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TANZANIA IN PERSPECTIVES OF GLOBAL

ECONOMY

Nicolaus Shombe
PHD14407
23rd December, 2014

Outline
Part I: Pre-colonial era
The social forms of pre-colonial Tanzania
Society and economic activities
Trading with outside traders

Part II: Colonia era


German Rule (1890 1914)
British Rule (1919)

Part III: Post colonialism

Independence
State formation
Socialism and Arusha declaration
Colonial legacy and colonial path dependency

Tanzania Overview
Population 47.4 million
(2014 estimates)
Total area - 947,303 km2
GDP (PPP) - $86.4 billion
(2013)
Per capita - $1,813 (2013)
GDP (nominal) - $36.6
billion
Per capita - $768

PART I: Pre-colonial Era


The social forms of pre-colonial Tanzania
Tanzania is ethnically varied and fractionalized, without
dominant groups.
A variety of political organizations ranging from complete
statelessness to chiefdoms

Society and economic activities


The economy was predominantly subsistence, with wide
variation in rainfall and land productivity.
Characterized by small scale production using family labor and
simple technology.
Clothes were widely made from bark and local cotton (there is
archeological evidence of weaving before 15th C)
There were crafts (often with tribal specialties), providing a
basis for specialization and regional trade, iron smelting.
Pastoral peoples who ranged across the territory and hunters
Trading salt, pots, animals, weapons and crops among society
e.g. tobacco and food .

Part I: pre-colonial era Trading with outside traders


According to the literature Arab Mercantile traded in Indian
Ocean from 1000 A.D, Tanganyika Coast became commercially
important around 1200 but before that early center of gravity
was in Zanzibar, Mombasa Kenya and Somalia (Iliffe J, 1979)
1505 Portuguese traders arrived
1698 Portuguese expelled by locals and Arabs
Slave trade transported slaves to the Gulf, Oman and French
plantation colonies (in 1770s about 6,500 per year)
Long-distance trade from Inland to Costal through trade caravan
grew in (18th C) i.e. salt, ivory, rhino horns, copper, food
exchange with cloths etc

Coastal society traded with Asians, Arabs and Europeans i.e.


Exported - wax, gum, ivory, tortoise shell, coconut oil, palm oil
and slaves.
Imported - ceramics, clothes, ammunition, arms, hardware and
dates from Asia and Middle East

PART II: Colonial era


Tanganyika Economic history under German Rule (1890
1914) following the Berlin conference of 1884.

Constructed railway in early 1900s


German East African Company (Chartered Colonial
Organization) opened plantations, i.e. coffee, sisal
Abolished ivory trade and introduced rubber, which
benefited commoners at the expense of rulers
Monetization and taxation
Introduced forced labor system (kipande, piece work,
taxation, killing live stocks)
Majimaji Rebellion 1905 - 1917

PART II: Colonial era

British Rule (1919)

British ruled Tanganyika as mandated territory


Used indirect rule
After WWII
The WWI transformed Tanganyika's relationship with
Britain.
With an exhausted economy, colossal debts, and a
disintegrating Asian empire, Britain at last needed even
Tanganyika's meagre resources, if they could be
extracted.
The post-war decade therefore saw a 'second colonial
occupation, embodied in development planning and
secondary industry, cash-crop expansion and agricultural
improvement schemes, educational advance,
constitutional progress, and local government reform

Part III: Post colonialism


Independence
Julius Nyerere was a charismatic leader of the nationalist
movement, and was the major philosopher and architect
of independent Tanzanias development policy.
Introduced idea of the peasantry and Ujamaa (socialism)
Declared war against three enemies (i) poverty, (ii)
ignorance and (iii) Diseases

State formation

Independence - 9 December 1961


Zanzibar Revolution - 10 December 1963
Merger 26 April 1964 (Formation of UR of Tanzania)
Ideology of socialism lay a great foundation to ensure that
people are equal before the law and everyone is
responsible for the development of the country.
Kiswahili greatly helped integrate national and exposed
called 'national identity

Socialism and Arusha declaration


Nyerere frequently commented on the centrality of hard
work in traditional life, and placed a high value on it.
Communal land ownership implies egalitarian community
relations
Arusha Declaration in 1967, launched a socialist
development agenda. It was characterized by policies
based on extensive state control of the economy.
Government control was greater than in any other country
in sub-Saharan Africa.
A state monopoly characterized Tanzania's economic
management.
Production by small farmers was strictly under communal
rural groupings called ujamaa villages.
Produce by these small farmers was marketed either by
'top-down-created' co-operatives or state owned crop
authorities.
state owned Regional Trading Companies

Collapse of Socialism in Tanzania


Nyereres departure in 1985 signaled a break from socialist
policies and gradually allowed the market economy.
Tanzania experienced steady economic decline in the
late 1970s partly contributed by Uganda War and a
financial crisis in the early 1980s, Oil Crisis, Droughts,
and collapse of commodity prices,
Economy was in bad shape, food shortage, lower foreign
reserves, balance of trade deficit, rate, high inflation,
heavy External Debt and high unemployment,
Nyerere retired in 1985 and went to his Village because
he was not ready to implement IMF conditionalities
which he had resisted for many years,
Tanzania formally adopted an economic recovery
program in 1986,

Tanzania after Nyerere


Structural Adjustment program.
Privatization of former state-owned enterprises
Institutionalization of fiscal and financial reforms and
trade liberation
Change political system multiparty
The emergence of the private sector.
President Mwinyis liberalization efforts post -1985 and
initiation of institutional and structural reforms
President Mkapa reinforced the importance of
macroeconomic stability
and ensured consolidation of a free market economy, after
1996.
President Kikwete strengthened macroeconomic stability and
economic infrastructure development

Colonial legacy and colonial path dependency


Tanzania like most of Africas economic performance since
independence has been poor. This poor performance is
caused, among other factors, by two events: the slave
trade and colonial rule: Tanzania was a non-settler colony, the colonizers
focus was on exploitation, weak institutions of
private property were established and these poor
institutions persist today.
effects of assassinations of indigenous leaders by
Germans during colonialism,
Colonial rule created dependence syndrome
politically and economically which still persist.
Slave trade still has a significant and sustained
impact on political and social institutions in Africa

Positive impact of Colonization


Before colonization Tanganyika did not exist,
Different laws operated among the constituent
tribes and there was conflict between them. It
was the colonial power which imposed a
common law and maintained it by force.
Introduction of formal western education
Construction of infrastructures e.g port and
railway
Introduction of new crops

Conclusion
Tanzania is most stable countries in Africa
Economy has been growing at average of 7% for
the past decade with stable macro economic
indicators
Still agrarian economy with 75% of population
Still depending on the export raw material
including crops and minerals and import
manufacturing goods
Series of events (Slave trade, colonialism,
socialism and market economy) disturbed growth
path of Tanzania

REFERENCES
Austin G, (2008), the Reversal Of Fortune Thesis And The Compression Of
History: Perspectives From African And Comparative Economic History
Herbst . J, (2002). States and Power in Africa
Iliffe J, (1979), A Modern history of Tanganyika. Cambridge university press
Nunn. N, (2007). Historical legacies: A model linking Africas past to its current
underdevelopment

Nyerere in Action

2011