Tanzania: Dar Economy Nicks Milestone

... ..AfDB report backs middle-income status

TANZANIA has registered yet another economic milestone, as incomes of rural producers and

traders have increased by three folds, according to African Development Bank (AfDB) latest report.

This follows successful implementation of the project to enhance market infrastructure, value addition and rural finance (MIVARF) undertaken in the country.

With 56.8million US dollars in funding from the AfDB, the programme was undertaken in 32 districts with a population of 6.1 million in 1.2 million households between 2012 and 2017.

According to the report released yesterday by the project team, Tanzania produced highly satisfactory results.

The report comes as a backup to the World Bank (WB), recent decision declaring Tanzania as a lower middle income country, five years ahead of the country's 2025 Development Vision.

The lower middle-income countries (MICs) are defined as economies with a Gross National Income (GNI), per capita between 1,036 US dollars and 4,045 US dollars.

Elaborating on the factors that steered the country towards middle income, Government Chief Spokesperson, Dr Hassan Abasi cited several development projects that earned individuals more income through direct and indirect employment or by selling goods and services during the implementation of the projects.

In its report released yesterday in Abidjan, Ivory Coast, the AfDB confirmed that its MIVARF project, which is aimed at poverty reduction and economic growth, through enhancing rural incomes and food security, successfully increased the incomes of rural producers and traders by threefold.

Approximately 78 per cent of beneficiaries reported improved incomes, rising from an average of 41 US dollars in 2012 to the 133 US dollars in 2017, according to the report.

"This increase is attributable to the sale of value-added products, improved access to markets, increased productivity, the use of improved techniques (including the System of Rice Intensification and the use of fertilizer and improved seed) and enhanced capacity to negotiate better prices," explained project team leader Salum Ramadhan.

Small producers and traders also gained greater access to agricultural markets, which cut their post-harvest losses of staple crops.

One beneficiary, the Meru Dairy Company, recorded a nearly-85 percent spike in production: Establishment of a cold room boosted the company's milk-production capacity from 400 to 2200 litres.

Transportation costs on all refurbished roads dropped by an average of 20 percent to 50 percent. For example, the cost of transporting a bag of onions on the renovated road to Mang'ola market in Karatu fell from US$1.30 to US $0.22.

Transport times for produce harvested have fallen from an average of three-and-a-half hours to 56 minutes.

Downstream, the use of the programme's warehouses has led to a sharp decline in post-harvest losses, from 57 percent to 15 percent overall.

"Despite challenges in terms of coverage, the programme has worked well thanks to the efficiency of communication with the district and regional liaison officers, and to the good relationships established with district and regional political and administrative structures," according to the project completion report.

The successful implementation of the project is thought to have helped rural poverty reduction and economic growth, by improving incomes and food security.

The project also complimented the work of government agencies by boosting access to markets and increasing the quantity of value-added agricultural products.