The impact of IMF structural adjustment policies on Tanzanian agriculture

by Ross Hammond

in association with The Evangelical Lutheran Church, Tanzania

1998

EXECUTIVE SUMMARY

The IMF structural adjustment program in Tanzania began in 1986, with additional agreements signed in 1987, 1991 and 1996. As agriculture is by far the most important sector in terms of employment (over 80 percent), contribution to GDP (over 60 percent) and foreign-exchange earnings (75 percent), much of the Fund's policy interventions have focused on that sector. While agricultural production and exports have increased since the adjustment program began, so have rural poverty, income inequality, food insecurity, malnutrition and environmental degradation. As a result, Tanzania has become ever more dependent on foreign aid.

The key elements of the adjustment program in Tanzania have been devaluation, cuts in subsidies, and trade liberalization. These measures have dramatically increased the prices of inputs for the production of both food and export crops. Between 1989 and 1992, for example, the price of fertilizer increased between 183 and 412 percent, depending on the type. At the same time, producer prices for food crops decreased. Between 1985 and 1991, these prices fell for maize (30 percent), paddy (11 percent), cassava (32 percent), sorghum and millet (40 percent) and beans (6 percent). Although there have been increases in nominal producer prices for a number of crops during the decade of the '90s, devaluation and persistent inflation have more than wiped out these gains. Since state marketing and pan-territorial pricing programs were ended, small farmers in remote areas have found it especially difficult to market their crops. The World Bank reports that, while "[…]rich farmers negotiate selling prices with private traders, the poor sell in smaller quantities and at lower prices." Despite these problems, the IMF's Policy Framework Paper for 1995/96 to 1997/98 focuses on improving "marketing efficiency" rather than on fairness.

Consistent with the demand of the IMF for a tight monetary policy, the government has sought to lower inflation and increase the domestic-savings rate by raising interest rates. This has greatly increased the budget deficit, since a large portion of domestic debt is owed by government-owned parastatals. It has also contributed to raising informal-sector interest rates as high as 100 percent. The high interest rates, coupled with the privatization of the Co-operative and Rural Development Bank, has meant that credit for small-scale agriculture has virtually disappeared. According to the Fund, the private (mostly foreign) banks now operating have restricted their activities "[…]mostly to trade financing in Dar es Salaam, avoiding for the most part domestic lending activities."

Under the IMF program, food security in Tanzania has diminished considerably. While this problem can be linked to the impact of drought on the already vulnerable agricultural sector, the acute food shortages over recent years are also attributed by analysts to the removal of subsidies on fertilizers. The World Bank's 1996 Country Economic Memorandum reported that food intake levels have stagnated due to the "[…]limited accessibility to food and the rising cost of living." Currently, over 40 percent of all Tanzanian children under five years of age have stunted growth and 90 out of 1,000 children born in the country die before their first birthday. Despite modest gains in real GDP growth, the World Bank reports that such basic human-welfare indicators as infant mortality, nutrition, housing conditions and primary-school enrollment "[…]appear to be stagnant or worse, compared to the level of the 1970s or early 1980s."

The problem of food insecurity has been exacerbated by the high and worsening degree of income inequality in Tanzania. The IMF's program has failed to benefit those who most need an increase in income and in fact has worsened the economic situation for Tanzania's poor. Between 1983 and 1991, the better-off saw their incomes from agriculture rise by 279 percent, while the poor and very poor experienced income decreases of 42 and 60 percent, respectively. In 1983, the average adult equivalent of income for the richest income group was 24 times greater than that for the poorest group. By 1991, that figure was 1,454 times greater due to the large proportion of the population with zero or even negative incomes. Those living in households with income below the "hard core" poverty line (over eight million people in 1991, or 42 percent of the population) had lower incomes in 1991 than in 1983.

Environmental degradation has also increased since the adjustment program began, as people become more desperate to produce on any lands available. Between 1980 and 1993, one-quarter of the country's forest area was lost, exposing even greater areas of land to wind and water erosion. Deforestation is currently occurring at a rate of two percent a year. Forty percent of this loss is a result of land clearing for cultivation. Another cause of deforestation is the cutting of wood to cure tobacco. Tobacco cultivation has been encouraged under adjustment in order to increase foreign-exchange earnings.

I. Introduction

Agriculture is by far the most important sector in Tanzania in terms of employment (over 80 percent), contribution to GDP (over 60 percent) and foreign-exchange earnings (75 percent) .⁽¹⁾ Eighty-five percent of Tanzania's people reside in rural areas, most of them engaged in agriculture. Over half of Tanzania's farmers cultivate less than one hectare, and 98 percent cultivate less than five hectares. Small farmers are, by any measure, the backbone of the Tanzanian economy. They account for over 80 percent of agricultural production and exports and produce the bulk of the food and raw materials.

As agriculture has comprised such a large segment of the economy, the International Monetary Fund (IMF) has focused much of its policy intervention on the Tanzanian agricultural sector throughout the history of its financial assistance to Tanzania. The government's agricultural policies in the 1960s and 1970s did produce massive distortions that required major reforms and external assistance from the IMF and World Bank. As a result, the Fund has long targeted agricultural policies related to exports, pricing and marketing arrangements in its loan conditionality Hence, the IMF's loan conditionality has not only strongly shaped general macroeconomic policy in Tanzania, it has also played the dominant role in restructuring the nation's agricultural policy. In addition, as the Fund set the framework for economic policy in the country, World Bank and donor government aid filled in the financing gaps. The IMF's policies, therefore, also played a major role in determining how other aid would be channeled and directed.

Any examination of the effectiveness of the IMF's lending programs and adjustment policies in Tanzania must therefore assess the performance of the agricultural sector and the livelihoods of farmers, the majority of the country's citizens. This paper will perform such an analysis and, in turn, will examine and assess the policies the Fund has prescribed for the sector. It will look at the macroeconomic effects of these policies, on which the IMF focuses its own analysis, but will also look more comprehensively at how these impacts have affected life at the micro level for Tanzanian citizens, focusing on the issues of food security, real income and environmental resources.

II. Background to the Economic Crisis

Throughout its history, Tanzania has been an agriculturally based economy, and officials have therefore long targeted the agricultural sector as the principal source for growth and revenue in the economy. The sector has also been plagued, however, with inefficiencies, price fluctuations and other difficulties, and many of these difficulties continue to burden the economy.

Following Tanzania's independence in 1961, the government implemented state-led agricultural policies to increase agricultural exports and modernize peasant production. The government channeled subsidized credit and inputs through agricultural cooperatives and expanded the size and scope of marketing boards. In addition, the government greatly increased the size and scope of credit and input programs, expanded the marketing role of parastatals, and called for the voluntary movement of the rural population into villages, where, it was argued, production and the provision of social services could be undertaken more efficiently. In 1973, the government decreed that the entire rural population should be in villages within three years and set out to enforce this policy. Between 1973 and 1976, 80 percent of the rural population was forcibly moved into these villages. State spending on agriculture reached historic levels during this period, with hundreds of millions of dollars in donor funds going to build up agricultural parastatals and finance large-scale projects (with equally large-scale losses) related to the production of maize, tea, tobacco, cashew nuts, pyrethrum, beef and dairy products, as well as for "regional integrated planning".

Forced "villagization", the expansion of monopolistic marketing institutions, and political interference in the running of the cooperatives led to a rapid decline in agricultural production and a tremendous increase in domestic debt. By 1979, faced with food shortages, a large rise in oil prices and a crippling war with Uganda, the government turned to the IMF for help with balance-of- payments support. A Stand-by Arrangement was subsequently signed but later canceled following the government's failure to fully implement IMF-mandated budget cuts. Subsequent discussions with the Fund foundered over the government's refusal to implement "shock therapy" measures, including a huge currency devaluation.

With a cutoff of aid from the IMF and hence the World Bank and many bilateral donors, Tanzania was faced with a foreign-exchange crisis of unprecedented proportions. Consumer goods and essential commodities all but disappeared from the shops, causing queuing and an explosion of black-market transactions. Adding to the crisis was the increasing diversion of food and export crops onto the black market, depriving the government of much-needed revenue and forcing consumers to pay extortionary prices for basic commodities.

Without assistance from the international financial institutions, and as an alternative to the IMF program, Tanzania implemented its own adjustment program, which emphasized increasing agricultural production, particularly for export, in an attempt to alleviate both food and foreign-exchange shortages. It devalued the shilling, removed maize-meal subsidies, raised real producer prices for food and export crops, allowed limited private trade in grain, and introduced an 'own foreign exchange' scheme whereby individuals could import goods without having to declare the source of these funds.

By the 1985-86 season, producer prices were fixed for only 18 main crops, as opposed to 40 a few years earlier. These changes did alleviate somewhat the shortage of consumer goods and increased agricultural production, but the almost total cutoff in donor funds exacerbated the economic crisis and forced the government to reopen negotiations with the IMF.

III. Enter the IMF: A Series of Adjustment Programs and Policies

When the IMF re-entered Tanzania in 1986, it brought with it a series of credits and mandated adjustment programs and policies that spanned the course of the next decade.

A. 1986 Stand-by Arrangement

In 1986, the Fund finally agreed to grant Tanzania a 64.2 million SDR stand-by credit (about US$90 million at today's rates). This was followed quickly by the signing of an Economic Recovery Programme with the World Bank. In conjunction with the Stand-by, these loan agreements laid out the changes that would be required of Tanzania if it was to continue to access donor funds.

The stated goals of the adjustment program included an increase in the output of food and export crops, a reduction in inflation, an increase in foreign-exchange earnings, a restoration of macroeconomic balance, and the elimination of government involvement in the marketing and distribution of both crops and agricultural inputs. The economic growth these measures were intended to foster, it was asserted, would help reduce poverty in the country.

Responding to the IMF's demands, the government quickly announced that it would raise agricultural producer prices (to 60-70 percent of the world market price), devalue the currency (within a year the shilling was depreciated 57.5 percent in U.S. dollar terms), and decontrol prices on most consumer goods. Soon after, it removed all barriers to the transport of food grains by private traders and restricted the role of the National Milling Corporation (NMC), which had previously been responsible for the bulk of maize purchases. Controls on the importation and distribution of all agricultural inputs, including fertilizer and seeds, were removed; cooperatives and the private sector were allowed to compete with the NMC in grain milling; the export of food grains was liberalized; inter-regional trucking rates were freed; and regional cooperative unions and primary societies were allowed to sell food grains directly to private traders.

B. 1987 Structural Adjustment Facility

The next year, Tanzania entered into another agreement with the IMF, this time for a three- year concessional (0.5 percent interest) loan from the IMF's Structural Adjustment Facility (SAF). The loan totaled SDR 67.9 million. The objectives of this arrangement were to increase per capita incomes, reduce inflation to under 10 percent, reduce the budget deficit (by cutting spending), further decontrol agricultural prices, and restructure (i.e., privatize) the parastatals.⁽²⁾

C. 1991 Enhanced Structural Adjustment Facility

Following the three-year SAF program, Tanzania borrowed SDR 181.9 million (US$242 million) for a similar three-year Enhanced Structural Adjustment Facility (ESAF) loan program to further support its economic-reform program. This program essentially called for the continuation of the existing liberalization policies, including exchange-rate and trade liberalization. The IMF also insisted upon measures to attract investors, broaden the revenue base, liberalize interest rates, and reform the public-enterprise sector and civil service (through privatization and lay-offs).

In response, the government moved from a system of fixed producer prices to an 'indicative' (floor) price system, which set a minimum price as a guide for farmers in negotiating sales. In 1994, even the indicative price system was abolished. As a result, private traders now handle most grain transactions and prices paid to farmers are determined by market conditions. The same is true for traditional export crops like coffee, tobacco, cashew nuts and cotton, with fixed producer prices being abolished in 1993. The government has also removed itself from the distribution and subsidization of agricultural inputs, the price of which is now also determined in the market.

By 1994, the government had stopped intervening in the foreign-exchange market. The value of the Tanzanian shilling (Tsh) against the U.S. dollar is now determined in weekly foreign exchange auctions. The exchange rate (as of August 1997) was approximately 630 Tsh./US$1, compared to 33 Tsh./US$1 when the adjustment program began in 1986. The government also raised interest rates, which stood at over 30 percent at the end of last year.

D. 1996 Enhanced Structural Adjustment Facility

On 8 November 1996 the IMF approved a US$240 million ESAF loan for Tanzania with which to continue the adjustment program. In return, the government agreed to fire more than 20,000 civil servants, impose stricter government spending targets, reduce the money supply, bring inflation down to ten percent, impose a Value Added Tax, and speed up the privatization program. Approximately US$1.2 billion in pending bilateral aid was linked to the approval of the ESAF loan. ⁽³⁾ In addition, the government, under IMF pressure, agreed to liberalize petroleum retail prices sometime in the next few years, a move that is sure to send shockwaves throughout the economy.⁽⁴⁾

IV. Assessment of the Reforms: Macroeconomic and Sectoral Impacts of Adjustment Policies

The reforms enacted since 1986 have had an enormous impact on all sectors of the Tanzanian economy, especially agriculture. From a single-channel marketing and distribution system for both inputs and outputs with fixed prices and centralized planning, Tanzania's agricultural sector is now freer than those of its major donors. What has been the impact of these changes, particularly on the majority of Tanzania's citizens – its small farmers? Has production increased? Have producer prices gone up? Are Tanzania's small farmers moving out of poverty?

This section will address these questions by first examining the sectoral and macroeconomic impacts of these programs. However, this case study will probe deeper into the impacts of structural adjustment by examining poverty and income effects and the impact on food security and the environment.

A. Inflation and Debt on the Rise

The adjustment program has been inconsistent in holding down inflation, one of its primary goals. After an initial decrease in the first few years of the program, inflation began to rise again, reaching 36 percent in 1994 and 28 percent in 1995 (about the same as in the so-called 'crisis years' of 1982-1985). Even these figures seriously underestimated actual price increases. In Tanzania, food accounted for 64 percent of the weight in the consumer price index during the 1990s. Between November 1990 and November 1991, the open market price of food rose by 75 percent, although the official inflation rate was only 22 percent. This implies that during the same period the non-food component of the CPI fell by 75 percent – clearly an absurd proposition. ⁽⁵⁾

Other macroeconomic indicators are equally disturbing. The country's total debt rose from US$4.9 billion in 1986 to US$6.5 billion in 1994 and, as a percentage of GDP, from 103 percent in 1986 to 285 percent in 1992. The current-account deficit also increased from 1990 to 1993 and continues to remain high.

It's a struggle to survive, to make ends meet. Because of inflation we get less for our crops than ten years ago. Our plots are too small to help us. Improved seeds, fertilizer and transport are available but are too expensive[…]. Ten years ago we were much better off because the cost of living is so much higher now. Yes, there are a lot of things in the shops now but you can only enjoy them with your eyes. We can't afford them[…].. The government has forgotten about us. They have received money from the World Bank and IMF and distributed it amongst themselves so they've forgotten those of us with no money. The money goes to the ministers while we continue to suffer here. We can't educate our children or get medical care. It's the big businessmen who are doing well, not the small farmers.
– W. Limo, Kilimanjaro District

B. Rising Agricultural Input Prices

In conjunction with trade-liberalization measures and the IMF-mandated termination of subsidies, devaluation has dramatically increased the prices of inputs required for both food and export crops. Between 1989 and 1992 alone, the price of fertilizer increased between 183 and 412 percent depending on the type. ⁽⁶⁾ The price of improved seed varieties has also gone up under the adjustment program. Between 1986 and 1991, retail prices for improved varieties of maize seeds increased by an average of 40 percent in real terms and, for other types of seeds, by an average of 30 percent. ⁽⁷⁾ During the same period, there was a 60-percent decline in the number of households using these improved varieties. ⁽⁸⁾

C. Falling Producer Prices

Despite grain shortages, food producers have seen prices for their crops go down. While fertilizer prices have skyrocketed, there has been a reduction in farm-gate prices for most of the country's food crops, with the exception in the first few years of the adjustment program. Between 1984/85 and 89/90-91/92, for example, producer prices fell for maize (30%), paddy (11%), cassava (32%), sorghum and millet (40%), and beans (6%). Although there have been increases in nominal producer prices for a number of crops during the decade of the 90s, devaluation and persistent inflation have more than wiped out these gains. ⁽⁹⁾

Before, the cooperative union bought our crops but now it has collapsed. They say the employees ate the money. Now we sell our crops in the market. Although the price we get is not very good, we have to sell in order to get money to pay for school fees, medicines and other expenses. The system before was better because you would take the crop to the market knowing the price. Now you don't know what the price will be[…].. If I were the Minister of Agriculture the first thing I would do would be to lower the prices of inputs. Then I would raise the prices of our crops and have an assured market.
– J. Metui, 46 year-old farmer, Arumeru District

D. Inadequate Financing for Extension Services

Government spending on agricultural services has been declining in real terms for over a decade, remaining below two percent of GDP since 1984. Expenditures for agricultural extension, for instance, fell by almost 30 percent in real terms between 1986 and 1991, ⁽¹⁰⁾ leading to shortages of trained personnel and inadequate financing for extension activities. "These problems were rampant well before the economic recovery program," says the World Bank, "but have not improved under the program and in some cases have deteriorated further." ⁽¹¹⁾

E. Declining Credit Availability

At the same time that the price of fertilizers and other agricultural inputs have been going through the roof, the means to finance purchases of these inputs have all but disappeared.(*1) As part of the tight monetary policies demanded by the IMF, the government has sought to lower inflation and increase the domestic savings rate by raising interest rates.

Raising interest rates has had a number of detrimental impacts. First of all, it has greatly increased the budget deficit since a large portion of domestic debt is owed by government-owned parastatals. Since hard budget constraints were only imposed on these parastatals in the last few years, higher interest rates did not have an appreciable impact on the level of borrowing but instead merely raised its cost. The raising of rates in the formal market has affected the informal credit market as well, with interest rates reaching 100 per cent per annum for short-term credit from rural money lenders. ⁽¹²⁾

The Co-operative and Rural Development Bank (CRDB), which had previously provided credit to the cooperatives, was privatized in 1996 and is now run on a commercial basis. Large financial losses, mismanagement and corruption have plagued the CRDB since its inception, and there is no question that it needs restructuring. However, there are no concrete plans to provide credit in the rural areas. Instead there are vague references in the IMF Policy Framework Paper (PFP) to government efforts to facilitate the establishment of "community-based intermediaries" to provide savings and loan functions and the creation of "opportunities" for private commercial banks to extend their operations into the rural sector. ⁽¹³⁾ How these goals will be implemented and/or funded is not spelled out.

Although the banking sector has been liberalized, the IMF says the private (mostly foreign) banks now operating have restricted their activities "[…]mostly to trade financing in Dar es Salaam, avoiding for the most part domestic lending activities." ⁽¹⁴⁾ Although official statistics show an increase in lending for agriculture during the adjustment period, this increase went to large rather than small farmers since commercial banks typically have a minimum loan amount of one million shillings, as well as strict collateral requirements that small farmers cannot meet. ⁽¹⁵⁾

With the CRDB crippled, the new commercial banks only financing import-export trade, and the World Bank and other donors funding at best isolated rural credit schemes, small farmers will be left at the mercy of rural money lenders or, more likely, will not have access to credit at all.

We haven't been able to get a loan for years. Sometimes you can borrow from a neighbor but that's not easy unless they trust you. Times are hard and people no longer trust each other as much. Borrowing money is easy, it's paying it back that's difficult![…].We hear there are changes. We hear that the government is providing loans, but we haven't seen them.
– M. Meikumishi, Arumeru District

F. Uneven Production Gains

Growth in Tanzania's agricultural sector was particularly weak before the implementation of the adjustment program, with production increases averaging only two percent annually between 1978 and 1985. Between 1986 and 1991, agricultural GDP grew at an impressive annual rate of 4.9 percent, ⁽¹⁶⁾ but this growth was not uniform. The World Bank's 1994 Agriculture Sector Memorandum states that cereal production declined during the reform period from a growth rate of 5.7 per annum between 1976 and 1980 and 4.3 percent per year between 1981 and 1985 to 0.2 per annum between 1986 and 1991. ⁽¹⁷⁾ Maize production, however, rose during the early years of the reform period at an annual average of five percent , as did the production of paddy and pulses, with pulse production also growing at over five percent per annum, according to Bank figures. ⁽¹⁸⁾ Msambichaka (1995) puts the annual growth of maize production between 1986/87 and 1993/94 at a much more modest 0.2 percent and that of paddy at 1.2 percent and root crops (mainly cassava) at 8.4 percent. The population growth rate during this period was 2.8 percent per annum.

Whether even this modest growth was a direct result of adjustment measures is another matter. Unusually good weather in the early years of the program was a major factor, particularly when one considers the fact that the overwhelming majority of agriculture in the country is rain-fed.

These production increases are also attributable to the expansion in area cultivated. There has been a large increase in acreage planted during the adjustment program. Between 1987 and 1991, for example, the area cultivated with maize grew by an annual average of 5.1 percent (a growth rate almost identical to the rate of increase in production), while for paddy it increased by an annual average of 7.4 percent. ⁽¹⁹⁾ This has extremely negative environmental implications for Tanzania, a point which will be discussed later.

Another factor is the inclusion of previously unrecorded transactions as farmers began to respond to market liberalization. Official figures are exactly that – official. They do not capture that which is sold on the black, or 'parallel' market. With an artificially high exchange rate and low producer prices in the pre-reform period, much of the agricultural surplus was either smuggled out of the country or, in the case of food crops, sold on parallel markets. With devaluation and the freeing up of marketing, the size of these parallel markets was reduced dramatically. That which had previously been sold in those markets is now 'captured' in official statistics, creating the illusion that more is actually being grown. In any event, the average annual growth rate in agricultural production over the next five years fell to 3.5 percent, with a significant shift away from basic food crops to export production.⁽²⁰⁾

G. Falling Productivity

While official maize production figures may have risen in the initial years of the adjustment program, maize productivity has been steadily declining despite the millions of dollars that have been spent over the years trying to boost it. The maize yield per hectare is currently about a third of the world average. Coffee yields have also been falling due largely to the declining use of inputs. The cost of fungicides, which constitutes the single largest input expense in coffee production, has gone up because of devaluation and the lifting of subsidies. The price increase resulted in a drastic decline in the use of fungicides, which has led to increased incidence of disease. Not surprisingly, there has been a "catastrophic fall in yields" according to the World Bank, from an average of around 400 kilos of clean coffee per hectare in 1981-82 to some 230 kilos per hectare in 1991/92. ⁽²¹⁾ Currently, the yield per hectare in neighboring Kenya is 500 kgs. ⁽²²⁾

The main constraints to increasing agricultural productivity, as the Bank points out, "[…] relate to the need to access more productive technology, including tools and extension service support; supply of inputs, including chemical fertilizers, fuel and financial services; and provision of rural infrastructure, including transport and water resources." ⁽²³⁾ Unfortunately, many of these things have become scarcer and/or more expensive under the adjustment program. By the 1993/94 growing season, only 20 percent of all rural households were using agricultural inputs, with the richest farmers three times as likely to be using inputs as the poorest. ⁽²⁴⁾

My income is a bit higher than before but everything has become much more expensive so it buys me less[…].. The cost of pesticides is a real problem for me. So much of the money I make from my coffee goes to buying more pesticides. Some people in this area have abandoned growing coffee altogether. Other farms have been ruined because there is not enough money for pesticides and fertilizers, and the hybrid varieties of coffee are not disease resistant. Before, the government would lend fertilizer through the co-ops. Now the Arabs and the Indians are buying coffee from the people. The price is a bit higher but there is no way these people will lend you money to pay for your inputs.
– J. Malyi, Kilimanjaro District

The increase in seed prices, the ending of fertilizer subsidies and the abolition of 'pan-territorial pricing' (whereby maize farmers, no matter their location, received the same price for their crops) have negatively impacted maize production, which had risen in the early years of the adjustment program. Pan-territorial pricing, introduced in the mid-1970s, led to huge increases in maize production in the 'big-four' southern highland regions (Iringa, Rukwa, Ruvuma and Mbeya), which came to produce over one half of the officially marketed supply of maize .(*2) This expansion in production was supported by successive donor-funded programs for the supply of seeds and fertilizers, the latter made especially necessary by the fact that the soils in the southern highlands have a lower nutrient content than those in the North and thus require heavier applications of fertilizer. ⁽²⁵⁾

Unfortunately, current donors seem to be operating from the belief that it is mainly backwards agricultural techniques that are hampering production rather than low producer prices, lack of access to credit and other agricultural inputs, poor transportation networks, and the existence of monopoly behavior among traders. As a result, millions of dollars of donor funds will be poured into the World Bank's rather expensive 'Training and Visit' system, which encourages more (but not necessarily more efficient) applications of fertilizers and pesticides. Given the fact that prices for these goods have skyrocketed with devaluation and the ending of subsidies it is not clear how well this message will be received by small farmers. But the Bank pushes on:

The farmer seems to have responded quite well to both price and market liberalization and has been very receptive to the extension message. They don't broadcast seed anymore, they plant in straight rows. One can see this in the Arusha and Kilimanjaro areas. Just look at the fields. They are very neatly kept. This was not always the case.
– World Bank Resident Representative, Dar es Salaam

H. Marketing Crisis

While the liberalization of food-crop marketing has led the IMF to declare that Tanzania is moving towards a "free, fair, and competitive agricultural and marketing system for major crops," ⁽²⁶⁾ there is little evidence of this. The World Bank reports that while "[…]rich farmers negotiate selling prices with private traders, the poor sell in smaller quantities and at lower prices." ⁽²⁷⁾ At best, small farmers now find themselves at the mercy of private traders. At worst, there are simply no buyers. This is especially true in remote rural areas, where a majority of Tanzania's small farmers reside.

With the NMC having effectively ceased to function and most cooperatives insolvent, small farmers are dependent on private traders to purchase their crops. Many of these traders do not even travel to their areas, however, due to the high transport costs involved. The horrendous state of rural feeder roads and the increased cost of spare parts and fuel due to devaluation have greatly increased operating costs for these traders. If they do go into remote areas, they offer very low prices, which most farmers have no choice but to accept. Given the costs involved, many farmers see little point in expanding production when profit margins are low or non-existent .

For example, farmers interviewed in the village of Vunta in Same District, which is only 18km. from the Hedaru market on the newly resurfaced Moshi-Dar es Salaam road, must hand-carry their produce due to the poor state of their feeder road and the subsequent lack of transport. Faced with spending an entire day hand-carrying at most 20 kgs. of maize, for which they will receive around 1500 Tshs. (US$2.50), those farmers who can afford to do not bother. Farmers interviewed in a number of regions claimed that they were not getting a fair price for their crops and that traders colluded to keep producer prices low and retail prices high.

The private traders won't come to the village, so I have to go to them[…]. In comparison to how hard I work, the money I get is nothing[…]. These guys are racketeers who force us to sell at a low price. Then they hoard the grain and wait until the price shoots up[…]. I've heard about the World Bank and the IMF. They help the big people, not the farmers. Farmers are looked on as people with no value. I believe this because we don't ever see any of this money here. We hear on the radio that a lot of money goes to the government but we don't see it[…]. Farmers are not doing better here. That's a complete lie. It's not true. In our village we don't see any of the changes that these statistics show. We're at the same level we were ten years ago.
– M. Mollel, 39, Hai District

In other areas, food producers have, in the face of falling prices, increased their production in an attempt to maintain their previous income level, adding more downward pressure on prices. Thus the poorest farmers are being locked into the least renumerative sector and their only rational response to lower producer prices for their staples – increased production – will lower prices even further.

Structural adjustment has not been the great success that the IMF and the World Bank assert. Up to now, there has been no significant development impact. As a concept, some of it is very good, especially on the marketing side. But the system is just not working in the rural areas. Of course, the IMF and the World Bank, as initiators of this process, have all the reasons in the world to say the program has been successful. But go out to the countryside and you'll see. The farmers are complaining bitterly. The liberalization of crop marketing has benefitted some farmers but to a large extent it's the middlemen who have made out like bandits. All around the country you'll see them colluding to buy at very low prices and then sell at a high price. They're the ones who are now in control. And most don't bother to trade in inputs. Why should they? Look at it from their perspective. If they take the money they earn from crop sales they can earn super-profits in speculative activities and import-export. If they sell agricultural inputs they'll have a lower profit margin because all of the costs they'll incur in terms of spare parts, fuel, and so on. If they can't sell their supplies they're stuck with them until the next planting season, so they incur yet more transport and storage costs.
– Program Officer, UN Food and Agriculture Organization, Dar es Salaam

Although the liberalization of grain marketing may have improved marketing 'efficiency', it has done little to improve farm-gate prices and, with the ending of pan-territorial pricing, has led to a situation in which most private traders shy away from buying grain from areas far from Dar es Salaam (such as Rukwa and Iringa), thus increasing regional inequalities. In the same vein, the ending of the government monopoly on fertilizer sales, the collapse of the cooperative system (which used to handle distribution), and the decontrol of fertilizer prices have meant that farmers in relatively remote areas, even if they have access to fertilizers (highly unlikely given the transport costs involved), will pay dearly for them.

We know there have been some problems on the marketing side and in getting fertilizers to the farmers in time. We and the Ministry of Agriculture are not quite sure what has caused this, whether there is some manipulation by the traders or whether there are market imperfections[…] It could be there is a lack of competition among distributors or imperfect competition in the transport sector. It's a complex business. We just don't know.
– World Bank Resident Representative, Dar es Salaam

I. Export Constraints

A majority of export crops in Tanzania are produced by small farmers. It was therefore expected that devaluation would benefit those who produced export crops and, by changing the incentive structure, encourage subsistence farmers to move into export production. The anticipated supply response has not been forthcoming, however, due to a number of barriers, some directly connected to other aspects of the adjustment program. These obstacles have limited the ability of small farmers to switch from subsistence to export crops and have greatly increased costs for those already involved in export production.

For example, devaluation has been a double-edged sword. On the one hand, it has succeeded in making Tanzania's agricultural exports more competitive on the international market. But it also has had the unfortunate effect of making the production of those same crops more expensive by greatly increasing the cost of imported inputs. This problem, combined with the drying up of credit for all but the largest farmers, has meant that small-scale producers of export crops have seen little profit from growing these goods.

The system of fixed prices for coffee was better. You had an average price and then if it went up in the world market you got baki (a bonus). So farmers always had stable income – it stayed the same or increased. It never went down[…] Those who are benefitting are the large farmers[…] They can get loans, they can send their own coffee to be cured. The small farmers cannot do that[…] The country is going down the drain. The co-ops have no money, they get loans and cannot pay them back, the banks have no money, there's nowhere to get money now[…] We don't see any evidence that this money from the IMF is helping us or even making it into the country. Even our schools are collapsing. We are rebuilding them ourselves. Where is the aid? Before the schools had desks, now the students are sitting on stones. Maybe it's true that this aid is flowing in, but we don't see this money.
– A. Malyi, Kilimanjaro District

While the adjustment program has been successful in increasing the volume of export-crop production by large-scale farmers, the future is problematic. Compared to 1980 levels, coffee, cashew-nut, sisal and pyrethrum production have gone down, while only cotton, tea and tobacco have increased. Furthermore, the value of Tanzania's agricultural exports dropped sharply after 1987 due to large declines in world prices for coffee and cotton, which in 1996 were approxiamately 50 percent below (in real terms) what they were in 1980. The income terms of trade for some of Tanzania's most important export commodities (coffee, tea, sisal, tobacco) fell at an average annual rate of 4.2 percent between 1975 and 1990,(*3) according to the World Bank. "Prospects for price increases are not that good. In no case "does the forecast for [the year] 2000 show prices returning to the levels of the 1970s"⁽²⁸⁾ says a 1994 report. In 1995, the IMF forecast a two-percent annual decline in Tanzania's terms of trade between 1995 and 1998, nullifying any benefits from increased production. ⁽²⁹⁾

V. The Deeper Impact of Adjustment

A. Growing Rural Poverty and Inequality

The IMF's adjustment programs have failed to benefit those who most need an increase in income and, in fact, have worsened the economic situation for Tanzania's poor. Meanwhile, the degree of income inequality in the country has grown considerably. Between 1983 and 1991, the better off saw their incomes from agriculture rise by 279 percent, while the poor and very poor saw their incomes from agriculture decline by 42 and 60 percent, respectively. ⁽³⁰⁾ The increases in income were due mostly to returns from export-crop production, as revenue from the sale of cash crops increased significantly in relation to food crops. For the poor and very poor, however, the World Bank reported that "[…] all the nominal gains were eroded by the increase in the level of prices, resulting in losses in real terms." ⁽³¹⁾ According to the Bank, "[s]ignificant groups of the rural population have either experienced little or no improvement in their living standards or have suffered a decline in income and consumption." ⁽³²⁾

Prices have gone up for everything – improved seeds, insecticides, fertilizers, you name it. At the same time, there's nowhere we can borrow money to pay for these things. I have 5 children in school and I have to pay school fees for them. At the end of the season I have nothing left. This year I won't be able to rent a tractor to prepare my shamba (farm) so I'll have to go back to the hand hoe. Three years ago a 50 kg. bag of fertilizer cost 4,000 shillings. Now it costs 12,000. I don't understand why it's more expensive now[…] Sometimes the government treats the people like children. They say one thing today and another thing tomorrow. You can't predict. When there are parliamentary elections they come with soft tongues but after you elect a person they'll never fight for your problems[…] I'd rather have the government buy our crops. It's much better for the prices to be fixed rather than this free market system. Consumers prefer to buy things at a very cheap price and don't care about the expenses farmers incur. Even if the government prices were low, they took your expenses into account[…] The government is the parent of the nation and needs to take care of the farmers.
– E. Humbo, Iringa Rural District

Income inequality also increased on a national basis with the introduction of the adjustment program. In 1983, the average adult equivalent income in the richest income group was 24 times greater than that in the poorest group. In 1991, that figure was 1,454 times greater due to the large proportion of the population with zero or negative incomes. When expenditure figures are used rather than incomes, the ratio was 26 times greater in 1991. ⁽³³⁾

In addition to the worsening income disparities, overall poverty has increased dramatically in Tanzania. During the adjustment program, poverty has actually worsened for those classified as 'poor' and 'very poor'. That part of the population living in households with income below the 'hard core' poverty line – over 8 million people in 1991, or 42 percent of the population – had lower incomes in 1991 than in 1983. While the 'better off' saw an increase in their real income of 181 percent between 1983 and 1991, the poor saw their real incomes reduced by 29 percent while the very poor saw their incomes decreased by 42 percent over the same period ⁽³⁴⁾.

The major beneficiaries of adjustment in Tanzania, concludes the Bank, have been private traders who were able to capitalize on trading opportunities provided by the liberalization of imports and the agricultural marketing system, cash-crop producers close to markets and with access to credit, those connected with the transport sector, and entrepreneurs in the service sector. Unfortunately the overwhelming majority of Tanzania's population – small farmers – do not fall into these categories. ⁽³⁵⁾

One has to recognize that agribusinesses and horticultural businessmen are profiting in a quite significant way. The program of course wasn't designed for them, but rather was designed to let the market dictate what it is that people should do and what benefits will accrue to them.
– World Bank Resident Representative, Dar es Salaam

Received economic wisdom tells us that marginal areas shouldn't produce crops that they don't have comparative advantage in. But we don't have a situation like you do in the U.S. where you can say, 'Well, you can branch out of agriculture, you can go into services, you can go into industry'. Farmers here don't have that option. For them, agriculture is the way of life. How else are they going to earn their living? We can't tell them to go work in the industrial sector, because it's dying. We've liberalized, we've opened the borders and suddenly these enterprises are going under; they are not competitive. Government is also retrenching. So, where are all these farmers who lack comparative advantage going to go? Into the informal sector? All of them?
– Personal Assistant to the Prime Minister for Economic Affairs, Dar es Salaam

B. Declining Food Security

Under the IMF's tutelage, food security in Tanzania has diminished considerably. The government, under pressure from the Fund, has abandoned pan-territorial pricing and eliminated fertilizer subsidies despite World Bank warnings that, if maize production in the southern highlands becomes unprofitable, "[…]Tanzania's food security will worsen and greater amounts of foreign exchange will have to be spent on food imports." ⁽³⁶⁾ With the elimination of these policies, the bulk of maize production has in fact moved back to the North of the country, and food security has worsened.

During the early years of the adjustment program, the volume of food imports declined quite dramatically due to the diversion of food from the black market back onto the official market and the increased cost of food imports resulting from devaluation. However, food imports began to rise again by the mid-1990s. While this increase can be linked to the impact of drought on the already vulnerable agricultural sector, the acute food shortages over recent years are also attributed by analysts to the removal of subsidies on fertilizers. ⁽³⁷⁾

Is food self-sufficiency a realistic or desirable goal for Tanzania? Well it's always politically desirable[…] But we believe that prices should tell the farmer what to grow and let the country's own comparative advantage come through[…] Comparative advantage may be in cash crops, so food self-sufficiency may take second place.
– World Bank Resident Representative, Dar es Salaam

The problems with food security are exacerbated further by the high, and worsening, degree of income inequality. Even in years of good harvests, the high degree of rural inequality in the country, has meant that not all Tanzanians have access to this food. Since many rural households do not produce enough food to feed themselves, they have been especially hard hit by the rise in prices. (*4)

As the poor already spend most of their incomes on basic goods for which there are often no lower-cost substitutes, (*5) a rise in food prices has led to a reduction in nutritional levels. Calorie intake levels have not increased over the past decade, says the World Bank's 1996 Country Economic Memorandum, due to the "limited accessibility to food and rising costs of living" rather than a chronic lack of supply. Currently, over 40 percent of all Tanzanian children under five years of age have stunted growth and 90 out of a thousand children born in the country will die before their first birthday. ⁽³⁸⁾ Malnutrition, malaria, and infectious diseases, including acute respiratory infections, "continue to be severe and are on the rise." ⁽³⁹⁾ Despite modest gains in real GDP growth, the World Bank tells us that basic human-welfare indicators – like infant mortality, nutrition, housing conditions, and primary-school enrollment – "[…] appear to be stagnant or worse, compared to the level of the 1970s or early 1980s." ⁽⁴⁰⁾ The increase in rural poverty has also led to urban migration, straining already overloaded health and sanitation systems.

C. Environmental Debacle

The environment in Tanzania has suffered massive losses as a result of the adjustment program. The environmental degradation that has occurred poses severe problems for the country since natural resources such as forests, soil, and water are essential elements in supporting the livelihoods of many Tanzanian citizens, particularly among the poor. In addition to the income losses that are arising from agricultural soil depletion and erosion, Tanzania is losing the ecological services that natural resources provide.

Under the country's adjustment program, increased environmental damage has included massive deforestation. Between 1980 and 1993, one quarter of the country's forest area was lost, exposing even greater areas of land to wind and water erosion. ⁽⁴¹⁾ Deforestation is currently occurring at a rate of two percent a year .⁽⁴²⁾ Forty percent of this loss is a result of land clearing for cultivation; Tanzania is currently losing 400,000 hectares per year to land clearing.

The push behind land clearing is largely a result of the deepening poverty and desperation of Tanzania's small farmers, which have increased under the IMF-directed adjustment program. Faced with declining yields and rising input costs, small farmers have been moving into ecologically marginal areas in order to maintain previous production levels. Meanwhile, large farmers are clearing large amounts of land in order to take advantage of new market opportunities. For these farmers it is cheaper to clear new land than to try to increase existing yields, since farm machinery and fertilizers have become so much more expensive under liberalization. ⁽⁴³⁾

A study by the World Wildlife Fund and the Economic Research Bureau supports these observations regarding land clearing. It concludes that rising fertilizer and agro-chemical costs following devaluation and the lifting of subsidies have led farmers to seek production increases through encroachment into virgin forest land. In such a situation, "[l]arge-scale farmers and crop-marketing institutions[…]stand to benefit by increasing their profit margins, while the majority of smallholder farmers – whose scale of production is very low – will have to bear the cost of living in a degraded environment, with low productivity and consequently low incomes." ⁽⁴⁴⁾

Another cause of deforestation is the cutting of wood to cure tobacco. Under the adjustment program, tobacco cultivation has risen dramatically. Tobacco cultivation has been encouraged since it is seen as a way to increase foreign-exchange earnings. Between 1986 and 1991, the area under tobacco increased by 66 percent. ⁽⁴⁵⁾ Currently, around 40,000 hectares of forest are being cut down annually to provide firewood for tobacco curing. ⁽⁴⁶⁾ Foreign tobacco companies have been quick to take advantage of the liberalized market. RJ Reynolds has bought a controlling share in the newly privatized Tanzania Tobacco Company and is planning a massive expansion of production. RJR hopes to use Tanzania as a base from which to challenge the dominance of British American Tobacco (BAT) in the East and Southern African market.

The cultivation of cotton, a highly erosive crop and one that uses large amounts of pesticides, has also increased under the adjustment program. So, too, has the production of so-called 'non-traditional' agricultural exports, such as roses and other horticultural crops, which have benefitted from special treatment by the government in terms of tax holidays, subsidized irrigation water and other incentives. In some areas this has led to severe groundwater depletion and pesticide pollution, as well as the dislocation of small farmers, who were to make way for larger-scale agriculture.

Although the land area in Tanzania is quite large (94.3 million hectares) given the country's population (around 30 million), less than ten percent of the land area is considered suitable for farming and only three percent is under crop cultivation. The 1992 Presidential Commission of Inquiry into Land Matters received considerable evidence that since the onset of the adjustment program there had been a considerable increase in the "[…] alienation and allocation of rural and village lands to outsiders – individuals, local and foreign companies, etc. involving thousands of acres of land" for ranching, export-crop production, hunting, tourism, and speculation. ⁽⁴⁷⁾ As small farmers get pushed onto more and more marginal lands, unsustainable farming practices and the resulting damage to the environment are bound to increase.

VI. Conclusion

As this study shows, Tanzania's adjustment program has hardly been a boon for the country's small farmers. While these farmers were not exactly prospering before the onset of the adjustment program, the program has done little to help them and in many instances has worsened their plight and made them more economically vulnerable. Rather than raising the living standards of the poor, it has led to a sharp decline in their income and consumption and exacerbated rural inequalities.

For subsistence producers this could have been expected, though the degree of misery is more than would be predicted by theory. But a substantial number of small farmers producing export crops have also seen their standard of living plummet. Facing declining world prices, these farmers have not benefitted from the export boom that was supposed to follow the implementation of adjustment measures. Rather, it is the large and relatively well-off farmers who have been able to respond to the incentives. The government is not blameless in this regard. Rather than defend the interests of the majority of the people, it has preferred to stand back and allow the IMF and World Bank free reign over the economy so that a few at the top can benefit.

The benefits of adjustment are not likely to trickle down to poor farmers in the near future. As their households fall deeper into poverty, their chances of lifting themselves out of it become dimmer and dimmer. Yet, despite the evidence that the majority of Tanzania's citizens have seen their standard of living plummet, the IMF seems hell-bent on continuing the current adjustment program. The PFP (*6) for 1995/96-1997/98 states that the focus of efforts will be on improving the agricultural extension system and improving "marketing efficiency" rather than fairness. No mention is made of keeping the price of inputs down or providing at least a floor price for food producers. As far as credit availability is concerned, the PFP mentions that improvements in the rural credit system will be "important" in the long-term, but does not specify what measures will be taken to address what is a critical situation. As for poverty, it will be reduced by implementing "growth-oriented" policies along with the financing of "basic social services and social safety nets" .⁽⁴⁸⁾ The growing inequality, a direct result of the adjustment program, is not addressed. Nor is there any mention of conservation or the sustainable use of natural resources. Rather, an 'export-at-all-cost' strategy is outlined, ignoring the downward trend in commodity prices.

Meanwhile, the country has become more and more dependent on foreign aid at a time when aid budgets in the industrialized countries are diminishing. According to the World Bank, recent aid levels are "in excess of absorptive capacity." ⁽⁴⁹⁾ Foreign assistance as a percentage of GDP rose from seven percent in 1985 to 61 percent in 1992 .⁽⁵⁰⁾ In 1993, aid accounted for two-thirds of imports, 40 percent of recurrent budget expenditures and 60 percent of the development budget. ⁽⁵¹⁾

Largely because of glowing reports by the IMF and World Bank, Tanzania came to be seen as a model adjuster on an otherwise troubled continent. "This involved talking the achievements up and the problems down," says a report prepared for Denmark's Ministry of Foreign Affairs. The distortion of the Tanzanian situation has been a serious obstacle to the country's long-term economic reform and recovery. "By 1993-95," says the report, "the directionless, enhanced dependency and corruption of the new system was becoming increasingly hard for donors to ignore – except for the IFIs, which had invested too much prestige in Tanzania and its success for this to be admissible." ⁽⁵²⁾ Corruption has increased dramatically under the adjustment program, as a "loosely-structured but clearly identifiable group of civil servants, politicians and private importers" has reaped super profits from the new economic system. ⁽⁵³⁾

Another study commissioned by the Tanzanian Ministry of Finance and the Danish Ministry of Foreign Affairs to investigate the relationship between Tanzania and its major donors noted the widespread perception among donors and the general public that "[…] the national leadership does not have a coherent development programme of its own, about which it is enthusiastic or even passionate, but is simply responding to proposals from aid donors, the World Bank and the IMF." ⁽⁵⁴⁾ The report noted that the "[…] previous vision of Nyerere's socialism has not evidently been replaced by any equivalent widely-shared national aspiration. Rather, cynicism and the pursuit of personal gain seem to have spread in the public sector." ⁽⁵⁵⁾ The government "[…]appears to suffer from an 'aid dependence syndrome'," says the report, "which has created an attitude of mind which, over time, it comes to be expected that most initiatives will originate from the donors[…]" ⁽⁵⁶⁾

Despite the reality of the situation in Tanzania, the major donors have not questioned the IMF's economic approach and continue to let the Fund dominate the development agenda. The only path to growth left open by the IMF – the export track – is a limited one, given the long-term price trends for primary commodities and the eventual limits of natural resource-based growth. Tanzania desperately needs a respite from these policies and an opportunity to truly engage the public in a serious debate about the future direction of the country.

Footnotes

*1. Lack of credit to finance the purchase of inputs was identified as a major constraint to increasing production by 90 percent of the villages surveyed in the World Bank's Participatory Poverty Assessment. (World Bank, 1996, p. 86.)

*2. Previously, production in these areas had been limited by the high costs of transporting crops to Dar es Salaam. Gibbon and Raikes contend that in Ruvuma and Rukwa regions, where 90 and 70 percent, respectively, of peasant farmers used fertilizer, the market-determined price of maize would have been near zero and the price for fertilizers prohibitively expensive given the distance from Dar es Salaam and the poor state of roads.

*3. Msambichaka (1995) shows an average annual decline in the unit price between 1986 and 1993 for coffee (16%), tea (3.4 percent) and cashew nuts (1.3 percent), with increases for cotton (7.4 percent), sisal (11.1 percent) and tobacco (0.9 percent).

*4. In 1980 the minimum daily wage could buy approximately 13 kgs. of maize – in 1992 it could buy just 3 kgs. The September 1996 Bank of Tanzania monthly economic review showed food prices rising 16.5 percent over the previous twelve months despite reports of good harvests across the country. Analysts attribute the price rise to the 20 percent increase in transport costs over the same period (Mshana, p. 5).

*5. Even if they can find cheaper substitutes this can often negatively affect household welfare, when for instance, cheaper, less nutritious foods are consumed.

*6. The government's Inter-Ministerial Technical Committee is charged with the responsibility of "negotiating" PFPs and of reviewing the substance and timing of the policy reforms included in these agreements. How equal these negotiations are is another matter. A group of independent advisers commissioned by Tanzania's Ministry of Finance and the Danish Ministry of Foreign Affairs recount that the original draft of the 1994 PFP was drawn up in Washington, leading to a situation in which the Government found itself "[…] negotiating amendments to a document prepared by others." (Report, p. 12).

Endnotes

1. Moshi, p. 7.

2. IMF Survey, 1987.

3. The East African, 14-20 October 1996.

4. The East African, 4-10 November 1996.

5. World Bank (1996), p. 66.

6. Bagachwa, et. al. p. 88.

7. Bagachwa et. al. p. 90.

8. Bagachwa et. al. p. 7.

9. Gibbon and Raikes, p. 46.

10. World Bank (1994a), p. 407.

11. World Bank (1994a), p. 408.

12. World Bank (1994c), p. 94.

13. IMF (1995), p. 9.

14. IMF (1995a), p. 5.

15. World Bank (1996), p. 7.

16. World Bank (1994a), p. 399.

17. World Bank (1994c), p. 5.

18. World Bank (1996), p. 14.

19. World Bank (1996), p. 21.

20. International Monetary Fund (1998), p. 6.

21. World Bank (1994c), p. 122.

22. The East African, 11-17 November 1996.

23. World Bank (1996), p. 15.

24. World Bank (1994d), p. 43.

25. Gibbon and Raikes, pp. 51-52.

26. IMF (1995), p.11.

27. World Bank (1996), p. 65.

28. World Bank (1994c), p. 103.

29. IMF (1995a), p. 18.

30. World Bank (1994d), p. 31.

31. World Bank (1994d), p. 33.

32. Lugalla, quoted in World Bank (1994d), p. 35.

33. World Bank (1994d), p. 34-5.

34. World Bank (1994d), p. 31.

35. World Bank (1994a), p. 360.

36. World Bank (1994c), p. 82.

37. The East African, November 4-10, 1996.

38. World Bank (1996), p. 74+94.

39. World Bank (1994a), p. 410.

40. World Bank (1996), p. 71.

41. Bagachwa et. al., p. 3.

42. Bagachwa et. al., p. 96.

43. Bagachwa et.al., p. 6.

44. Bagachwa et. al., p. 120.

45. Bagachwa et. al., p. 33.

46. Bagachwa et. al., p. 60.

47. URT, p. 22.

48. IMF (1995), pp. 11-12.

49. World Bank (1995), p. 4.

50. Bagachwa et. al., p. 152.

51. Bagachwa et. al., p. 152.

52. Gibbon and Raikes, p. 15.

53. Gibbon and Raikes, p. 16.

54. Report, p. 26.

55. Report, p. 8.

56. Report, p. 17.

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