The Journey to a Trillion Dollar Economy: A Proposal for establishing Tanzania's Two Sovereign Wealth Funds - Part 7 By Youngsaviour Msuya Throughout this series, we have examined the economic theory behind rapid growth, studied the agricultural and infrastructure pillars Tanzania must strengthen, and drawn deep lessons from two of the world's most successful sovereign wealth funds: Norway's Government Pension Fund Global and Botswana's Pula Fund. The question that has been building across every article in this series can no longer be deferred: what must Tanzania actually do? Professor Sospeter Muhongo, speaking in parliament, gave us a clear and bold answer. He proposed the establishment of two dedicated Sovereign Wealth Funds for Tanzania: 1. Tanzania Natural Gas & Oil Sovereign Wealth Fund 2. Tanzania Minerals Wealth Fund Why Two Separate Funds? A reasonable question is: why two funds rather than one? In my view, the answer lies in the nature of the resources themselves. Natural gas and oil are liquid commodities traded on volatile global markets, with revenues that can fluctuate dramatically from one year to the next. Tanzania's natural gas reserves, particularly in the deep-sea fields off the coast of Mtwara and Lindi, represent a significant but time-sensitive opportunity. Minerals, on the other hand, encompass a far broader and more diverse category including gold, tanzanite, coal, nickel and iron ore. Each mineral has its own market dynamics, extraction timeline, and revenue profile. In my opinion, managing minerals revenue under a separate fund would allow for governance structures specifically tailored to the complexity and diversity of the sector. I also believe that keeping the two funds separate would promote greater accountability. It is far easier for parliament, civil society, and citizens to scrutinise two focused funds than one opaque mega-fund that mixes revenues from entirely different sources. But this is a matter I welcome others to weigh in on. The Timing Could Not Be More Critical Tanzania is at an inflection point. Negotiations and investments around liquefied natural gas (LNG) infrastructure are advancing. Mining revenues are growing. In my opinion, if Tanzania does not put the right institutional framework in place now, before the revenues peak, it risks repeating the mistakes of countries that consumed their resource wealth without building anything lasting. Norway established its fund in 1990, before its oil revenues reached their peak. Botswana established the Pula Fund in 1994, while diamonds were still abundant. Both countries acted early, and that early action is precisely why both funds are thriving today. The best moment to build the house is before the rain arrives, not during it. What is your opinion ? Should Tanzania establish wealth funds? Do you think Tanzania should establish two separate wealth funds or just a single wealth fund? ...to be continued...
