Tanzania’s poverty level still high

A view of Dar es Salaam, which has a population of about 4 million people, is one of the fastest growing cities in Africa. 

Tanzania’s economy is agriculture-based and accounts for about 50 per cent of the GDP, which accounts for 80 per cent of the labour force and 80 per cent of the total export.

Major exports include coffee, sisal, tea, cashew nuts, just to name, but a few. Tourism ranks second after agriculture and also ranked second globally after Brazil in terms of attractions.

In 2000, Tanzania launched Vision 2025 aimed at quality livelihoods and competitive semi-industrialised economy capable of producing sustainable growth.

Tanzania’s economy is projected to grow at about 7 per cent in 2014/15 driven by transport, communication, manufacturing, infrastructure and agriculture compared to 5.9 per cent for Kenya and 6.6 per cent for Uganda within the same period, according to Mundi Index.

Poverty level and inflation

Despite remarkable efforts in agriculture a major source of earnings for the majority Tanzanians things are not exactly as intended.

The level of poverty remains high where one-third of the population is still poor marking a marginal drop in poverty from 35.7 per cent in 2001 to 33.6 per cent in 2007 and also recorded 1.3 million people succumbing to absolute poverty within the same period as per the Household Budget Survey in 2007.

Tanzania ranks 52th in the world with 36 per cent below the poverty line.

The same Household Budget Survey undertaken in 2013 shows that despite average growth of 7 per cent it has not translated into poverty reduction due to lack of inclusive policy for agriculture.

The national debt has accumulated to about Sh30 trillion proportional to 36 per cent of the GDP, ranking Tanzania 91st position globally.

The national debt has not reached undesirable state for investors to lose confidence in the government’s ability to foot or service it.

Inflation has been decreasing from year to year as it now stands at 5.9 per cent. This bold achievement has been due to improved food production and supply, prudent fiscal and monetary policies, continued stability in the world market oil prices and others.

Unemployment rate also has been decreasing as it recorded a decrease to 10.7 per cent in 2011 from 11.7 per cent in 2007 compared to unemployment rate of 40 per cent in Kenya in December 2010.

These two have adverse impacts on the economy and a decrease in one implies an increase the other.

Corruption undermines people’s effective participation and representation in society and makes day-to-day lives more painful for the people.

Tanzania can take a leaf from China

China had the same problems as Tanzania ranging from rapid rural-urban migration, unemployment, corruption and income gap. In 1966 Mao Zedong before his death in 1976 and his allies launched the Cultural Revolution, a movement that saw China go through economic reforms in 1980.

These reforms helped to lift hundreds of millions of people out of poverty, bring the poverty rate down to less than 9 per cent from 33 per cent of the population.

After 2006, China made a transition from a manufacturing economy to an innovation-based economy. There is no effort, which does not pay. Today, China is one of the developed economies and an emerging superpower power projected to take the lead by 2020.