Biofuels Investments in Tanzania

Abstract

After substantial global investments into biofuel production from 2005 to 2008, challenges to a sustainable and robust biofuel industry have become more apparent than many proponents have anticipated. Across country and development contexts, conflicts arose as plans to scale up production clashed with local preferences or national policies, and Southern Africa has been no exception. This article analyzes recent difficulties with biofuels projects in Tanzania before the background of the more successful experiences of Brazil and South Africa. We identify areas of incompatibility between local expectations, government policy, and investor incentives. An assessment of different biofuels business models shows that some-such as contract farmingmay not be appropriate for Tanzania's situation and that policies are necessary that can address the needs of both local and regional stakeholders and provide adequate incentives for investors to pursue sustainable biofuels production.

"Investors are good, if they follow the rules" – power relations and local perceptions in the case of two European forestry companies in Tanzania

“…There are hints about a slow down of foreign investments in some areas, e.g. in the biofuel sector of Tanzania (Hultman et al, 2012). A tendency away from land deals towards integration of smallholders in the global economy by contract-farming arrangements -as seems to be the case in Tanzania -is one scenario (Hall, 2011).…”

“…National government officials (interviewed by Locher, 2010Locher, , 2011 argued that the rural areas in Tanzania could benefit from such investments in terms of labour opportunities, improved agricultural technologies and infrastructure. However, due to numerous land disputes, public pressure and deflating experiences with failing projects, in 2010 the government published guidelines which regulate and limit biofuel projects, and reportedly is in the process of establishing ceilings which would limit the size of future land deals for any agricultural purpose (Hultman et al, 2012;Kiishweko, 2012).…”

Sustainable biofuel: A question of scale and aims

“…For example, territory -at each spatial scale -can be analysed to serve an objective such as the identification or evaluation of agricultural residue, residual biomass and/or other products for bioenergy production (Beccali et al, 2008;FerreiraLeitao, 2010;Goltsev et al, 2010;Mabee and Mirck, 2011;Tricase and Lombardi, 2009;Yan, 2008). Policies for biofuel development (Borras et al, 2011;Hultman et al, 2012) in rural areas are analysed to verify opportunities, through the development of biomass, to diversify economies and increase farmers' incomes (Mwakaje, 2012;Zolin, 2011). On the other hand, some recent studies question the scale of production (Carrosio, 2013;Cotula, 2012;Monteleone et al, 2009) and pay more attention to the local acceptance of biogas plants (Kortsch et al, 2015;Schumacher and Schultmann, 2017;Soland et al, 2013).…”

Social Dynamics of Renewable Energy—How the European Union’s Renewable Energy Directive Triggers Land Pressure in Tanzania

“…While the Tanzanian Investment Centre claimed that liquid biofuel development was technically feasible due to the availability of arable land, problems arose as developers, supported by foreign direct investments aimed at establishing liquid biofuel production, appropriated large amounts of land (Sulle & Nelson, 2009). The succeeding step-by-step processes from investment to ongoing (or cancelled) project revealed weak institutional arrangements that did not ensure farmers' rights-thus showcasing problems of a limited understanding of legal rights, various information challenges, and limited food security and environmental protection (Habib-Mintz, 2010;Hultman et al, 2012). After much media attention and civil society protests, the government issued a moratorium in 2009 that stopped further biofuel investments until the government had finalized its policy on biofuels (Sulle & Nelson, 2009).…”

“…Cle´menc¸on, 2016). Subsequently, Tanzania was chosen since it may be considered one of the most politically stable nations in sub-Saharan Africa (Coulson, 2013), and because of its many land-based investment targeting liquid biofuel production (Locher & Sulle, 2014;Sulle & Nelson, 2009) which also received a lot of attention in academic literature (e.g., Coulson, 2013;Habib-Mintz, 2010;Hultman, Sulle, Ramig, & Sykora-Bodie, 2012;Locher & Sulle, 2014;Matondi et al, 2011;Mohammed, Fraser, & Sawe, 2011;Romijn, Heijnen, & Arora, 2012;van Eijck et al, 2014).…”