Last month in Dar es Salaam, the African Development Bank (AfDB) Tanzania Country Office invited members of government, the local aid community, bi- and multilateral organisations, private agribusinesses, civil society, think tanks and journalists, to debate rising food prices and growth prospects in Tanzania. The event, co-organised by the OECD Development Centre with financial support from the Italian government, hinged around two recent reports: Business for Development 2008 (B4D) and the annual African Economic Outlook 2008 (AEO). We asked Sipho Moyo, AfDB Tanzania Resident Representative, to expand on some of the issues raised.

 

Which of the reports’ findings were most relevant to Tanzania?

 

The launch of the two reports was timely and pertinent given what is happening in the global economy, specifically the challenges of the food crisis and ever rising oil prices and how these affect African countries. The most relevant findings to Tanzania— and elsewhere in Africa— are those relating to measures that would improve the functioning of food markets. Commercial agriculture in Tanzania is constrained by poor logistics including poor infrastructure, lack of market information/or information asymmetries, and unpredictable government interventions, including those supported by development partners. As noted in the B4D case study of Tanzania, food surplus in one region could more easily find its way into neighbouring countries – as opposed to neighbouring regions— owing primarily to poor infrastructure.

 

How can Tanzania specifically, and African countries in general, stave off the negative effects of the crisis and capitalize on the opportunities it presents?

 

Part of the solution lies in government initiatives geared at improving logistics for commercial agriculture. Development partners need to scale up support to government programs in agricultural development with a focus on improved market access for food products. Much of this is already happening with the sector basket funding but another key area where donors can add value is assisting African governments to develop policies that promote private sector investment in agriculture, particularly in agro-processing and irrigation. But given the current baseline, an immediate measure that Tanzania may have to consider is subsidies for agro-inputs and investments in irrigation schemes.

 

The AEO provides independent analysis and data meant to promote open and informed public policy debate. What has been the added-value of this type of analysis in Tanzania and the region?

 

The added value of the AEO is in the breadth and depth of relevant policy analysis across the spectrum of development areas particularly macro economic and fiscal policies. And of course using a uniform analytical model of economic development across African countries is valuable for purposes of comparison. The approach of drawing findings from country studies and the use of in-country expertise also makes the report’s findings more informed and pertinent for policy decisions. 

 

The focus on the quality of growth was excellent; however a more detailed analysis of strategic growth drivers would have been useful especially for Tanzania where a lot of attention is focused on the need for improved fiscal performance. The mining sector is a case in point. It accounts for 47.8% of Tanzania’s export earnings and expected to reach 50% in 2008 with one of the highest sectoral growth rates (around 16 per cent annually). In spite of this, the contribution of mining to government revenue is less than significant. I think policy makers would like to see us shedding more light on this kind of topical discussion.

 

The AfDB works with many development institutions. What makes it’s collaboration with the Development Centre in producing the AEO valuable to the Bank and its constituents?

 

First, the OECD’s expertise in development policy analysis enables the Bank to proffer the right policy solutions to decision makers in its regional member countries, policies which are designed to stimulate growth and improve the living conditions of African people. Second, the findings and recommendations of the AEO are critical in informing the Bank’s capacity building programs in policy analysis, and in orienting its interventions with African member countries. Last, but by no means less significant, our collaboration paves the way for OECD member countries to share a common understanding of the constraints facing African countries in meeting Millennium Development Goals and hopefully further informs OECD countries to better improve their development initiatives in Africa.