Locals have been urged to invest more in Tanzania as the country launches the Mkoba Private Equity Fund – the first ever private equity fund in the country.

The $300 million (about Sh480 billion) Private Equity Fund aims to fill the gap in the private equity market in Africa by providing growth capital to portfolio companies not on the radar of most funds.

In Tanzania and other parts of Africa where it focus on (Ethiopia, Tanzania, Rwanda, Mozambique, DRC, South Africa, Cote d’Ivoire, Liberia and Sierra Leone), the fund will support SMEs targeting equity investments ranging from $1.0 to $15 million (about Sh1.6 billion to Sh24 billion).

Speaking at the launching of the fund yesterday, President Jakaya Kikwete said the launching of the fund is of significant importance as it will “provide growth capital for high-growth small and medium sized companies.”

He noted that investor’s confidence continue to grow in the country as Foreign Direct Investments (FDI) rose by 38 percent at a point when FDI flows had reduced globally.

However, while the president pointed out the opportunity for the private sector to work with the government in transforming the country’s economy, CEO for Infotech, Ali Mfuruki said the government was yet to take the private sector seriously as its prime development partner.

“We need to start talking … Tanzania will be built by Tanzanians and not foreigners,” he said.

Tanzania Private Sector Foundation (TPSF) Chairman Dr Reginald Mengi also challenged SME owners and upcoming businesspersons to take risk in investing in the country.

“In business we take risks but not of investing in other countries … I will only continue to invest in my country,” he said.

Economists and business leaders have said Tanzania has all it takes to become the continent’s economic powerhouse if it maintains political and economic order.