May 9, 2003

Reforms did not yet result in economic growth

Acting in response to urgings of the IMF, the World Bank and other international donor agencies, the Government of Tanzania has been implementing spectacular economic policy and institutional reforms since 1986.

Beginning in the early 1990s, the Government has been privatising what were once public companies, retrenchment of government employees, elimination of subsidies to the still unprivatised public companies and agriculture. It has also introduced new taxes and cost-sharing in education and health, has devalued the currency, reduced public expenditure, liberalised trade and has been paying back debts. The IMF and World Bank conditionalities attached to structural adjustment policies to the developing countries have had the aim of reducing inflation, increasing the rate of growth of output and exports, as well as increasing productivity and efficiency.

However, developing countries have often been subjected to harsh conditions even when such adjustments are not important to national development. 'As the mechanisms used have not actually addressed people, but have rather addressed processes such as the devaluation of currency, reduction of public expenditure, cost-sharing in health and education, elimination of subsidies in agriculture sector, privatisation and so on, the result of such policies is that they have lowered the living standards and impaired health and welfare of majority Tanzanians, especially rural communities.' This is the view expressed in a report by the Tanzania Gender Network Programme 1996.

Since the implementation of IBRD and IMF recommendations, reliable data on income and consumption is lacking in Tanzania. So, it is necessary to turn to evaluation of more specific indicators of well-being.

Survey data by Colnell's analysis on adjustment and the poor in Tanzania show that, 'under-five' malnutrition and maternal mortality increased over the 1985-1993 period. Life expectancy fell from 54 years in 1987 to 52 in 1993 - and is now estimated to be 38 years. This is largely because of AIDS, unsafe water and the cost sharing policy in health. Per capita calorie consumption as a percentage of industrialised countries dropped from 69 in 1965 to 50 in 1995. This was largely due to the elimination of subsidies in the agriculture sector and other supportive policies. Paul Bjerk, an American associate professor researching on the effect of the Ujamaa villagisation programme in Tanzania, said the agriculture sector is not given the special attention it deserves. This is in spite of being the only economic activity and way of life for 80 per cent of the Tanzanian population.

Education indicators also deteriorated markedly. Primary school enrolment that had reached almost 100 per cent in the 1970s fell below 70 per cent in 1991; and below 50 per cent in 1999. Government officials argue that this trend is recovering as a result of the current policy of making free education for primary school enrollment. "Our economic situation prior to IMF adjustments was more tenable; and it is not true that it could worsen indeed this conclusion is more valid," said Professor Seth Nyagava, a professor in development economics. (Business Times, Dar es Salaam)


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