Mwananchi Engineering and Construction Company (mecco)®

MECCO is Tanzania's nationalised building and construction
company. The management agreement was between N.D.C. and a
Dutch company, Overseas Construction Company (0.C.C.), a
member of the Nederhorst group of companies. It was signed in
February 1967. O.C.C. purchased 40% of the equity of the com-
pany for two million shillings. Under the terms of the agreement
they were to receive 40% of the profits (or T shs. 100,000/ per
year if that came to more) and in addition a management fee equal
to 1% of the turnover of the company.

The firm was not a new one. From 1963 the Mwananchi
Development Corporation (the economic arm of the National
Union of Tanganyika Workers) held a minority share in a building
company started and run by Mr. Tara Singh Dogra who has been
in the building business in Tanzania since the 1920’s. In 1966 the
share of the Mwananchi Development Corporation was tran-
sferred to N.D.C. and shortly afterwards N.D.C. purchased Mr.
Singh’s share as well. The assets and goodwill of the existing com-
pany were thus available to make up part of the Government’s
60% share in the new company, MECCO.

The objective in bringing in outside management was to allow
an increase in the scale of the company so that it could compete
for complex building and engineering contracts, which hitherto
had been taken by foreign building contractors. If these constracts
were handled by a local firm there would be considerable savings
in foreign exchange, and it was thought that these big contracts
were full of ‘fat’, so that MECCO would be a profitable in-
vestment.

The agreement provided that the MECCO management would
undertake to train skilled craftsmen and technicians at all levels of
industry, and would draw up a plan for a technical institute to be
established within the organisation of MECCO. It also included
routine clauses that MECCO would set up financial control
systems on its building sites, and keep its accounts up to date so
that its financial state could be inspected at any time. Expatriate
staff who were recruited were to be paid the same salaries by
MECCO that they would have received if they had been em-
ployed by O.C.C.

Two and a half years later (November 1969) neither a training
programme nor a technical institute had been established. The

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