothesystem,whichcreatesdisincentives

for private companies to invest in distribution networks. Government’s lack enforcement

capacity tooverseequality control,which increases the riskof adulterated fertilizers, fosters

distrustof fertilizeranddiscourageshonestbusinesspeople fromparticipating in the fertilizer

trade. Outdated fertilizer recommendations in many African countries are outdated due to

defunctornon-existentresearchandextensionsystems.

Similarly,governmentsubsidyprogramsoftendonotinvolvetheprivatesectorinplanningand

distribution.Hencetheprivatesectorhasnoincentivetoidentifywhichnutrientsfarmersneed

fortheircropsandsoilsandprovidetheappropriateblends.Moreover,governmentpolicy in

many of these countries discourages blending. Many countries have a list of approved

fertilizers. If the private sector wants to introduce a new fertilizer it must undergo efficacy

testing,whichcantakethreeyearsthusimposingcoststheprivatesectorcannotafford. The

listorapprovedfertilizerproductsalsodiscouragescross-bordertradeandthedevelopmentof

regionalmarkets.Countrieshaveverystrictspecificationsforapprovedfertilizers,andalthough

often thereareveryminordifferences innutrientcontent thesedifferencescan result in the

entryofanewfertilizerproductbeingdelayedorevendenied.

TheoutcomeoftheseconstraintsisthatfertilizermarketsineasternandsouthernAfricahave

failedtoreliablyprovidetherighttypeofqualityfertilizerstosmall-scalefarmers intherural

interiorinatimelymannerandatanaffordableprice.Ifagricultureintheregionistobecome

competitive,theperformanceofthefertilizermarketsintheregionneedstobeimproved.

Clearly no single interventionwill address these constraints effectively. Rather, a number of

interventions are required and many must be implemented simultaneously. These include:

investments in ports, roads and rail infrastructure to reduce transport costs; provision of

technical and business training to agro dealers; improving access to finance all along the

fertilizer value chain; and development of market information systems. However, an

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overarchingfactortofosterthegrowthoffertilizermarkets isastableandtransparentpolicy

andregulatoryenvironmentthatisconducivetoprivatesectorinvestment.

This study support SSTP’s mission and foster the creation of stable and conducive fertilizer

policyandregulatoryenvironmentintheregionbydoingthefollowing:

1) Developaregionalpolicyandregulatoryframeworkthatcanbeusedasaguide

bycountriesinEastandSouthernAfricatoembarkonapolicyreformagendafor

the fertilizer sector that will result in higher levels of fertilizer use and

concomitanthigherlevelsofagriculturalproductivityandfoodsecurity;

2) Prepare/revisedraftfertilizerlegislationforTanzania-whichiscompatiblewith

openmarketsandareharmonizedwitheachother;

3) Review and critique of Tanzania’s trade policies that impact fertilizer and

recommendationsforcommontradepolicies;and

4) Establish Tanzania’s action plans that also detail the requirements for

establishingfertilizerregulatorysystemsineachcountry.

1.2 OBJECTIVESOFTHEASSESSMENT

This report presents a review of national fertilizer regulatory institutions in Tanzania.

Specificallythereportattemptstodothefollowing;

a) Identify the presence of national fertilizer regulatory authorities in Tanzania and their

inherentcharacteristics

b) RecommendwaysofstrengtheningtheseinstitutionsforfertilizerregulationinTanzania

c) Recommendwaysoffacilitatinglinkagesbetweentheseinstitutionsinthefertilizerdomain.

1.3 METHODOLOGY

Both primary and secondary data collection techniqueswere employed. Secondary datawas

gathered through literature review on fertilizer policies in Tanzania. A number of literature

were consulted which includes previous work done by IFDC, AFAP, ACTESA, IFA, FAO in

Tanzania. In addition to this, National fertilizer policies and regulations were also reviewed.

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PrimarydatacollectionwasdonethroughinterviewswithkeyinformantswithintheTanzania

fertilizeractiondomain.InparticularthereportidentifiestherelevantplayersintheTanzanian

fertilizer domain and their attributes which have bearing on the fertilizer policy outcome

consequently influencing theenvironment.Figure1 indicates theschematic relationshipsand

interactionoftheenvironmentandthefertilizeractiondomainofTanzania.

Figure1: Aconceptualframeworkforinstitutionalanalysis

Adaptedfrom: InstitutionalEconomicsPerspectiveonAfricanAgriculturalDevelopment,2009;Kirstenetal

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SECTION2:FERTILIZERLAWSANDREGULATIONSINTHECOMESAREGION

Over80 percentofCOMESAmember stateshave legislations that regulate theproduction,

importation,distributionanduseof fertilisers. Theseareadministered throughoneormore

Ministries which include Ministries of Agriculture, Ministries of Trade, and Treasury. The

Ministry of Agriculture has vested interests in the production, importation, marketing,

distribution,standardsanduseoffertilizer.TheMinistryofTradeisconcernedissuesrelated

to the importation, distribution and export of fertilizers, including setting and enforcing

standards and the issuance of trade licenses while the Treasury has interest on revenues

(fertilizer taxes and duties). Coordination of such activities requires the presence of strong

institutionstoavoidcorruptionandrentseekingbehaviouramongregulatoryauthorities.

According to a study undertaken by the International Food Production Research Institute

(IFPRI, 2012) the countries that have promulgated specific legislations on fertiliser included

Burundi, Kenya, Uganda Zambia, and Zimbabwe. Those that have fertiliser policies or

strategies(drafts/final)includeEthiopia,Malawi,Kenya,Uganda,andZimbabwe.

Table 1 indicates COMESAmember states which have established national fertilizer specific

regulatoryauthorities,nationalfertilizerlawsandnationalfertilizerassociations.Outofatotal

of22countries,onlysix (6)haveestablishednational fertilizer-specific regulatoryauthorities;

andonlyfive(5)haveestablishednationalfertilizerassociations.

Table1: Presence of national fertilizer-specific regulatory Authorities (including fertilizerLaws)inCOMESAmemberstates

Country

NationalFertilizerSpecificRegulatoryAuthority

NationalFertilizerSpecificLaw NationalFertilizer

TradeAssociationBurundi NO YES YES(TABIRA)Comoros Djibouti NO NO NODRC NO NO NOEgypt Eritrea Ethiopia YES YES NOKenya NO NO YES(FAK)

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Libya Madagascar NO NO NOMalawi NO NO YESMauritius YES YES NOMozambique YES YES NOSeychelles NO NO NOSwaziland NO NO NORwanda YES YES NOSouthSudan NO NO NOSudan YES YES NOTanzania YES(TAFRA) YES YESUganda NO NO NOZambia NO NO YESZimbabwe YES YES YES(Informal)

Source: “Towards a framework for harmonization of fertilizer policies and regulations: Anationalandregionalsynthesisreport”,2014

2.1 FERTILIZERREGULATIONS

MostCOMESAmemberstateshavesomeformoffertiliserregulationsinplaceparticularlythe

twoelements thatpertain to registrationof fertiliseroperationsand inspections.Regulations

usuallycompriseof6distinctareaswhichinclude:

(i) Registrationofbusinessesand/ortheirproducts;

(ii) Inspectionof fertilizer premises, products and recordsby authorized inspectors(taking

samples,notingthelegalityofthelabels,checkingbagweights,inspectingrecords,etc.);

(iii) Analysisofsamplestakenbyinspectors;

(iv) Financing of the regulatory program through registration and inspectionfees;

(v) Administration,enforcement,andassessmentofpenaltiesbyadesignatedauthority;

and,

(vi) Publicationoffindings.

Thechallengeinfertilizerregulation,however, is that therearesomeomissionsofsomeof

theelementswithintheseregulationsrenderingthemincomplete. Themost commonmissing

element is thatofpublicationsof resultsoffertiliseranalysis,findingsofinspectionsandcourt

verdicts.Secondly,therearenointer-countrystandardproceduresorguidelinesforinspecting

premises, sampling, penalization and appointing inspectors. This may compromise

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transparency. As such the theory of incomplete contracts, moral hazards, shirking and

adverseselectionmaycomeintoplayinmostfertilizermarketswithintheregion.Itisforthis

reason that little progress has been made in the coordination and harmonization of these

activitiesattheregionallevel.

2.2 FERTILIZERREGULATORYAUTHORITIES

Institutions vested with the authority to administer the regulations vary from country to

country. Nonetheless the Ministry of Agriculture plays a central role in fertilizer

regulations in COMESA region. Apart from the Ministry of Agriculture (overall regulator),

there are also anumberof institutionswhich canundertake the inspections and/or analysis

which include Bureaux of Standards and international bodies such as SGS etc. There is

therefore,thequestionofwhoseinspectionoranalysiscarriesrecognition–nationalbureaux

or international bodies. Further, the documentation and inspections required of fertilizer

trans-shipments within the region varies from country to country. There are also no clear

policiesorguidelinesthatensurethatrevenueleviedoninspections,registrationandanalysis

is channelled back into enforcing the regulations. In some countries itgoestoTreasuryin

othersitisputinapoolofrevolvingfundswithintheMinistrythatadministerstheregulation.

Itsuseforstrengtheningtheenforcementoftheregulationcannotthereforebeguaranteed.

2.3 FERTILISERREGULATIONSENFORCEMENTCAPACITY

AlthoughalargenumberofCOMESAmemberstateshaveregulationsonfertiliserregistration

and inspection only about 50per cent of these are carrying outinspections.Thisisdueto

inadequatemanpowerandfinancial resourcestoundertakethistask.Forexample,Kenyahas

about70inspectorsagainst6200agro-dealers,importersandwholesalersoffertilisers;Uganda

hasabout50 inspectors againstover1000agro-dealers and importers;Burundi has about4

inspectors; Zimbabwehasabout8and, Egypthas slightlyover60 inspectorsdespite its large

consumption of fertilisers of over 10 million metric tonnes. In addition there is limited

infrastructure to aid the inspectionwork. In particularmost analytical laboratories are in

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adequately equipped to fully facilitate for analytical work. (COMESA/ACTESA Proposal on

fertilizer harmonization, 2014). The following section outlines institutions for fertilizer

regulationsandlegislationinTanzania

SECTION3:TANZANIA’SFERTILIZERINSTITUTIONALFRAMEWORK

UnlikemostoftheCOMESAmemberstates,Tanzaniadoeshaveanationalfertilizerlawwhich

regulatesthefertilizerindustry.TheFertilizerAct(2009)givestheTanzaniaFertilizerRegulatory

Authority (TFRA) the powers to govern the industry.Nonetheless theMinistry of Agriculture

andotherquasi-governmentalorganisationareactiveintheregulationoffertilizer.Anumber

of government Ministries administer different aspects of fertilizer regulations/ legislation.

These include: Ministry of Agriculture which plays the central role of national regulatory

authoritywith responsibility for registration, production, importation, distributionanduseof

fertilizers (including, inspection, testingof imported fertilizerunder thegovernmentsubsidy),

theMinistryofCommerce,Tradeand Industry,whichhas interests inaspectsof importation

anddistribution includingsettingandenforcingstandards, issuanceoftrade licences;andthe

Portauthorities. InadditiontotheMinistryofAgriculture,otherstatutorybodiesalsohandle

different aspects of fertilizer regulation. These quasi-government institutions include; the

TanzaniaBureauofStandards(TBS)andtheAtomicEnergyCommission.

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Figure2: Tanzania’sfertilizerinstitutionalframework

1. Policy statements on fertilizer issues are containedin the National Agricultural Policy produced in 20132. Fertilizer law enacted in 20093. No bio-fertilizers and blends policy

1.Fertilizersubsidies(evouchersystem2. Fertilizer packaging in smallquantities

1.Poor road and rail net works2. Port infrastructure poor3. Poor agro dealer network4. 17 suppliers registered with TFRA, butonly 6 major ones (oligopolisticmarket)

340 000mt marketsize

MinistryofAgriculture

TBS ACT/farmers

PortAuthorities

PresidentialServiceBureau

Chamberofcommerce/&InvestmentCentre

2 1

3

ClearingAgents

C

Outcomes• Average fertilizer use is

9kg/ha; soil nutrientneeds unmet due tolimited range ofregistered fertilizer

- eliminate VAT 18% onfertilizer services;reduce/eliminate portcharges

- Congested ports- Limited soil mapping to

inform blending- Fertilizer

recommendations areoutdated

- TFRA a one stop centre

A B

D

BusinessRegistration

FertilizerRegistration

Importing,ExportingandBlendinglicense

TanzaniaFertilizerSociety

RevenueAuthorities

Fertilizerregulation

TFRA

FertilizerregulationsEnforcement FertilizerUse

MinistryofTradeandIndustry

AtomicEnergyCommission

5

6 7

9 10

8

4

11 12

15

14

13

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3.1 MINISTRYOFFOODSECURITYANDCOOPERATIVES(MAFC)

TheMinistry of Food Security and Cooperatives still plays a central role in the regulation of

fertilizers in the country. Despite the provision of the 2009 Act which gives powers to the

Tanzania Fertilizer RegulatoryAuthority (TFRA) to register and license fertilizer dealers, issue

import permits, undertake training of inspectors, and collect andmaintain data on fertilizer

imports and use, these functions are still performed byMAFC. Furthermore, the Agriculture

Inputs Section of the Ministry of Food Security and Cooperatives (MAFC) functions as a

regulatorybodyforthefertilizersector.Fertilizerimportersareregisteredandrequireapermit

fromthisUnit.

3.2 TANZANIAFERTILIZERREGULATORYAUTHORITY(TFRA)

UnderthenewacttheTRFAisresponsiblefortheissuanceofbusinesslicences.Foronetobea

fertilizer traderonehas toobtainabusiness license fromTFRAasa fertilizer traderandalso

obtaina trading license from localauthorities forbusinesspremises. Forone to registerasa

fertilizertraderonealsoneedstohavereliablestoragefacilities.Thelicensingprocesswiththe

TFRAandlocalauthoritiestakesamaximumperiodoftwomonths.Theselicensesarevalidfor

ayearandhavetoberenewedannually.OnpapertheTanzaniaFertilizerRegulatoryAuthority

(TFRA) remains the main fertilizer regulatory and enforcement authority in Tanzania. This

agencyisresponsibleforthebulkofregulatoryworkincluding:

• Regulateandcontrolimportation,production,transportation,tradingstorage,disposal

andexportationoffertilizersincludingissuanceofpermits;

• Registrationofnewandapprovedfertilizers;

• Issuepermitsforimportationandexportationoffertilizers;

• Registrationandlicensingofallfertilizerandsupplementtraders;

• Maintainaregisteroffertilizers,supplementsandsterilizingplants(sterilizingplants

applytofertilizerproduction,blending,storageandsalesfacilities);

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• Qualitycontrolenforcementandregulationofallmattersrelatingtoqualityof

fertilizers,fertilizersupplementsandsterilizingplants;

• Publishfertilizerstatisticsandalistofregistereddealers;

• Promotesafeandeffectiveuseoffertilizer(publicandstakeholderawareness).

TFRAenforcestheFertilizerActof2009whichstatesthatnofertilizerorfertilizersupplement

shall be used in Tanzania unless it has been sampled, tested, analysed, evaluated and

recommended for use. All imports have to conform to these standards. In addition TFRA

performssurpriserandomchecks,samplingandothercontrolsperiodicallyalongthefertilizer

supplychannel.TFRAhasthejurisdictionalpowersofrevokinglicencesfornon-conformitywith

theprovisionsoftheAct.For instance,Greenbelt,aZambianblender,wasproducingtailored

blendsinTanzaniabasedonsoiltestingin2012.ItwasshutdownbyTFRAfornotmeetingthe

threeseasonstestingrequirement.

Although equipped with the Fertilizer Act of 2009, TFRA remains under-funded with few

professional staff, and hence poor staff motivation. It depends on 100 “inspectors” in the

districtswhosesalariesarepaidbytheMinistryofLocalGovernmentandwhoreporttolocal

districtgovernments.Theseinspectorsdonotprovidereliableinspection(andtesting)services

to TFRA, as they have multiple responsibilities and lack the resources (transport, testing

equipment)andtechnicalskill(propertakingofsamples)todotheirjobproperly.TFRAhasto

pay supplemental allowances for these inspectors to do site inspections.What should be an

important regulatorybody is, therefore,quiteweakdue toa lackof institutional andhuman

resource capacity. TFRA is alsomandated by the fertilizer law to provide indicative fertilizer

prices.

3.3 TANZANIABUREAUOFSTANDARDS(TBS)

Most fertilizer imports into Tanzania come through the port of Dar es Salaam, where the

TanzaniaBureauofStandards(TBS)ismandatedtoconductsampletestingforqualitycontrol

of fertilizer on arrival. Imported fertilizer has been designated for destination inspection in

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Tanzania(notpre-shipmentinspectionwherebyfertilizersareinspectedatsourceandthenTBS

would just certify that documentation to this effect is authentic). This is because fertilizer is

considered a high risk commodity by TBS. In terms of process, importers should apply for

testingoftheirsampletwoweeksbeforearrivalofthecargo.Onarrivaloftheproductasample

istakentooneofthelaboratories(TBShas9laboratories)andtestedagainstthesetstandard

toascertaincompliance. Itnormallytakes3days fortheresults tobereleased. If thesample

doesnotcomplywiththesetstandardsitisrejectedandtheimportercandecidewhetherthe

productistobedestroyedorsentback.Nore-exportingisallowed.

Themonitoring of fertilizer quality once it leaves the port falls under the jurisdiction of the

TFRA. Incarryingout itsdutiesTFRA isguidedbybaggingand labelling instructions issuedby

TBS. These instructions call for product identification,macro-nutrient percentages, the name

andcontactdetailsoftheproducer/importer,weight,themanufacturer’sexpirationdate,the

batchnumber,andthecountryoforigin.

3.4 MINISTRYOFTRADEANDINDUSTRY

ImportandexportlicencesareissuedbytheMinistryofTradeandIndustry.Agrodealersand

transportersarealsorequiredtoregistertheirbusinesswiththeMinistryofTradeandIndustry.

Therearenolawsandregulationsthat limittheregistrationoffertilizer importbusinesses. In

addition,the import licenseisfreeandit isusually issuedwithinthreedays if fullysupported

foreachconsignmentofregisteredproduct,andisissuedfortwoconsecutiveyears.Thereis

neither limitation on the amount of fertilizer to be imported nor import quotas that apply.

Therearenorestrictionsonforeignexchangeavailabilitytoimportfertilizerandthecurrencyis

stable.

3.5 TANZANIAPORTAUTHORITIES

TanzaniaPortAuthoritiesdealwithall importsandexportstoandfromthecountry.Theport

has limitedfertilizerhandlingterminalsandstorage.This isexacerbatedbypoorroadandrail

infrastructurewhichcausesunnecessarydelays inhauling fertilizers inland.Anumberofport

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chargesareleviedonfertilizerimportswhichincludeamongothers:wharfagechargesat1.6%

ofCostInsuranceFreight(CIF),handlingchargeof$4pertonne,rebaggingchargesat$8-16per

tonne,transporttothewarehouseat$5pertonne,portcorridorleviesat0.3%ofCIFandrail

developmentleviesof1.5%oftheCIF.Thesecostsaddupandincreasethefarmgatepriceof

fertilizer.

3.6 TANZANIAFERTILIZERSOCIETY(TFC)

The Tanzania Fertilizer Association was established in 1996 so it about 10 years old. It was

establishedtorepresenttheneedsandconcernsofimporterstotheGovernmentofTanzania.

ItsmainobjectiveistopresentonevoiceonfertilizerissuestotheGovernment,particularlyvis-

à-vispoliciesandregulationsthatimpacttheindustry.Itiscomprisedoffertilizerimportersand

manufacturers,sodoesnotincludeagrodealers.TFShasagoodrelationshipwiththeMinistry

of Agriculture. It regularly participates in policy and regulatory fora such as workshops and

conferences, andmeetswith theMinistry of Agriculture and the TFRA frequently to provide

theirinputonpolicyandregulations(itcontributedtotheFertilizerAct2009andregulations)

and keep the Government appraised on the status of fertilizer supply (current stocks and

importsinthepipeline),aswellasthekeypolicyissuesaffectingitsoperationswheretheyare

seekingredress.

3.7 ATOMICENERGYCOMMISION(ATC)

Importershavetosubmitsamplesofeachconsignment to theAtomicEnergyCommissionso

they can be tested for radioactivematerial, and to theWeight andMeasures Agencywhich

makessurethatfertilizerpackagingmeetsthesetstandards.

3.8 TANZANIAREVENUEAUTHORITIES

TheTanzaniaRevenueAuthority(TRA)isasemi-autonomousgovernmentalbodythatoperates

inconjunctionwiththeMinistryofFinanceandEconomicAffairs.TheTRAisresponsibleforthe

impartialadministrationofalltaxesimposedbythecentralGovernmentandthemanagement,

assessmentandcollectionoftherevenuegenerated.

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Fertilizer imports are exempt from VAT (18%) but taxes are imposed on services related to

fertilizer importation and distribution such as transport and port services such as storage.

Moreover,asisthecaseforanycompanythatoperatesasanimporter,fertilizerimportersincur

30%corporatetaxonprofitsregardlessofthesizeofthecompany.ThereisalsoVATleviedon

the rawmaterials imported tomanufacture fertilizer and fertilizer supplements.Nonetheless,

fertilizerexportsarezero-rated.Thereforeinthecaseoffertilizerthathasbeenimportedbutis

nowbeingre-exportedtheportionof fertilizer that isbeingre-exported iszero-ratedandthe

exporterwillbeentitledtoaVATrefundonvalueadditionservicesrenderedtothatportionof

fertilizer.

3.9 PRESIDENTIALSERVICEDELIVERYBUREAU

This is a quasi-governmental institution tasked to accelerate agricultural productivity in the

country by the Presidency Ministry of Tanzania through developing and implementing key

priorityfocusareasofnationaldevelopment.Todateithasbeenintheforefrontofdeveloping

a number of agricultural productivity frameworks which includes among others; the legal

framework of irrigation, fertilizer regulations amendment, the legal framework for contract

farming,thelegalframeworkoflandmanagement,legalaidclinicsandthecooperativesact.In

additionitalsoplaysacrucialroleinthedevelopmentofthesoilmapforTanzania(TANSIS).

3.10 AGRICULTURALCOUNCILOFTANZANIA

This isafarmerorganisationinstitutionlinkedtotheMinistryofAgriculturewhichlobbiesfor

profarmerpolicies.Forinstance,ithasbeenlobbyingforinvestmentinportfacilitieswhichwill

result in the reduction of port charges andhence a lower price for fertilizer. In addition the

organisationisworkingtodevelopaportaltradeplatformwherebothinputsandoutputcanbe

traded reducing transaction cost for both parties (sellers and buyers). The organisation also

plays the advisory role to the Tanzanian government on inputs subsidies. It is currently

implementingapilotstudyone-vouchersincollaborationwithNORAD.

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3.11 CHAMBEROFCOMMERCE&INVESTMENTCENTRE

These are the two private sector driven national institutions which are instrumental in

attracting investments into the country. Nonetheless they are crippled by outdated policies,

lawsandregulations.Forinstance,theNationalInvestmentPromotionPolicywaslastreviewed

in1996anditdoesnotsuitthecurrentinvestmentenvironment.

SECTION4:FACTORSAFFECTINGFERTILIZERLEGISLATIONINTANZANIA

4.1 PROLIFERATIONOFNATIONALINSTITUTIONSREGULATINGFERTILIZER

Although the 2009 Act gives powers to TFRA to register and license fertilizer dealers, issue

import permits, undertake training of inspectors, and collect andmaintain data on fertilizer

imports and use, these functions are still performed by the Ministry of Food Security and

CooperativesandtheAgricultureInputsSectionoftheMAFCfunctionsasaregulatorybodyfor

thefertilizersector.

Thereisalsoamultiplicityofinstitutionsinvolvedduringtheclearingoffertilizerimports.This

hasimplicationsforfeeschargedandthetimetakentocompletetheclearingprocess.During

clearingprocess, importersarerequiredtogothroughthefollowingregulatory institutions: i)

Tanzania fertilizer regulatory authority (TFRA), ii) Tanzania Bureau of Standard (TBS), iii)

RadiationCommission,iv)Chiefchemists,v)Weight&MeasureAgencyandvi)SUMATRA.Once

the importer clears the product with the above institutions, the importer can lodge with

TanzaniaRevenueAuthorityandthePortAuthority.

4.2 LIMITEDCAPACITYTOENFORCEREGULATIONS

TodateTFRAhasjustabout100inspectorswhoareillequippedandilltrained.Moreover,the

enforcement authority lacks capital and is understaffed with only three staff, the director,

assistantandoneofficer.Thisconstrainedorganizationalstructureclearlyimpactsitsabilityto

performatrequiredlevelsandkeeppacewithtothenumerousapprovalstheauthorityhasto

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dealwith. Capacity for enforcement should be strengthened,with a focus on regular quality

inspectionsattheretaillevel.

4.3 INADEQUATEFACILITIESFORTESTINGANDANALYSISOFFERTILIZERS

TheTFRAdoesnothavelaboratoryfacilitiesofitsownandreliesonfacilitiesattheTBSandthe

National Soil Testing laboratory which is about 450 km away. There are 4 (four) testing

laboratories inthecountrywhichare ingoodworkingconditionandtheseareattheSokoine

UniversityofAgriculture(SUA)atMorogoro,theTanzaniaBureauofStandards, theMlingano

Agricultural Research Institute at Mlingano in Muheza, Tanga Region and the Government

ChemistinDaresSalaam.Whiletheseunitsaresaidtobedoingagoodjoboftestingfertilizer,

theyarefirstandforemostsoilandnotfertilizerlaboratories.Secondlytheyaredistancesapart

andindifferentpartsofthecountryhenceiftheyallhadtobeinvolvedintestingaparticular

item theexercise couldeasily takea long time. Third, these laboratories are severelyunder-

fundedandasaresulttheirtestresultsvaryfromeachotherandareinaccurate(MIRA2014).

SECTION5:CONCLUSIONSANDRECOMMENDATIONS

AnassessmentofthenationalfertilizerregulatoryauthoritiesinTanzaniarevealsthatfertilizer

production/importation, distribution, marketing and trade is regulated and controlled by

multiple institutions. These institutions are established under different Acts of the Laws of

Tanzania. Incarryingouttheirmandates,theseinstitutionsalsodrawfromtheirspecificActs,

policiesandregulations.Thisoftenleadstoconflictsand/oroverlapsandreplicationmakingit

difficult to reach consensus on certain issues. Further, there is no national fertilizer-specific

coordinatinginstitutionthatguidesandcoordinateseffortsofthevariousinstitutionstoavoid

overlaps and/or replication of efforts. The weak regulatory legal instruments and

harmonization standards undermine comprehensive and effective coordination in fertilizer

production,markinganddistribution.

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In order to address these challenges, improve agricultural production and food security and

establishameansthroughwhichgovernmentandtheprivatesectoroverseethefunctioningof

thefertilizersector,thisreportmakesthefollowingrecommendations:

f) Strengthening the TFRA: In order to effectively coordinate the efforts of the various

institutionsthatareinvolvedinfertilizerregulationthereisneedforimprovedfunding

andtrainingofTFRAofficials. InadditiontoavoidunnecessaryredtapeTFRAcanalso

adopttheonestopshopmodel.

g) Training and gazetting of fertilizer analysts and inspectors: Like other COMESA

member states, Tanzania does not have an adequate pool of qualified and gazetted

fertilizeranalystsandinspectors.Toeffectivelyenforcefertilizerrulesandregulations,

thereisneedfortrainedandgazettedfertilizeranalystsandinspectorswithknowledge

andunderstandingofregulatory

h) GazettetrainedMinistryofAgricultureFertilizerAnalysts:Togivethemthepowerto

take to court all those who do not comply with laid down rules and procedures for

fertilizertesting–litigationpowers.

i) Refurbishing and equipping testing laboratories: TFRA still needs support for

constructingitsownlaboratories.TodatetheagencyisdependingonTBSlaboratory.In

constructingtheselabscognisanceshouldbealsoplacedonmicrobiologicallaboratories

fortestingbio-fertilizerproductsintheTanzanianmarket

j) Creating awareness and linkages with national and regional fertilizer regulatory

authorities:ThereisneedforthegovernmentofTFRAtoconductcampaignstocreate

awareness and educate agrodealers, farmers and the general public on different

fertilizersinthemarket,benefitsandsafeuseoffertilizers,etc.Priorityshouldalsobe

giventoworkingwithotherprivatesectorstakeholdersinthefertilizersector,building

the capacity of fertilizer regulators and creating linkages with national and regional

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fertilizer associations. An annual meeting of national fertilizer regulators to share

experiencesandemerging issuesandworkingwith regional fertilizerassociations,and

private sector forums such as the East and Southern Africa Fertilizer Trade Platform

(ESAF), is also recommended. In addition theon-goingprojecton installationof ane-

portaltoimproveICTinfrastructureingeneraliscrucial;thiswillhelptooptimizeTFRA’s

efficiency and provide a link to traders and other relevant stakeholders to apply for

variouslicensesandpermitsfromasingleplatform.Computerswillbeneededtoenable

networkingwithinspectorsinthedistricts.

k) Capacity building of fertilizer inspectors and law enforcers at district and national

levels; To enable effective enforcement, regular training of inspectors and other law

enforcersincludinglegalofficersinthedistrictsshouldbeintroduced.

6 REFERENCES

1. Camara, O.M., and Edeme, J., 2013, Making Regional Fertilizer Markets Work for

SmallholderFarmersinAfrica

2. Wanzala,M.andGroot,R.,2013,FertilizerMarketDevelopmentinSub-SaharanAfrica.

PaperpresentedtotheInternationalFertiliserSocietyataConferenceinWindsor,UK,

on24thMay2013

3. Kirsten, J.F., Dorward, A.R., Poulton, C., and Vink, N., 2009, Institutional Economics

Perspectives on African Agricultural Development, International Food Policy Research

Institute

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7 ANNEXURES

7.1 ANNEXURE1:LISTOFINTERVIEWEDKEYINFORMANTS

Table2: Listofinterviewedkeyinformants

Name Institution DateMrLazaroWKitandu TanzaniaFertilizerRegulatoryAuthority 18-07-2016MrsBeatusNchota,MrAbdulBZuberi

TanzaniaRevenueAuthority 18-07-2016

MrsLatiffaAKigoda TanzaniaInvestmentCentre 18-07-2016MrSalumKMkumba FertilizerSocietyofTanzania/TFC 18-07-2016MrShenalSNyoni,MrsNkuvililwaJSimkanga

MinistryofAgriculture,LivestockandFisheries 19-07-2016

MinistryofIndustriesandTrade 19-07-2016MrsMaureeKwilasa OneAcreFund 19-07-2016 JointmeetingbetweenFertilizerSocietyof

Tanzania/TFCandMinistryofAgricultureforpresentation

20-07-2016

DrElizabethMaeda USAID 20-07-2016MrGeoffreyKirenga&MrEmmanuelyDLyimo

SAGCOT 20-07-2016

MrTesfayeLegesseObole PresidentialDeliveryBureau 20-07-2016MrLazaroHenryMsalaga TanzaniaBureauofStandards 20-07-2016MrMarkKMagila&MrsJanetFBitegeko

AgriculturalCouncilofTanzania 21-07-2016

MrsMagdaleneMkocha TanzaniaChamberofCommerce,IndustriesandAgriculture

21-07-2016