Finnish minister speaks out on Tanzania's investment climate

Question. Mr Skinnari, you’re most welcome to Tanzania and thanks for this opportunity to talk to us about the mission of your tour and how you look forward to strengthening Finland’s relations with Tanzania. To start with, on behalf of people who are not very familiar with the Finland-Tanzania relationship, would you take some minutes to describe the current relationship between the two countries?

Answer. Of course. I think we have to go quite long back in history. If you look at the past decades we have been very active in Tanzania and this has not only been between the two governments but also between their respective people. And of course, we have Finnish people, and politicians like former President Mr Martti Ahtisaari, a Nobel laureate, who served here as ambassador. So I think we have had some very great cooperation which has made our relationship special.

And now is the time to look at the future together. Of course, there is a lot we have done in the field of forestry, education, gender equality but now as I have said is the time to look at the future, let us say, the upcoming sixteen years how will we see the world and how we can do things together. We have a very active Finnish embassy and community here.

It is interesting that you’ve mentioned Mr Ahtisaari who during the reign of the late Mwalimu Julius Nyerere served as Finnish ambassador here and worked closely with Tanzania’s first President when Mr Ahtisaari was UN Special Envoy for Namibia. And it is this for this reason that we would like you to talk about the role this interpersonal relation played in enhancing the diplomatic relations between the two countries.

Well, I’m a politician of second-generation where my father started off his career as a member of parliament during the 1980s. He also served as a minister in 1990s. So I had the honour when I was young to know Mr Ahtisaari as a Finnish president and of course it had been a great honour to follow on their excellent works.

But of course the work also here [in Tanzania] with their great friends and counterparts. I think they had such a vision – how they envisioned – the future and how to build a future in the areas of peace-making, gender equality, women’s rights, and of course, as a young minister I’m very happy that I have been able to get to know them in person and I try to learn from such great leaders. I think there is a lot we can learn from all the great leaders and I can learn more when I’m here in Tanzania.

I know that our people back in Finland really appreciate the great men and women in this country who have led the country and I’m very honoured to follow the suit in my role as a minister.

If we move now to the details of Finland-Tanzania relations, we are aware that your government pleaded to support Tanzania’s development agenda with Euro52million of funding between 2016 and 2019. Would you say how much of this money has been disbursed so far?

Well, as a minister of course, I am very proud that Finland is carrying and taking its global responsibilities which mean that our government led by Prime Minister Sanna Marin has provided more resources for development cooperation. And of course, I’m very proud that our country’s program has been very successful. We are now working on the implementation – it could have been faster as far as the timeline – but things are going further than we have to be patient in this world.

There are results, some good results, but also there are some challenges but all in all, the most important thing is that we have the strategic willingness of doing things and of course, the most important thing is that we, together with our Tanzanian friends and colleagues will do them.

We understand that one of the plans in the offing as far as Finland’s relations with Tanzania is concerned is to move from aid to trade, economic cooperation, research and culture. What would this shift mean in real terms and why you think it is important to move from aid to trade?

Well, if we look at the global situation, and the sustainable development goals and the Agenda 2030, and the ambitions that Finland is committed to, there are very good goals. But, unfortunately, if we look at the current situation in this world the goals are quite far away.

In other words, we need more and more resources for our development works in order to achieve sustainable development goals. Whether it is in area of education, healthcare, climate change challenges, and so forth. And having said that Finland plans to move from aid to trade type of concept, it means that we have seen we can provide leverages where we can support local communities and the nation at large through opportunities of trade.

Moving from aid to trade by 100 per cent means that we can be able to understand the opportunities in so-called blended finance. It’s a big question now in Europe. That we are looking for new ways to finance when it comes to development policy.

In order for us to achieve the goals we have set at the global level, we really have to look at the financing model. How are we going to have more leverages and effectiveness? Moving aid to trade is one way of doing that.

Good governance takes the second slot in terms of Finland’s areas of support in Tanzania with 39 per cent of the support going to improve governance. We are interested to hear from you if your country is happy with Tanzania’s good governance record?

Finland has supported a number of initiatives that seek to advance good governance in Tanzania and of course we pay attention to such initiatives. It means that we are emphasising on strengthening public financing management, first of all, we are working on modernising the tax system, development of the public sector’s leadership skills as well as increasing women’s roles in decision-making as well as human rights.

Many challenges do exist. But I think Finland as a country we have managed quite well to lead by our own example. I think that this the best way.

That we are showing examples that how we have worked on these particular issues and even we have our own challenges in Finland. There is progress [in Tanzania] but some challenges still remain.

As a follow up to that question, there has been a tendency by some of Tanzania’s development partners to withhold their development support to Tanzania in an effort to pressure the country to abide by international standards on human rights and good governance. This, however, has not been the case with Finland. Why is that?

Obviously, Finland always emphasises on the importance of the rule of law but it is also important to see that Tanzania itself continues to work towards these goals. And of course, we recognise the challenges. But we believe that by building up even further and deepening the dialogue between our governments and our people we can work and solve these challenges together. So the most important thing is to have the dialogue.

Tanzania is determined to build an industrial economy and achieve a middle-income aspiration by 2025. And we understand that Tanzania is the first development cooperation partner with Finland.

If we look at the Finnish history, Finland had very difficult years after the Second World War. Finland actually received development aid till the 1960s. But the question is why and how Finland managed to survive and prosper?

One of the key answer is that we invested in human capital, meaning education. I think that that was the most important decision Finland ever made.

And of course combining that with investment in social and health care, family planning and comprehensive education system, that everybody has the opportunity to access education from the very childhood to the high school level and university. It was a big decision made decades ago and I think it really paid back.

But obviously, if you look at the development of any society as a whole, I would like to raise one element which is very important too and that is taxation.

It is very important that the government, politicians, civil servants and the society as a whole understands the importance of taxation as a very critical instrument to make government earns income, both at the national level and the local levels.

Every country needs income in order to provide services. And of course even in Finland we have a very critical discussion even now about taxation.

But I think most of the Finns think it is good to pay taxes as citizens and as companies. And therefore, of course, we will definitely deepen our cooperation in the field of taxation especially on the technical assistance.