GUIDELINES TO INVESTORS

GUIDELINES TO INVESTOR

ZIPA is operating under 2004 Investment Act.   Its main objective is to promote and facilitate investments and trade in Zanzibar.  The act highest priority is to strengthen the Balance of Payment through encouraging Private Investments.

Zanzibar is a fast growing economy, liberalized, politically and economically stable with ample skilled and trainable work force.  Zanzibar prides itself to be an important transit point, which could serve the huge market of more than 300 million inhabitants of East, Central and South Africa Region.  It is also a Gateway to the Gulf, Far East and beyond.

OBJECTIVES

When the Zanzibar Government embarked upon an economic policy which strives to attract foreign and domestic investments, the main objectives of the policy were: 

i)                    To offer more employment opportunities to Zanzibaris.

ii)                   To improve balance of payments especially through encouraging production for export to earn foreign exchange.

iii)                 To enable transfer of technology.

iv)               To exploit and to develop natural resources and

v)                 To develop human resources.

ONE STOP CENTRE

ZIPA is a one stop centre for investors.  We identify investment opportunities; secure work and resident permits, tax exemptions and advice on investment protection under the Act.

INVESTMENT OPPORTUNITIES

The following are sectors and areas, which are open for private investment:

1.1       AGRICULTURE:         

§         Horticulture & Floriculture

§         Agro processing 

§         Fruit processing and canning

1.2       LIVESTOCK AND ANIMAL HUSBANDRY:

§   Dairy farming

2.0       FISHERIES:

§                     Deep sea fishing

§                     Fish farming

§                     Processing and canning

3.0       TOURISM:

·         Up market hotels/resorts especially chain hotels.

·         Tourism supporting services such as first class restaurants, exhibition and conference centres, diving & sea sports.

·         Tour operator (with exception of ground handling).

4.0       INDUSTRIES:

·         Manufacturing

·         Processing

·         Assembling plant

·         Construction and maintenance

5.0       SERVICES:

·         Health

·         Education

·         Business and Financial services

·         Information and Communication Technology

  AREAS RESTRICTED TO FOREIGN INVESTORS

  Barbershops, Hair dressing, Beauty saloons, Retail shops and Casinos

6.0       OTHER OPPORTUNITIES:

6.1       Export Process zone

§         Manufacturing for export

§         Processing for Export

§         Zone development

6.2       Free Port

·         Transit trade

·         Warehousing

·         Packing

INCENTIVES

The Investment law offers a lucrative package of incentives including:

Source: ZIPA, 2005

EXEMPTION OF IMPORTED CAPITAL GOODS

ZIPA issues letter of exemption for imported capital goods.  A clearing agent should   complete the normal Customs Declaration Form clearly and accurately showing the appropriate tariff code.  Attached copies of shipping documents including packing list, bill of lading, airway bill, copies of commercial invoices and copy of Customs Entry Form.

Documents should be submitted to ZIPA for clearance and payment of service charge of 5% on applicable duties.

FACILITIES

Issuance of work and resident permits:

ZIPA acquires work and resident permit for investors/expatriate after submitting the following:-

              I.      10 passport size photographs for Investor/Expatriate

              II.      3 copies of C.V.

           III.      3 sets of photocopies of passport

         IV.      3 copies of police clearance from the country of origin

           V.      3 copies of employment contract and job description for Expatriates

         VI.      Income tax clearance

          VII.      3 sets of academic Certificates for expatriates

Fees for work permit (in US$):

                                                PERIOD           INVESTOR                   EXPATRIATE

Application                           One year       50                                150

Renewal                                One year       25                                75

Temporary (6 months)          six months      -                                  100

Fees for resident permit (in US $):

                        PERIOD           CLASS A         CLASS B                     DEPENDENT

Application   Two years      1,620.00          620.00                        120.00

Renewal                    -             820.00           320.00                         70.00

Temporary     six months           -                  300.00                 -

N.B.:    Illegal Employment is an offense and is subjected to penalty.  Late renewal of work/resident permits is subjected to penalty.

Acquisition of Land:

Land is a Government owned, it can only be acquired by lease through Department of Lands and Survey (DLS).  However, signing lease agreement with DLS is subjected to approval of project by ZIPA.

INDICATIVE LAND RATES

Investors are strongly advised to refrain from entering private agreements on land acquisition/lease.  The Government does not recognize such transactions however attested they are. Only DLS is legally responsible for administering land lease prior approval by ZIPA.

INFRASTRUCTURE

The cost of electricity in US$ per  Kwh

Source: ZPCF, 2005

Availability of Water:

Plenty of water is available in Zanzibar.  Rates are US $ 1 per cubic meter.

Communication Facilities:

There are five main telecommunication companies, which connect Zanzibar to the world.  TTCL, TIGO, CELTEL, VODACOM and ZANTEL. Rates for International calls are reasonable.

Work Force:

There is ample skilled work and trainable force to serve investment projects.  English is understood and can be spoken by many Zanzibaris.  Wages are comparatively low.

  APPLICATION PROCEDURES

1.   Proposed project should meet the minimum capital requirement for a particular sector to be approved. These are:    

  Source: ZIPA, 2005

2.   Investors are required to complete the official application form, which is available from the above office during office hours for a fee of US $ 200 or its equivalent in Tshs.

3.   The application form should be submitted with a supporting detailed Feasibility Study (which must be copied ten times) to the above address.

The main body of the Feasibility Study should cover:

                I.      The first 5 years of the project cycle.

                II.      Financial analysis of expected costs and revenue including breakdowns for each year.

               III.      A full and comprehensive list of expected imports together with their cost estimates.