Sustainable indicators for Tanzania economy

Posted on February 10, 2017 12:00 am

United Republic of Tanzania has achieved considerable success in reducing poverty that affects many developing countries as well as myriad of challenges like environmental degradation and inequality which present a significant risk to the well being of all of Tanzanians. These are challenges that require local solutions involving all stakeholders.Through promotion of more sustainable development, Tanzania can improve the quality of life and opportunity in the country while also promoting prosperity.This will be vital for Tanzania’s economic future and security.Experts and local opinion leaders always often focus too much on the past when talking about confronting the future of many Tanzanian challenges. There is no substitute for on the ground knowledge and day to day Tanzanian experience to fully understand the dramatic pace of change that has taken place over time and the compelling economic growth opportunities that are now being generated in Tanzania. Many Tanzanian businesses have long-term commitment to the country that is reflected in the way that they serve their customers, invest capital locally, look after their employees and build relationships through sustainable business practices. One of them is Imalaseko supermarket which unlike foreign own supermarkets sells mainly local brands.While some businesses focus on longer-term economic drivers especially in mining industry, they are also encouraged by the near term progress that has been made and which is now being more widely recognised both in Africa and globally.

Since the administration of John Magufuli came to power, the country’s economic turnaround is underway and much of the credit must go to President Magufuli’s government, which has been releasing steady stream of fiscal packages since January 2016 to promote investment. Ease of doing business in Tanzania has improved and this has been recognised in a report released recently. The improvement is attributed to government efforts to streamline unnecessary regulation. Not content with this improvement, President Magufuli aims to make even Tanzania a better place for genuine businesses. Other economic indicators are heading in the right direction. Tanzania’s inflation rate has eased to less than 5 percent year on year, and overall unemployment has reduced to 5 percent as of January 2017 from 7 percent in same period 2016. There is more good news with Tanzania’s consumer confidence steadily improving over the year and the recent consumer confidence index shows Tanzania as the second-most confident nation in the Sub Sharan Africa in the last quarter. To maintain Tanzania’s economic momentum, clearly infrastructure investment with a clear and high multiplier effect for the broader economy is going to remain a key economic driver. Last February, President Magufuli named priority infrastructure projects for the 2016 to 2020 period, including airport expansion, railway lines, roads and power plants. It has been estimated that such investments are likely to require several tens of billions of dollars. All this comes as foreign direct investment in Tanzania rose year on year to the highest amount on record in the last quarter of 2016, according to Bank of Tanzania data.

Tanzania has business that have a strong track record of investment in infrastructure and will be actively seeking opportunities to employ capital in this important economic growth driver. However, the challenge of maintaining the growth rates of previous years remains very real. Tanzania’s third quarter growth came in at less than expected, despite continued monetary easing over the first half of the year which was below percent average for the last decade, and lower than expectations of 7 percent or more. Despite this, the government is boldly predicting economic growth to exceed 8 percent in 2017. Tanzanians have never failed to rise to economic and social challenges and many of them are confident with the current regime to take the country to greater heights.In conclusion, sustainable indicators of economy represent goals and targets that can make Tanzania itself more prosperous, fair and sustainable and this include but not limited to improving gender equality and eliminating non communicable diseases. Also, more sustainable consumption and production, reduced carbon emissions, and support for local development will definitely make Tanzania a great country.Perhaps one of the most significant applications of the sustainable growth to Tanzania will be in helping reduce the gap between urban and rural Tanzanians. A core principle underpinning such growth is that no one is left behind and the growth targets are met for all income and social groups, particularly disadvantaged communities in rural Tanzania.Rural Tanzanians have been well and truly left behind on health, education and employment indicators. The sustainable growth indicators provide an opportunity to redress this.

Contador Harrison