investment potential and opportunities in agriculture - Ministry Of ...

4.0 IMPORTANCE OF AGRICULTURE
Agriculture is the mainstay of the Tanzanian economy. It contributes more than 25
percent of GDP and 30 per cent of export earnings. Agriculture has been experiencing
a dismal growth rate over time. However, there has been an overall increase of five
year moving average agricultural GDP growth rates of about 3.3 percent (1991 –
2000) to 5 percent in 2001 to 2006. The agricultural sector provides employment to
about 75 percent of the total labour force out of which 56 percent are women.
The crop sub-sector contributes about 35 percent of GDP and grows at 3.8 percent
annually. Food crop production has grown at a rate of about 2.8 percent accounting
for about 65 percent of agricultural GDP while cash crops account for only about
10 percent. Maize is the most important food crop accounting for over 20 percent
of total agricultural GDP. Agricultural export crops have been growing at about 6
percent while food crops have been growing at 4 percent. Food and cash crops
account for about 70 percent of rural incomes.
5.0 AGRICULTURAL POLICY FRAMEWORK
Since the mid-eighties, the Tanzania economy has undergone gradual fundamental
transformation that has redefined the role of government and the private sector.
Under the new environment most of the production, processing and marketing
functions have been assigned to the private sector while the government has retained
regulatory and public support functions. These macro changes have and continue
to have profound impact on the agricultural sector in which, already agricultural
input and output prices have been decontrolled, subsidies have been removed, and
monopolies of cooperative and marketing boards have been eliminated.
At institutional level, the agriculture sector lead ministries ( Ministry of Agriculture
Food Security and Cooperatives, Ministry of Livestock Development and Fisheries,
Ministry of Industry Trade and Marketing and Prime Minister’s Office Regional
Administration and Local Government) have assumed new missions in which
they see themselves as essentially performing public sector support functions,
which among others include research, extension and training, policy formulation,
information services, regulatory functions, protection of environment and provision
of enabling environment for private sector participation in the agricultural production,
processing and marketing.
The privatization of commercial functions is supported by programme of parastatal
divesture, which aims at enhancing investment resources in agricultural enterprises,
thereby stimulating productivity and production and ensuring financial sustainability
of the enterprises.
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