Can CEOs drive inclusive industrialization?
Just ask your Tanzanian counterparts.
Nearly two-thirds of Tanzania consumes imported palm oil, despite the fact that the country has more than 1 million sunflower farmers who produce a substitute product. Sunflower oil has 80 percent less saturated fat content than palm oil and it is recognized by Tanzanian consumers as healthier oil. However, domestic sunflower oil is expensive. It retails at almost twice the cost of imported palm oil. CEOs have naturally responded by developing palm oil importing and refining operations that import cheap crude oil from Southeast Asia, refine it locally, and distribute it across the country. That’s industrialization, right?
Well yes, but it doesn’t create many jobs in Tanzania. A majority of Tanzanians work in the agriculture sector, but most of them do not benefit from the palm oil industry. Tanzanian farmers cannot produce for export because their oil is not as competitive as oil coming from Ukraine or Argentina. They can produce for domestic markets, but consumers cannot afford their products.