East African block to create 56,000 new jobs

briefcaseEast Africa is expecting increased job opportunities due to greater foreign investment. (Image source: Jason M)Tanzania is to lead East African countries in creating more than 56,000 employment opportunities over the next five years, according to Ernst and Young

The consulting firm’s latest report, entitled ‘Africa Attractiveness Survey Building Bridges’, showed that during the next five-year period the East Africa region will collectively create 56,300 jobs, primarily resulting from capital inflow from foreign investors.

Of the prospective occupations, Tanzania is expected to account for the largest share at 49 per cent, or 28,000 jobs.

In 2011, the unemployment rate in Tanzania was estimated at 10.7 per cent.

The report noted that the mining and oil and gas industries in the East African block would continue to attract foreign direct investment (FDI). Particularly, the discovery of oil in northern Kenya and western Uganda, which has created substantial wealth and is expected to attract significant FDI.

 According to the report, 16,000 employment opportunities will open up in the Kenyan economy, as well as 11,000 in Uganda, and 1,300 in Rwanda.

This investment, in turn, will spur economic growth, improve livelihoods and reduce the problem of unemployment.

The region’s low level of bureaucracy and diversified economic services, such as communications, financial services, and political stability, are also expected to attract foreign investors, mainly in Tanzania.

The inflow of FDI has been climbing.  Tanzania attracted US$13.2 billion between 2003 and 2011, with the bulk going into resources. Over the following five years, Kenyan FDI inflow is forecast to average at $1.3 billion, and the figure is expected to increase following the oil discoveries by Tullow Company.

The East Africa Community (EAC) secretary, Dr Richard Sezibera, said, “The EAC is enjoying great growth in terms of direct foreign investment, attracted by the area’s natural resources endowment, growing economies, and integrating markets.”

Sezibera further noted that the region is globalising rapidly. The value of its total international trade had doubled from $17 billion in 2005 to $37 billion in 2010, seeing the expansion of the economy’s share.

EAC officials also note that in addition to the recent oil and gas discoveries, the deployment of Ugandan, Burundian, and Kenyan troops to Somali; the fourfold increase from $15 million to $60 million in counter-terrorism funding to EAC; and the arrival of 100 US military advisers to Uganda, all continue to demonstrate the region’s growing influence in global geopolitics.

Mwangi Mumero

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