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CoST Launch Report

CoST Rules November 2008 

News Brief


Multi Stakeholder Groups (MSG) in Tanzania

How does CoST Work? 

Tanzania Construction industry

Since 2000, Tanzania's real GDP has grown at an annual rate of about 6.3 percent, with the construction industry a major contributor to this growth. Construction contributes around TSh 740 billion (£300 million) or about 5.6% to the GDP of TSh13, 000 billion or £5.2b. The Ministry of Infrastructure & Development is the main government body dealing with infrastructure together with the Prime Minister's Office for Regional and Local Government. Tanzania has a number of well developed regulatory and business/professional institutions operating in the construction sector. The main body tasked with developing the sector is the National Construction Council (see http://www.ncc.or.tz/) with the purpose of promoting the development of the local construction industry.

The construction industry is a sector of the economy that transforms various resources into constructed physical economic and social infrastructure necessary for socio-economic development. It embraces the process by which the said physical infrastructure are planned, designed, procured, constructed or produced, altered, repaired, maintained, and demolished. Thus, the construction industry is a fundamental economic activity which permeates most of the sectors of the economy and it has a major role to play in achieving social economic development objectives of any country; yet is consistently ranked as one of the most corrupt areas of economic activity in a number of countries including Tanzania.

The Government has been concerned about the problem; as a result has been taking a number of initiatives geared towards preventing and combating corrupt practices; notable amongst which include: Enactment of the Prevention and Combating of Corruption Act 2007, strengthening the Prevention and Combating of Corruption Bureau (PCCB), and financial and public procurement reforms (Public Procurement Act, 2004 and the Public Finance Act 2001)

Furthermore, in 2003, the Government published the Construction Industry Policy. One of the objectives of the Construction Industry Policy is to ensure efficient and cost effective performance of the construction industry that will guarantee value for money on constructed facilities in line with best practices. Such are an objective cannot be meaningfully achieved without combating corruption. Accordingly, it is the Government's resolve to; promote adherence to principles of corporate governance in the construction sector, and to promote measures for preventing corruption in the construction sector by measures that include enhancing efficiency, transparency and accountability in procurement, design and contract administration, and instituting mandatory technical auditing of all major public - financed projects where there shall be suspicion of malpractice.

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