Staff
Writers, Kampala and Dar es Salaam
In
what may be called “the penetration of
Magufulification effects in Uganda”, President John Magufuli of Tanzania
has asked his Ugandan counterpart President Yoweli Museveni to dissolve the
Uganda Revenue Authority (URA) leadership for delaying the Hoima-Tanga Oil
pipeline over tax issues.
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| In Tanzania Museveni witnessed the inaugaration of Nyerere Building and held formal talks with Magufuli |
President Magufuli has in the period of three years in
power changed five times the leadership of Tanzania Revenue Authority (TRA) to
make the country do business fairly locally and internationally.
Speaking in Dar es Salaam this week during the
Uganda-Tanzania Business Forum organised by the business community from the two
countries with the aim of boosting bilateral trade, President Magufuli urged
Museveni to ensure his tax man sacrifices some short-term tax benefits with long-term
projections.
“Sacrifice some of the short term gains for the long term benefits
and your URA officials should not delay you, actually we wanted this pipeline
to be named Kaguta Pipeline when it opens, “said Magufuli amid laughter’s from
Museven himself.
The Magufuli’s call came after French giant Total E&P,
the lead developer on the East African Crude Pipeline (EACOP), last week
announced all activities down and upstream the project would be stopped
following the withdrawal from the partnership of another partner, Tullow Oil.
The firm cited “uncertain business” environment in Uganda following
a collapse of a deal for Tullow Oil Company to sell its stakes to Total and
China National Offshore Oil Company (CNOOC), technically referred to us as
farm- down, due to unresolved tax issues.
Reacting to President Magufuli’s call, President Museveni
said Uganda will not be the cause and obstacle of the implementation of the
project. He assured President Magufuli that all measures will be taken to
ensure the project is resuming as arranged.
“I agree we need to do things faster and I can assure you
this project will not stop. The problem in Uganda you can survive even if you
are not bright unlike in other countries,” joked Museveni.
What measures will be taken by President Museveni after
President Magufuli’s call to dissolve the URA is the matter of time,
stakeholders are now waiting to see what steps will be taken in the near
future.
The 1,445km East African crude oil export (EACOP) pipeline is being
constructed between Kabaale in the Hoima District of Uganda and Chongoleani in
Tanga, Tanzania. On completion, it will become the world’s longest heated crude
oil export pipelines.
The Governments of Uganda and Tanzania signed a $3.5bn
inter-governmental agreement in May 2017 for the development, which is expected
to have an export flow rate of 216,000 barrels a day.
CNOOC, Total, and Tullow Uganda have formed a joint venture (JV) to
develop the pipeline in
conjunction with the two governments. A foundation stone-laying ceremony for
the project was held at Chongoleani in August 2017 and at Hoima in November
2017.
First oil was expected by the end of 2020 and the project is
expected to create over 10,000 jobs during construction.
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