Regional Markets

Regional Markets for Local Development
costs, including seeds and labour costs. The price of agro-inputs has been increasing
annually by 10% on average for the past last decade. Combined with the steadily rising
energy prices, it has increased the fiscal pressure on farming households.
Innovation and sustainability
TAHA was instrumental in the introduction of various new technologies in good agricultural
practices, including irrigation, demonstration plots, small greenhouses, financial management
and a closed cold chain. Farmers were trained in the construction of small greenhouses
using locally available materials like branches, stones, wooden poles etc. In addition
to providing enhanced technological capacity, the trainings were very useful for promoting
a business-minded approach to improving production. They also serve to foster resourcefulness
based on the unique opportunities in the local context. Often due to stagnant economic
performance and reliance on old fashioned way of farming and doing business, smallholders
do not take advantage of easily available opportunities to improve their livelihoods.
Sustainability of the vegetable sector has been enhanced by public-private partnerships
at both local government and central government levels. For example, the District
Agricultural Officers were familiarised with the horticultural activities taking place in
their region, in order to increase their understanding of the importance of horticulture,
and to secure their support in allocating additional budgetary resources to this sector.
Persistent challenges
Despite the gains made in promoting pro-poor development through the horticultural
value chain, there are some issues that still need to be addressed, namely the high tax
rates, inadequate subsidies, non-inclusive government policymaking and the rising
energy prices. All horticultural produce is subject to a 3% tax. Horticultural exports are
exempt from paying VAT, but agricultural inputs are taxed at 17% VAT and are subject
to additional fees and chargers (e.g. by the Tanzania Bureau of Standards). These taxes
make input costs relatively high compared to neighbouring countries, which increases
producer costs and invariably also consumer prices. Even though the government does
provide subsidies for agro-inputs, they are not well-targeted as the horticultural sector
needs different, specialised inputs that are not included in the government’s scheme.
The drafting of agricultural policies does not always follow a transparent and inclusive
process. The main policy and decision-making bodies continue to formulate key legislation
and regulations without considering the opinions and needs of the actors in the
horticultural sector. The rising costs of energy, for example electricity and petrol, have
had a negative impact on the price of inputs as well as storage and processing costs.
Rising fuel prices in particular have increased living costs and exerted additional pressure
on the poorest segments of the population.
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