a tripartite report - Unctad
a tripartite report - Unctad
a tripartite report - Unctad
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36 VOLUNTARY PEER REVIEW OF CLP: A TRIPARTITE REPORT ON THE UNITED REPUBLIC OF TANZANIA – ZAMBIA – ZIMBABWE<br />
<br />
mobilize adequate resources due to Government<br />
intervention and controls in monetary policy<br />
including exchange and interest rate controls;<br />
<br />
<br />
system and the collapse of the credit system;<br />
Decline of private sector activity and Foreign Direct<br />
Investment (FDI) due to the nationalization of<br />
foreign and domestic investments and assets; and<br />
Transformation of the cooperative movement<br />
<br />
and crop authorities serving as single agricultural<br />
marketing channels dependent on public<br />
subsidies.<br />
It was inevitable that such an economic system<br />
was heading for a collapse. Most of the industries<br />
that were established from the late 1970s were<br />
eventually run down and a process of industrial<br />
re-organization and privatization commenced.<br />
Since the mid-1980s, the Government undertook<br />
economic liberalization measures in line with<br />
global economic changes. The main objective was<br />
to improve economic performance by providing<br />
sound macroeconomic policies and adjustment<br />
<br />
domestic productivity and consumer welfare 19 .<br />
The formal introduction of the Economic Reform<br />
Programme (ERP) in 1986 facilitated the extension<br />
of the liberalization initiative to include widespread<br />
price decontrol, and the removal of import restrictions.<br />
The ERP introduced a series of measures designed<br />
to establish a market economy based on free<br />
trade through gradual introduction of complementary<br />
policies that facilitate effective implementation<br />
of trade policies. The set of complementary policies<br />
which were put in place since then included liberalization<br />
of agricultural marketing system including<br />
the re-introduction of the cooperative movement;<br />
restructuring and divestiture of State-owned enterprises<br />
in the manufacturing, services and trade<br />
sectors; and public sector reforms to facilitate more<br />
<br />
and the establishment of an enabling business environment<br />
through legal and regulatory reforms.<br />
As part of the SAPs, a privatization and commercialization<br />
programme was embarked on, which included<br />
a competition nomenclature. In 1994, the United Re-<br />
<br />
Fair Trade Practices Act and set up a department within<br />
the Ministry of Trade to oversee its implementation. In<br />
1996, the country proceeded to review its economic<br />
course and formulated the “Sustainable Industrial Development<br />
Policy 1996–2020” (SIDP). In the SIDP, the<br />
Government of the United Republic of Tanzania (URT)<br />
recognized the role of the private sector as the principal<br />
vehicle in carrying out direct investments in industry.<br />
To facilitate and consolidate this position, the<br />
Government promised to undertake the following20 :<br />
(i) Make enabling amendments in all major<br />
policies, Acts of Law and legislations whose<br />
provisions discriminate or tend to discriminate<br />
against private sector investors;<br />
(ii) Provide a suitable environment for promotion<br />
of private sector investments, ensuring fair<br />
trade practices and competition as well as<br />
(iii) Develop social and economic infrastructure,<br />
including industrial support institutions.<br />
The SIDP rightly underscored that under the economic<br />
reform measures, use of market forces had<br />
replaced the use of central-government-regulated<br />
economic management regime. Measures were<br />
taken to iron out distortions inhibiting the smooth<br />
functioning of the market forces, including price<br />
decontrol, liberalization of marketing and procurement.<br />
The Government further undertook to consolidate<br />
functioning of the market mechanism including<br />
full implementation of the 1994 Fair Trade<br />
Practices Act 21 (which was the forerunner to the Fair<br />
Competition Act of 2003). The Government also<br />
promised to adopt a new trade policy that was to<br />
inter alia, take into account fair trade practices.<br />
edged<br />
comprehensive National Trade Policy of<br />
<br />
largely sought to place the trade regime, comprising<br />
of foreign and internal trade for goods and<br />
services at levels from wholesale to retail, under<br />
public sector control and management. The successful<br />
implementation of the National Trade Policy<br />
was understood to depend on 14 fundamental<br />
premises and challenges that served as prerequisites<br />
towards achieving the objectives and the vision<br />
of trade policy that the Government had to<br />
focus on. They were indispensable factors for the<br />
successful implementation of trade policies. The<br />
22 :