Analysis of Review of the National Economy 1977-78
Hali ya Uchumi wa Taifa Katika Mwaka 1977-78 Government Printer Dar-es-Salaam 1978 shillings 15/-

Randal Sadleir

One short brutally honest paragraph in the opening chapter provides the key to the year under review; it reads

“In the period 1977/78 the East African Community which had begun to falter in 1976/77, died. During this time all the Community Corporations were broken up and the frontier between Tanzania and Kenya closed. Trade between the partner nations also greatly Declined.”

How greatly is shown by the fact that there was an 88.5% fall in exports
to Kenya and Uganda and a 73.5% fall in imports from those countries. The tourist trade was particularly hard hit with a decline in the overall number of visitors, and a 39.6% reduction in hotel bed occupancy rates – the Northern areas being most affected with only 11% of tourist hotel beds occupied. The cholera epidemic did not help. The communications and transport systems suffered most from the collapse of the Community which has left Lake Victoria with no ship, the Indian Ocean ports especially Dar-es-Salaam with a critical shortage of dock facilities unloading equipment and storage space, and the infant Tanzania Airways Corporation short of vital aircraft and spare parts.

However, the authors remain optimistic, pointing out that the state of the economy as a whole showed some improvement in that the National Income had increased by 5.9% as against 5.2% the previous year, whilst the food position had also improved although it had again been necessary to import over £11 million worth of grain (mainly rice, maize and wheat) and this accounted for 5.3% of the imports bill. High world prices of cotton, coffee and cashew nuts helped to swell the agricultural sector by 5.6%, (the rise had been 4.7% in the previous year) whilst other sectors of the economy to show increases included water and power, wholesale and retail trade and minerals. Low industrial output again caused concern and was as usual attributed to shortage of experts and raw materials, increased costs of building materials, power cuts, water shortages, and difficulties in identifying suitable overseas markets. The communications, transport storage and building sectors also proved disappointing. The 1976/77 improvement in the balance of payments was not maintained, a 10% increase in exports being offset by a 14.3% increase in imports, to leave the trade deficit widening again from £65 million to £83 million.

Inevitably inflation was still a problem with rising prices largely caused by increases in the cost of food, cigarettes, paraffin oil, transport and accommodation (the rent of a room increased from 30/- to 50/- per month in May 1977). The retail price index for middle income workers in Dar-es-Salaam increased by 20.6% in 1977, compared with 8.4% increase in 1976; the same index for lower paid workers in Dar-es-Salaam went up by 16.9% in 1977 as against 14% in 1976, whilst the index in Dodoma only went up by 7.3% in the year under review. The number of paid workers rose by 3.8% from 456,787 in 1976 to 474,090 in 1977, virtually restoring the position to the 1975 level of employment. At the same time the total wage bill rose by 20.4% compared to the 2.2% drop the previous year; this was largely caused by increased employment in the agricultural sector.

As usual the report is well furnished with 70 tables of statistics conveniently placed in relation to the subject material, from which a vast amount of information can be gleaned by the reader, ranging from the customary fiscal figures to interesting items such as the electricity consumption in Mafia, the 122 tons of mail carried by air in 1977 and the million passengers who travelled on the UHURU Railway during the same year. Its pages well illustrate the tremendous struggle facing a new nation swimming against the economic tides, but buoyed up with a fierce determination to stick to her political principles at all costs.