cases from tanzania - Sustainet

Sustainable agriculture: A pathway out of poverty for East Africa’s rural poor
Kenya’s economy performed much better before the reforms than afterwards. Through intensive
public investment immediately after independence, the country enjoyed rapid economic
growth from 1963 to 1973: the GDP grew at an annual average of 6.6%. But the economy
has since stagnated or declined, reaching a nadir in the early 1990s. This is the case not only
for agriculture: growth in other sectors has also wilted. Agricultural growth in the 1980s was
3.3%; in the 1990s it was only 1.2%; in the same period industrial growth fell from 3.9% to
1.5% and services dropped from 4.9% to 2.9%.
During the 1990s, the Tanzanian government paid only modest attention to sectoral policies,
while concentrating on macro-level policies to provide an impetus towards a free market
economy. A study by Ponte (2001) on policy reforms, market failure and input use in Tanzania
found that poor infrastructure and dispersed settlements have limited the ability of the
private sector to cover the ground left by the state’s withdrawal, and private traders have not
shown great interest in operating in remote areas.
The poor performance of Kenya’s macro-economy and agricultural sector may be due to
missing reform in complementary policy areas and in the sequencing of reforms. For example,
there is no institutional framework for the efficient operation of markets, and no system of
rights and obligations to knit society together and respond to citizen needs. Private entrepreneurs
lack the managerial skills, financial capacity and physical infrastructure to take over
the activities of cooperatives and boards. The government was relatively slow to undertake
reforms in governance (to eliminate corruption or mismanagement) and institutions.
Both structural and policy factors contribute to the generally poor performance of the agricultural
sector and the rapid rise in poverty and food insecurity. Development is the outcome
of economic, political and social processes that interact and frequently reinforce each other;
market liberalization alone cannot be a remedy. Reduced economic activities in Kenya are
a result of institutional failure and lack of adequate infrastructure, as well as mismanagement
and adverse weather conditions. Additionally, the lack of good governance has helped
perpetuate poverty in both countries.
Policy reform is faced with a number of problems: quality assurance, the high price of
inputs, inattention to smallholders, underdeveloped supply channels and poorly functioning
extension services. Kenyan small-scale farmers find it hard to access credit, the bulk of
which goes to large-scale farmers. The smaller-scale farmers, and women farmers, are at a
distinct disadvantage, since most have no land certificate or other source of income, which
are required to get a loan. Increased food imports have displaced farmers from the domestic
market. With no other source of income, rural people cannot buy the imported food, so
stay hungry and malnourished.
Why have the reforms not produced the expected improvements? Over-reliance on the market
has undermined the role of government interventions in a complex situation where many
factors limit agricultural productivity, competitiveness and growth. Institutional weakness
and inappropriate policy formulations seem to be the key constraints to getting agriculture
moving. In that, Kenya and Tanzania are not so different from most other countries in sub-
Saharan Africa.
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