Monday, February 27, 2017

A Re(Turn) to the Arusha Declaration?

Wednesday, February 22, 2017

Barua kwa Mpenzi Wangu Azimio

Wednesday, February 15, 2017

Give a Book, Take a Book at Soma Book Cafe

Mhadhara wa Maadhimisho wa Miaka 50 ya Azimio

New Book On the Relevance of Walter Rodney

Saturday, February 11, 2017

Public Debt and Economic Stability in Tanzania

Public Debt and Economic Stability in Tanzania 

Kochecha Heriel

The Tanzanian economy is continuing to prosper with an annual Gross Domestic Product (GDP) averaging 7% as per World Bank and IMF reports. The performance and increasing trends of GDP is attributed, to a great extent, to the buoyant performance of construction, trade, agriculture, services and transport sectors. Its projection is promising in contrast to the real picture behind the scene. The distribution of the national cake is still unequal in urban and rural populations. The World Bank overview report shows that, about 12 million Tanzanians are still living in poverty.

In fact, the same development challenges that faced Tanzania since 1961 are still debates and topics of the day. Mwalimu J.K Nyerere (the founding father of the nation) declared war against poverty, diseases, and ignorance. Worse enough, fifty years down the line, with five presidential terms, the country and its administrative system is still swimming in the same ocean with increased tragedies and development challenges such as fraud, rampant corruption, infrastructural bottlenecks, unemployment, illiteracy, diseases, poverty and power inaccessibility. There has been numerous development programs, slogans and jargons with little or any profound achievements, especially when one looks at value for money.
The national debt burden and the gap between the “haves” and the “have-nots” are widening. In April 2000, the IMF and the World Bank classified Tanzania as a heavily indebted country and thus eligible for enhanced Highly Indebted Poor Countries (HIPC) debt relief assistance. There has never been concrete efforts to reduce the increasing debt burden despite the IMF and the World Bank's regular alerts and reports. What has been persistent, and regularly practiced by the government in relation to this, is increasing the share of government expenditure to GDP ratio in a bid to reduce the savings-investment gap and minimize the Balance of Payments (BOP) problems.

According to the World Economic Forum (WEF), in its global competitiveness report (2015-2016), in which Tanzania was ranked 120th out of 140 countries, there were a number problems which require immediate attention: quality of overall infrastructure (115th out of 140 countries);  irregular payments and bribes (121st out of 140 countries); quality of electricity supply (120th out of 140 countries). All these hurdles, including others attributes, have had far reaching negative effects, both direct and indirect, in the economy. These include deterring investments, both local and foreign, reduced local production, which in turn results into increased importation and Balance of Payment (BOP) problems. 
The overall situation has slightly improved over the year with the WEF's global competitive report for 2016-2017 ranking Tanzania as 116th out of 138 countries. In terms of the macroeconomic environment, the two successive WEF reports indicate that the country has moved from being number 111 out of 140 countries to 106 out of the 138 countries in terms of the annual percentage change in inflation. However, its ranks for country's crediting rating has shifted from 103 out of 140 countries to 109 out of 139 countries. Its government budget balance as a % of GDP moved from a value of minus 3.9 to minus 3.3, corresponding to a shift in ranking from being number 90 out of 140 countries to number 83 out of 138 countries. The WEF reports show its ranks for Tanzania's general government debt as a % GDP shifted from number 43 out of 140 to number 54 out 138.

In a similar vein, the IMF report for 2016 indicate that Tanzania’s total public sector debt (internal and external) gradually increased from 20% of GDP in 2007/2008 to an estimated 37.5% of GDP in 2015/2016. Worse enough most of borrowings were from commercial sources due to decrease in aid and concessional loans from development partners and other multilateral agencies.

In the modern world, no country has yet moved from being underdeveloped to being developed or industrialized without borrowing. Therefore, the problem is not borrowing or the size of borrowing but how do we use the credit towards economic growth and development without falling into the trap of defaulting or overpaying. Specifically, to our country (Tanzania), statistics shows that, while the total government expenditure demonstrated an increase of 6.2% from 17.7% in the financial year 2008/9 to 23.9% in 2015/16, the domestic revenue collection grew only by 1.9% from 12.2% to 14.1% in the 2008/9 and 2015/16 respectively. This calls for external borrowing in order to fill the expenditure gap. 

From an analytical point of view, if all is said and well understood, we must not concentrate on faults and criticism only but also on the remedies that are vital for progress. The question is; should Tanzania stop borrowing or what should be done with respect to the present economic situations facing the country. The relatively new political regime under President John Magufuli shows a promising future especially in terms of accountability, governance and investment in development projects; however, it is too early to judge with respect to the challenges lying ahead.
President Magufuli’s fifth phase government ought to ensure, especially in regard to debt sustainability,  that the country channels most of its borrowings to investments projects rather than recurrent expenditures as it used to be in earlier presidential reigns. Efforts must be put in place to ensure that all the investment projects realize value for money as per the specified objectives and timeframe. For instance, a big stake of the budget for the government’s five-year development plan (FYDP-II), with its potential investments on hydropower plants, roads, a standard gauge railway, the Dar es Salaam Port, the water and transportation systems should be sourced through Public Private Partnership (PPP) and, where necessary, through concessional loans. This will reduce the government's borrowing and risk to debt sustainability. 

In line with this, the government should use its diplomatic ties and international relations to lobby for concessional loans to fund its development projects from agencies such as the African Development Bank (ADB), the Export-Import (Exim) Bank of China, India, Japan Bank for International Cooperation (JBIC) and the likes due to their generosity, low interest rates and long grace period compared to market loans from conventional International Financial Institutions (IFIs).

Tanzania still lacks adequate technological expertise and personnel in almost all domains. This has been attributed to the use of borrowed money (forex) for purchase of equipment and paying for the technical services rendered by international experts, hence the exposure to exchange rate fluctuations and persistent depreciation of the Tanzanian shilling against foreign currencies especially the Unites States of America's Dollar (USD). Therefore, the government should focus on borrowing from countries which do not use USD such as Japan, China, Germany and the UK hence reducing exchange rate volatility taking into account that, until June, 2015, the total external debt was dominated by USD at 54% while Euro was only at 18%.
On the other hand, there should be a separate agency with full autonomy entitled, by law, to audit all the government borrowings, payment plans and produce reports (both Swahili and English) in a very transparent manner. To make things more transparent, the reports should be discussed and debated in the parliament. This will ensure optimal and effective use of government borrowings hence eradicating the occurrence of embezzlement of funds and related financial misconducts like stealing of $133 million (Sh279 billion) from the External Payment Arrears Account (EPA) from the Bank of Tanzania (BOT) in 2005/06.

Contracts transparency is an issue of concern and should be addressed immediately. All contracts relating to extractive industry such as oil, gas and mining should be disclosed and well known to the public. Those who have experience with Participatory Rural Appraisal (PRA) techniques would concur with me that, whether educated or not, citizens are researchers. They are good in investigating and seeking informatio. As such, through contract disclosure, they will be allowed to monitor contracts in areas such as environmental compliance where they may be better placed than the government. This would reduce or eliminate the resource curse problem facing other countries like Nigeria, Sudan and Somalia.

The backbone of Tanzania’s economy with more than the estimated 50 million people is based on agriculture. This suggests that the government has to undetake several reforms to free the agricultural sector from all technical and business related shackles. Among the key areas for agricultural reforms include increase in agricultural subsidy, price stabilization, adoption and sustaining of agricultural based irrigation, promoting agricultural extension, agricultural mechanization and more efficient intermediation of savings into capital formation for agriculture and its related activities.
Investment in the industrial sector is vital and inevitable. Tanzania is experiencing inflation, loss of currency value against other currencies especially USD and BOP problems caused by importation of a litany of goods which can even be produced locally. It is only through revamping the old and dead industries and increasing investment into other new industries that we can do so. Such investment in the industrial sector will have far reaching direct and indirect impacts to the economy and the community at large through employment creation and increased revenues. The BOP problem will also be addressed through increased exportation and reduced importation. The production, supply and distribution of reliable electricity requires our sustained attention. Electrical power is the engine and heart for increased production in all sectors of the economy, particularly in industries, mining and agriculture. 

Despite the fact that, IMF Debt Sustainability's Analysis (2016) and the Ministry of Finance's Medium Term Debt Management Strategy (2015), underscore that Tanzania’s risk of debt distress  remains low and none of them have breached the respective threshold as per their indicators, for a developing country like ours, with rampant corruption, an underperforming export sector, Balance of Payment (BOP) problems and inflated currency, borrowing needs to be well scrutinized and allocated. Therefore, the government should remain firm on implementing prudent fiscal policy, opt for appropriate financing mix coupled with strengthened debt management capacity and continuous financial and public reforms.

Friday, February 10, 2017

Mhadhara na Simulizi za Azimio Kavazini

Thursday, February 9, 2017

Children's Story Time at Soma Book Cafe

Book Tasting at Soma Book Cafe

Don’t stop blogging, your voice is needed

"I hope you don’t mind me writing you a public letter like this. But it feels like the most appropriate way of saying what I want to say" -

Wednesday, February 8, 2017

Against 'A Re(turn) to Self-Censorship'

Against Silence: Response to 'A Re(turn) to Self-Censorship'

Charles Makakala Jr.

Did I seriously hear closing shop? I am not sure which words to use, or which philosopher to quote to persuade you not to do that. Watching our mouths, we will, but silence - that is the last thing that should happen now.
While reading your article what went through my mind were the words of Martin Luther King Jr. in his 'Letter From Birmingham Jail'. Kindly review the letter to remind yourself of its contents, much of it is relevant to our situation today. 

''Since we so diligently urge people to obey the Supreme Court's decision of 1954 outlawing segregation in the public schools, at first glance it may seem rather paradoxical for us consciously to break laws. One may well ask: "How can you advocate breaking some laws and obeying others?" The answer lies in the fact that there are two types of laws: just and unjust. I would be the first to advocate obeying just laws. One has not only a legal but a moral responsibility to obey just laws. Conversely, one has a moral responsibility to disobey unjust laws. I would agree with St. Augustine that "an unjust law is no law at all...I hope you are able to see the distinction I am trying to point out. In no sense do I advocate evading or defying the law, as would the rabid segregationist. That would lead to anarchy. One who breaks an unjust law must do so openly, lovingly, and with a willingness to accept the penalty. I submit that an individual who breaks a law that conscience tells him is unjust, and who willingly accepts the penalty of imprisonment in order to arouse the conscience of the community over its injustice, is in reality expressing the highest respect for law.'' 

I know of a couple of examples, which are not yet in the public sphere, that show how low we have already sunk as a nation. Our biggest problem today, I submit, is not the fact that some people are being taken to jail for expressing views contrary to the government's wishes: our biggest problem is that THERE ARE VERY FEW OF THOSE!
Looking at history, there are just so many people the oppressors can imprison, or even worse, but the society will at one point awaken to the injustice that is being committed. And that cannot happen if rational people remain silent. 

Again, with the view of history in mind, the oppressors' power and clout of invincibility is always a house of cards. I usually look back in awe at the fall of people like Mobutu, Gaddafi, Saddam, Mubarak, et al. - they were just men of flesh and blood. It all comes down at some point. 
Let me finish by quoting from 'First They Came' poem. According to Wikipedia: "First they came ..." is a statement and poem written by Pastor Martin Niemöller (1892–1984) about the cowardice of German intellectuals following the Nazis' rise to power and subsequent purging of their chosen targets, group after group. 

"First they came for the Socialists, and I did not speak out—
Because I was not a Socialist.
Then they came for the Trade Unionists, and I did not speak out—
Because I was not a Trade Unionist.
Then they came for the Jews, and I did not speak out—
Because I was not a Jew.
Then they came for me—and there was no one left to speak for me.”
The fact is - there is no better time to speak...

I cannot say that I am a 'fan' of Udadisi Blog - but whenever you post something here I go and read the post. It is one of those intelligent and thoughtful blogs, and there are very few of those around. I can't say that I will greatly miss the blog, I tend to be too distracted by ideas and conceptual issues that happen all over the globe. But it will be very unfortunate if Udadisi closes shop under the current pretexts. That will not only set a terrible precedent but will also end one of the voices that I believe is positive, constructive and well - I can't resist taking a cheap jibe - generally progressive!
Keep the oil burning. Let the light shine. Darkness shall not prevail.

A Re(turn) to Self-Censorship

A Re(turn) to Self-Censorship

Chambi Chachage

This blogger is about to close up shop. After ten years of exercising his constitutional right to freedom of expression by blogging, he no longer feels safe. Self-censorship, it seems, is now the safer option.

Last year he received a clarifying email from a brave compatriot. "I have no problem" with circulating my comments, the mailer said. "However", s/he cautioned, "it may bring problems in the future with the enforcement of the Cybercrimes Act" of 2015 in Tanzania.

If such a courageous person could be that worried as to practice self-censorship, what would a coward do? As Shakespeare reminds us, "cowards die many times before their deaths". After all, within a space of one year more than ten people — including the co-founder of Jamii Forums  have been charged under the Cybercrimes Act.
Moreover, on February 5, 2017, the Minister of Information  declared that the Media Services Act became operational as of December 31, 2016. Despite the opposition from journalists and activists, the Parliament passed its Bill and the President promised, prior to its passing, that he will promptly assent to it. Among the reservations that the critics had is that of its definition of 'sedition'. 

Article 52(1)(a) of the Act partly defines a "seditious intent" as "an intention to bring hatred or contempt or to excite disaffection against the lawful authority of the Government of the United Republic." In subsection (d), the definition includes the raising of “discontent or disaffection amongst people or section of people."
“In determining whether the intention for which an act was done, any word spoken or any document published, was or was not seditious”, Article 52(3) stipulates, “every person shall be deemed to intend the consequences which would naturally follow from his conduct at the time and in the circumstances in which he conduct himself.” Then Article 53(1) defines seditious offences in terms of:

"Any person who (a) does or attempts to do or makes any preparation to do, or conspires with any person to do, any act or omission with a seditious intention; (b) utters any words with a seditious intention; (c) publishes, sells, offers for sale, distributes or reproduces any seditious publication; or (d) imports any seditious publication, unless that person has no reason to believe that it is seditious, commits an offence and shall be liable upon conviction, in the case of the first offender to a fine not less than five million shillings and not exceeding ten million shillings or to imprisonment for a term of not less than three years but not exceeding five years or both, and for a subsequent offence, to a fine of not less than seven million shillings and not exceeding twenty million shillings or to imprisonment for a term of not less than five year but not exceeding ten years or to both."

For a non-profit-making blog that is an enormous amount. More significantly, suspects are left to the (discretionary) mercy of state apparatuses when it comes to determining whether they have/had a "seditious intent" and/or committed "seditious offences." Hence the cautious would play safe by self-censorship lest they are charged.
With such uncertainty it is not surprising to read this recent tweet from the leader of one of the opposition parties: "And today it's my turn I've been informed by parliamentary security personnel that police will arrest me for sedition details are not known." By his turn, he means following the arrest of the chief whip of the official opposition camp in the Parliament who was arrested a day before.

Of course, one can hardly fault this leader of paranoia or publicity stunts for courting arrest given that on February 6, 2017, he publicly shared this personal encounter with a state apparatus: "I myself have been questioned by police twice and write this article after escaping an arrest on dubious sedition charges".
For some of us, in times like these, all we can do is to hearken to what a 'mama cartoon' told her dear baby: "Watch your mouth..."

"A change is gonna come", sung Cooke. Watch this space. So long.

Thursday, February 2, 2017

CFP: Conference on Capitalism in the Countryside

Karibu kwenye ulingo wa kutafakari kuhusu tunapotoka,tulipo,tuendako na namna ambavyo tutafika huko tuendako/Welcome to a platform for reflecting on where we are coming from, where we are, where we are going and how we will get there

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