Analysis of REVIEW OF THE NATIONAL ECONOMY, 1975-1976 (Hali ya Uchumi wa Taifa katika Mwaka 1975-76) published by the Government Printer, Dar es Salaam, 117 pages, price 25sh.

The first thing which I noticed about the latest Review of the National Economy was that its price had increased by 25%, eloquent testimony to the still prevalent rate of inflation, which at 14.9% increase showed a decline from the 17.4% of the previous year. The opening sentence reminds us poignantly of stark African realities when it states that ‘the fear of famine lessened as a result of the fruits of the Do or Die Cultivation Campaign.’ Nonetheless, the National Income for 1975 increased by 4.6% – more them double the rate for 1974 largely owing to the greatly increased output of food crops. Output from other key sectors remained either at the 1974 level or slightly less.

Industrial output, for example, again decreased, with only pyrethrum dust insecticide showing and improvement because of increased acreage under cultivation. Reasons listed for the decline include shortage of raw materials, spares and essential equipment partly owing to higher prices, partly due to shortage of foreign exchange; lack of adequate capital investment; occasional shortages of water and electricity in Dar es Salaam, Tanga, Arusha and Mwanza, affecting breweries, cigarette and textile factories amongst others; scarcity of technical expertise in dealing with production schedules, and inability to follow up problems and put then right. Also, two somewhat bizarre reasons – ‘Lack of success in certain factories for various reasons,’ and ‘other technical and leadership problems in Fibre Board E.A factories in Arusha and in the Uvinza Salt Mines’: prob1eLls too peculiar to contemplate!

The output of minerals continued to decline by 14.3% as against a drop of 4.79% in 1974 largely due to a decrease in the mining of diamonds and gem stones. However one rejoices to read that gold is confidently expected to be produced again this year on the Lupa.

The building programme now concentrating on the new capital at Dodoma and improvements to Dar es Salaam harbour following the completion of the Uhuru railway, delayed by a serious cement shortage caused by the failure of the local cement industry, with an output of only 310,000 tons to match the current demand of 700,000 tons per annum. Present extensions to the Portland Cement factory at Wazo Hill near Dar es Salaam should help to improve the position.

The balance of payments continues to pose problems. In 1975 exports decreased by 3.4% from £143 million in 1974 to £138 million in 1975, while imports increased by 8.3% from £269 million to £284 million mainly composed of machinery and equipment, a largo proportion of which comprised the rolling stock for the new railway. Thus the trade gap widened from a deficit of £126 million in 1974 to £146 million in 1975, while foreign currency reserves dwindled by over another £1 million, insignificant compared to the catastrophic drop of £30 million the previous year.

Parastatals again increased their combined surpluses, this time by 20%. Unfortunately figures for the number of tourists visiting Tanzania in 1975 were not available for the first time for many years, although somewhat mysteriously tourist bed-units in hotels, which are given, increased by almost 20% from 493,000 to 592,000, so it looks as if all records were again broken in this vitally important invisible export industry. It would be interesting to know how many visitors came from Britain but the breakdown in the excellent statistical tables only extends to Europe.

Britain again led the foreign trade tables with imports from Britain up by over 30% from £30 millions to £39 millions; although exports to Britain decreased by 16% from £21 million to £17 million she was still able to maintain her lead over any single country. Imports from China were down 7% following the completion of the railway. At home prices continued to go up but nothing like to the same extent as in 1974 – an overall rise of 7.2% compared to 40.5% But to the low income group of workers in Dar es Salaam this hit harder than to any other section of the community.

An encouraging advance in the Social Services showed medical priorities being given to village health services and preventive medicine, whilst the new Bagamoyo hospital was opened in July 1976. 50% of 106 new dispensaries were finished during the year, the KEKO pharmaceutical plant completed and drug trials started.

The educational effort is trying to meet the exciting target of getting every child of the right age a Primary school place by November 1977 and succeeded in increasing the number of pupils in Primary school by 232,411 children, a 50% increase, as a result of unspecified ‘urgent and revolutionary methods’ [see also later article].

The same methods doubtless contributed to the fact that by May 1976 some 12 million people, some 85% of the population, lived in 8,000 planned villages an increase of some 30% over the previous year.

While the authors may make the modest disclaimer that ‘the progress of our economy during 1975 was on the whole disappointing’, this fascinating document vividly reveals how Tanzania has brilliantly succeeded in turning economic factors to her own social and political ends.

Randal Sadleir

Economic Review for the Year 1974-5 (Hali Ya Uchumi wa Taifa katika mwaka 1974-5) Government Printer, Dar es Salaam, price 20/-, 109 pp.

Internally the past year has been one of crucial importance to Tanzania. We print here a review by Mr. T.R. Sadleir of the annual government report on the economy:

‘This concise, clearly presented and well documented report, vividly illustrates the struggles of a developing country caught up in the current economic typhoon. Nor do its editors make any attempt to gloss over the harsh realities of a difficult situation, made worse by widespread failure of the rains (in 1974) leading to serious food shortages.

An admirable short summary in Part I enables the layman to appreciate both the extent of the problems posed by the twin blows of world inflation abroad and crop failure at home, and the countermeasures introduced so swiftly by the government to meet them. Thus we read that the poor harvests brought in their train the added difficulties of using up precious foreign exchange reserves for food imports, while the foreign exchange earnings themselves were depleted by reduced exports of cash crops, with the resultant foreign currency drain precluding the purchase of adequate new materials and machinery for industry and thus increasing production costs.

World wide inflation high-lighted by the doubling of the price of petrol together with the instability of major international currencies, reduced the amount of goods purchased overseas. Indeed the local rate of inflation reached 17.9% with the result that the national income only increased by 2.2%, the lowest growth rate so far in any year of the second Five Year Development Plan. Since population growth is estimated at 2.7% per annum, average output per head has also declined.

Although most of the main food crops, especially maize, rice and wheat were hard hit, (as were coffee, sisal and pyrethrum) cotton, tea, tobacco and cashew nuts actually yielded increased crops. The serious food shortages led to the launching at the beginning of 1975 of a national “Do or die cultivation campaign” (Kilimo chakufa na kupona) which required every able-bodied citizen, as well as government departments, parastatals and commercial companies to cultivate food. Initial results of this drive are said to be encouraging. (See below). The report points out that great strides were made in village development and that ‘more than half the population now live in planned villages’.

The balance of payments position also worsened during 1974. Although exports rose in value by 10.8% to a total of £143 million, imports rose by 54.3% to reach a total value of nearly £269 million – a deficit of £126 million compared to £45 million in 1973, largely because of the sudden increase in expensive food imports, the increased price of petrol and world wide inflation. Members of the Society will be interested to hear that imports from Britain were up by 20.8% to a record £30 million and that Britain still takes a larger share of Tanzania’s exports, £21 million, than any other single country, heading both import and export tables as Tanzania’s principal trading partner for the past 12 years. During the same period wages rose by 15.4%, being wisely perhaps kept 2.5% below the rate of inflation. Capital growth not surprisingly remained static.

Amidst the array of statistics human facts emerge. ‘Many health schemes unfinished because of a shortage of both builders and building materials; industry faced with shortages of raw materials; water, electricity, transport services, low standards of efficiency and high cost of spare parts; building projects delayed by shortage of experts and rising prices; electricity and water schemes behind schedule’ and so on.

More hopefully, educational expansion continued to make rapid progress. Parastatals increased their combined surpluses by 58% from £29 million to £47 million, whilst in 1974 the number of tourists rose by 32,000 to a new record of 177,000 and the first stage of the KIDATU higher-electric scheme was completed. Above all the great TAZARA FREEDOM RAILWAY from Dar es Salaam to Zambia was completed and was scheduled to start commercial services from the beginning of July 1975 (see below). Other items of good news were the discovery of natural gas on the island of Songo Songo, the start of an oil search in the Indian Ocean, and remarkable 287% increase in the output of tinned meat as a result of improved cattle marketing.

The report mirrors the entire Tanzanian scene and its 68 tables of statistics graphically convey a fascinating variety of information , ranging from retail price indices of food for low income groups in the capital, Dar es Salaam, and the future capital, Dodoma, through the sales of precious stones and the numbers of students in various faculties in the University, to the 87,750,000 dispensary out-patients treated in 1974! More important it succeeds in portraying the excitement and heartaches of the battle against poverty, ignorance and disease, whose initial impulse is being maintained ‘against all disaster’, and the sense of urgency gripping the dedicated few charged with implementing the Development Plan.