Why Tanzania is turning to global SOE success stories

DAR ES SALAAM: WHEN Chinese Ambassador to Tanzania Chen Mingjian visited the Office of the Treasury Registrar (OTR) this week, the discussions reflected more than growing diplomatic ties between Tanzania and China.

They also highlighted a wider and increasingly important question facing many economies seeking to accelerate industrialisation and improve returns from public investments.

For Tanzania, which is currently implementing reforms aimed at improving the performance of public institutions and maximising returns from government investments, the answer may lie in studying countries that have successfully transformed their state-owned enterprises into drivers of economic growth.

China is one of those countries

During the meeting with the OTR management led by Treasury Registrar Nehemiah Mchechu, Tanzania expressed interest in learning from China’s State-owned Assets Supervision and Administration Commission of the State Council (SASAC), an institution credited with overseeing one of the world’s largest and most ambitious state-owned enterprises (SOEs) reform programmes.

But China is not alone in successfully transforming stateowned enterprises into strategic economic assets.

Countries including Singapore, Norway, the United Arab Emirates, Malaysia, and South Korea have shown that with strong governance, professional management, and clear accountability systems, public enterprises can evolve into globally competitive institutions that support industrialisation, infrastructure expansion, job creation, and long-term economic transformation.

Currently, the OTR oversees 308 institutions and companies in which the government has investments, including 252 entities where the State holds majority shares, with total investments valued at 92.3/- trillion.

These investments span strategic sectors such as aviation, transport, energy, oil and gas, mining, infrastructure, banking, real estate and telecommunications.

In recent years, Tanzania has intensified reforms aimed at reducing dependence on government subsidies, increasing dividend contributions to the Government Consolidated Fund, strengthening institutional accountability, and granting greater operational autonomy to public entities.

According to Mr Mchechu, the reforms are intended to ensure that public institutions contribute meaningfully to national development while operating efficiently and sustainably.

“Even if we want the economy to be driven by the private sector, an inefficient public sector will continue to be an obstacle to private sector growth,” he said during the meeting.

His remarks reflect a broader policy shift in Tanzania — one that increasingly views SOEs not merely as service-delivery institutions, but as strategic national assets capable of driving industrialisation, attracting investment, and supporting long-term economic growth.

Why the global SOE models matter

China’s SOE reforms are widely regarded as one of the most successful examples of public sector transformation in modern economic history. Before the reforms of the late 1970s, many Chinese stateowned enterprises were heavily bureaucratic, inefficient, and financially dependent on the state.

However, under the Reform and Opening-up policy introduced in 1978, China gradually transformed its SOEs through market-oriented reforms, stronger governance systems, commercial discipline, and improved oversight mechanisms.

The establishment of SASAC in 2003 became a turning point. The institution was tasked with acting as the government’s shareholder representative while ensuring state firms improved profitability, competitiveness, and operational efficiency.

Today, many Chinese stateowned companies rank among the world’s largest corporations in sectors such as energy, infrastructure, telecommunications, transport and manufacturing.

Singapore offers another widely admired example through Temasek Holdings, a state-owned investment company established in 1974 that operates on commercial principles with a global portfolio spanning financial services, telecommunications, media, technology, transportation, life sciences and agri-food.

Through professional management, operational independence, and strong governance systems, Singapore has successfully built globally competitive companies in sectors such as aviation, banking, logistics, and telecommunications.

A notable example is Singapore Airlines, which is consistently ranked among the world’s leading airlines despite its links to state investment structures.

Elsewhere in Asia, Malaysia and South Korea have used strategic state-linked investments to accelerate industrialisation and strengthen domestic industries.

Khazanah Nasional, Malaysia’s sovereign wealth fund and strategic investment arm established in 1993 to manage the government’s commercial assets and support long-term national economic development, has played a significant role in sectors such as infrastructure, aviation, and telecommunications.

Similarly, South Korea has relied heavily on strategic industrial coordination to develop globally competitive industries in manufacturing, shipbuilding, steel, and technology.

Beyond Asia, Norway has demonstrated how governments can retain ownership in strategic sectors while upholding strong accountability and commercial discipline.

Through companies such as Equinor and the management of the Government Pension Fund Global, the country has built a model that combines state ownership with transparency, efficiency, and long-term wealth preservation.

In the Middle East, the United Arab Emirates has similarly used state-linked enterprises to diversify its economy beyond oil dependence.

Companies such as Emirates and DP World have become internationally recognised brands and major contributors to infrastructure expansion and global trade.

For Tanzania, these international examples provide important lessons on how stateowned enterprises can become commercially viable while supporting broader national development objectives.

Tanzania’s strategic direction

Analysts say Tanzania’s growing interest in global SOE reform models reflects recognition that public investment management will play an increasingly important role in achieving long-term national development ambitions, including Dira 2050.

ALSO READ: OTR reviews public institutions’ plans to align with Vision 2050

The country’s broader economic agenda includes industrialisation, infrastructure expansion, mineral value addition, strategic partnerships, and stronger public-private sector collaboration.

Mr Mchechu noted that the OTR is a strategic institution mandated to oversee government investments, underscoring the importance of close cooperation with successful countries, particularly in areas related to public enterprise management, strategic investments and the implementation of major development projects.

“As we reform our institutions, we want to learn from countries that have successfully walked this path. China remains one of the best examples globally in transforming stateowned enterprises,” he underscored.

This week’s discussions between Tanzania and China also touched on cooperation in maritime transport, mining, port operations, and strategic investments, as well as plans to strengthen local mineral processing and value-addition industries.

The two sides also exchanged views on the future of the Tanzania-Zambia Railway Authority (TAZARA), a historic symbol of Tanzania-China cooperation that marks 50 years of commercial operations this year.

Ambassador Mingjian reaffirmed China’s readiness to continue sharing institutional reform experience with Tanzania while supporting cooperation in infrastructure development, technology transfer, governance, digital transformation, and public sector training.

The Chinese government has already been supporting capacity-building efforts within the OTR, with several officials benefiting from specialised training programmes in China over the past two years.

For many economists, the key lesson from successful SOE models around the world is that ownership alone does not determine success or failure.

Rather, success depends on governance quality, strategic leadership, accountability systems, operational independence, and the ability of institutions to balance commercial performance with national development priorities.

As Tanzania continues reforming its public investment ecosystem, the country appears increasingly focused on ensuring that SOEs become not only instruments of public service delivery, but also engines of economic transformation, industrial growth, and national competitiveness.

The post Why Tanzania is turning to global SOE success stories first appeared on Daily News.

The post Why Tanzania is turning to global SOE success stories appeared first on Daily News.