Economic reforms and the prospect for sustainable development in Tanzania

Abstract

The objective of the Macroeconomic Reforms and Sustainable Development in Southern Africa project was to facilitate the attainment of sustainable development objectives agreed at the United Nations' Earth Summit held in Rio de Janeiro, Brazil, in June 1992, in which Tanzania participated. The two natural resource-based sectors of tourism and mining were chosen for analysis. Despite the difficulty of linking policy explicitly to particular economic activity performance, macroeconomic indicators show that economic policies stimulated economic activity resulting in, among other things, a significant increase in economic growth, declining inflation, declining deficits, and an increase in tax revenue collection. The mining and tourism sectors' share of GDP increased significantly, and both sectors have contributed greatly to employment generation. However, these economic gains have come at the cost of environmental degradation, social hardship and the breakdown of social norms and values. Such results indicate that the country is not yet on a sustainable development path. While good policies exist and are being improved, there has been a failure of policy implementation over the years. With good policies, appropriate integrative strategies, commitment and political will, the country may attain a sustainable development path.