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R. S. Muhongo
natural resources, sharing of benefits and the costs of having a supranational regulatory body over domestic resources.
27 But a regional content
policy also advocates for pooling of resources and the facilitation of
having an independent regulatory body that is not captured by the politics of a particular country. Though regional content policies are yet to
be implemented, they may be the answer to questions that arise due
to the incremental costs of both national and community content policies, the lack of specialized skills and capital in resource-rich countries.
A regional content policy creates channels of pooling resources to attain
mutual benefits from the extractive industry.
10.3 Factors Affecting Local Content Design
in East Africa
Kenya, Uganda and Tanzania have in the last decade experienced the
Gold Rush that South Africa experienced in the twentieth century. This
is due to the extractive resources that have been found in these countries. Kenya discovered 700 million barrels of oil in Turkana, Uganda
discovered over 4.5 Billion barrels of crude oil in the Albertine region
and Tanzania discovered over 47 trillion cubic feet worth of gas in
Mtwara, the Southern region of Tanzania. Due to these resources, East
Africa adopted local content policies; the policy was adopted based
on different rationales. In Kenya, the local content policy emphasizes
domestic ownership, while in Uganda the local content policy emphasized domestic supplier integration into the oil and gas industry and
in Tanzania, the government emphasized on training the domestic and
host community as part of local content development. As much as, these
objectives are fundamental to the development of local content policies,
different factors affect the design of local content policies depending on
the nature of the prevailing circumstances of the economy. These are the
following:
27 Nwapi, Chilenye. “A survey of the literature on local content policies in the oil and gas
industry in East Africa.” SPP Research Paper 9/16 (2016).
R. S. Muhongo
natural resources, sharing of benefits and the costs of having a supranational regulatory body over domestic resources.
27 But a regional content
policy also advocates for pooling of resources and the facilitation of
having an independent regulatory body that is not captured by the politics of a particular country. Though regional content policies are yet to
be implemented, they may be the answer to questions that arise due
to the incremental costs of both national and community content policies, the lack of specialized skills and capital in resource-rich countries.
A regional content policy creates channels of pooling resources to attain
mutual benefits from the extractive industry.
10.3 Factors Affecting Local Content Design
in East Africa
Kenya, Uganda and Tanzania have in the last decade experienced the
Gold Rush that South Africa experienced in the twentieth century. This
is due to the extractive resources that have been found in these countries. Kenya discovered 700 million barrels of oil in Turkana, Uganda
discovered over 4.5 Billion barrels of crude oil in the Albertine region
and Tanzania discovered over 47 trillion cubic feet worth of gas in
Mtwara, the Southern region of Tanzania. Due to these resources, East
Africa adopted local content policies; the policy was adopted based
on different rationales. In Kenya, the local content policy emphasizes
domestic ownership, while in Uganda the local content policy emphasized domestic supplier integration into the oil and gas industry and
in Tanzania, the government emphasized on training the domestic and
host community as part of local content development. As much as, these
objectives are fundamental to the development of local content policies,
different factors affect the design of local content policies depending on
the nature of the prevailing circumstances of the economy. These are the
following:
27 Nwapi, Chilenye. “A survey of the literature on local content policies in the oil and gas
industry in East Africa.” SPP Research Paper 9/16 (2016).