TOPIC 19: STRUCTURE OF TANZANIA ECONOMY ~ ECONOMICS FORM 6
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INTRODUCTION
The economic structure of Tanzania is the topic/ concept which explain and analyze economic aspects which form Tanzania economy and features of Tanzania economy.
The structure of Tanzania economy deal with analyzing economic sector which form Tanzania economy and an ownership system available in Tanzania basing on characteristics, contributions, problems and solutions to the problems facing economic components/ sector as the way of creating sound economic situation.
COMPONENTS/ PATTERNS OF TANZANIA ECONOMY
The structure of Tanzania economy divided into two main patterns/ components. These are
SECTORAL PATTERN
This is the pattern aspect of Tanzania economy which analyze economic sector in Tanzania in terms of contribution, problem and solutions of the problems facing economic sector. All economic sectors in Tanzania economy are divided grouped into three (3) sectors.
PRIMARY SECTOR
This is an economic sector which deals with production of goods from origin or sources. Most of primary sector deal with production of raw materials which may used for further production especially in industrial sector so as to get final goods and services, primary sector includes activities/ sectors such as agriculture, mining, fishing and considered as a main economic sector in Tanzania economy.
AGRICULTURAL SECTOR
This is an economic sector which deals with crop production (cultivation) and livestock keeping.
Agriculture sector is the main primary sector and considered as a leading Economic sector in Tanzania because it contribute large percent of gross national product (GNP) and provide employment opportunities to many people in Tanzania.
Agriculture plays a great role in development of other economic sector such as trading and manufacturing sector. Therefore agriculture is the backbone of Tanzania economy.
ECONOMIC ROLES/ IMPORTANCE OF AGRICULTURE SECTOR IN TANZANIA
PROBLEMS FACING AGRICULTURE SECTOR IN TANZANIA
The development of agricultural sector in Tanzania is limited/affected by the following problems;
GENERAL SOLUTIONS TO THE PROBLEMS FACING AGRICULTURE SECTOR IN TANZANIA
The following strategies may used to improve agriculture sector in Tanzania
SPECIAL STRATEGIES ADOPTED BY TANZANIA FOR IMPROVING AGRICULTURAL SECTOR
All strategies of improving agricultural sector adopted by Tanzania economy may grouped into two main approaches
i.) Improvement approach
ii) Transformation approach
IMPROVEMENT APPROACH
This is the strategies of improving small scale peasant/ production which deals with improving productivity in agricultural production. These strategies emphasize on small scale production which has high productivity done by using modern method of production rather than local method so as to improve land and labor productivity (efficiency) in order to produce more goods of higher quality. It emphasizes measures aimed at primarily at individual produces.
Basic ingredients/ methods/ objective/ strategies of an improvement approach in Tanzania are:
Basically improvement approach aimed at improving production efficiently and increase in supply. This strategies succeed in increase in employment by enough people to participate, encourage innovations, production cost increase production/ supply of quality and quantity etc.
TRANSFORMATION APPROACH
These are the strategies of improving agricultural sector which dial with changing from small scale to large scale production of both food and cash crop. This method deals with large scale mechanized agriculture.
Under transformation approach government emphasize the use of modern technique of production in order to improve productivity of factors of production.
Transformation approach emphasize on the following strategies /objective/ methods of production
Therefore: transformation approach aimed at production in large scale for domestic and international trade in order to get foreign scale increasing employment reducing deficit in the balance of payment increase government revenue and GNP and other benefits of large scale mechanized production
However it limited by the shortage / absence of sufficient capital, low development of technology, shortage of large portion of fertile land, lack of educated and trained farmers (unskilled) labor, shortage of market and price fluctuation.
FLUCTUATIONS OF PRICE OF AGRICULTURAL PRODUCTS IN TANZANIA
The economic analysis proved that there is no stability of price to agriculture products. These products experience rise and fall in price which much differ from other products such as industrial product. Therefore price of agricultural product fluctuates more than the price of industrial product.
FACTORS/ REASONS FOR LARGE FLUCTUATIONS OF PRICE OF AGRICULTURAL PRODUCTS
THE EFFECTS OF PRICE FLUCTUATIONS OF AGRICULTURAL PRODUCTS
The up and down / rise and fall of price of agriculture /product may have the following effect in an economy.
Agricultural sector and industrial sector should be developed simultaneously because development of one sector can be used as a catalyst for development of another sector. The following are the way agricultural sector may stimulate development of industrial sector.
Note: the explanation above May used/ provide a framework in explaining the way industrial sector facilitate agricultural development.
SECONDARY SECTOR/ INDUSTRIAL SECTOR
This is economic activities/ sector which deal with converting inputs into output, secondary sector deal with production of final goods and services from raw materials manifesting and construction activities are two main aspect which from industrial/ secondary sector.
Industrial sector mostly take raw materials from primary sector then modifying/ convert into final goods and services. Secondary / industrial sector contribute about / over 20% GDP (22.6%) and over 20% employment in Tanzania economy.
THE ROLES OF INDUSTRIAL SECTOR IN TANZANIA
PROBLEMS FACING INDUSTRIAL SECTOR IN TANZANIA ECONOMY
INDUSTRIAL DEVELOPMENT STRATEGIES IN TANZANIA
Since independence Tanzania government adopted two main strategies of improving industrial activities
THE IMPORT SUBSTITUTION INDUSTRIES STRATEGY
This was the policy adopted by Tanzania government which aimed at producing goods and services formerly imported from other countries. That means government decided to established domestic industries of producing goods or service which satisfy domestic human wants in order to reduce the deficit in the balance of payment made abroad so as to reduce deficit in the balance of payment . Import substation industry strategy started on 1961 to 1975 as industrial development strategy since independence
OBJECTIVES/ IMPORTANCE OF IMPORT SUBSTITUTION INDUSTRIES STRATEGY
DISADVANTAGES OF IMPORT SUBSTITUTION INDUSTRY STRAGETY
The import substitution industries have the following disadvantages in an economy.
DIFFICULTIES/ PROBLEMS IN IMPLEMENTING IMPORT SUBSTITUTION INDUSTRY STRATEGY
BASIC INDUSTRIALIZATION STRATEGY (1975-1995)
This was industries development strategy aimed at establishing and development industries which produce capital goods rather than final goods and services.
Basic industrialization strategy started in 1975 to 1975.In implementing this strategy Tanzania government established many industries such as Tanga Fertilizers Company, Wazo cement, making factor; Kilimanjaro machine tools, kibaha sub- scania car assembly UFI, ZZK- mbeya SPM- mogololo- iringa and other industries.
Basic industrialization strategy promote production of capital goods for further investment and industries development reduce deficit in the balance of payment, through reduction of importing capital goods, promote development of technology, reducing dependence on foreign capital and creating strong economic base, saving foreign currency reserve used for importing capital goods.
TERTIARY SECTOR
This is an economic sector which deals with service provision to other economic sector or people in an economy. This sector does not deal with physics production of goods but provide services which assist production, competition, exchange, distribution and consumption activities. Tertiary sector includes activities such as banking, insurance, communication, transport, warehouse and other aids to trades tertiary sector also called services sector.
THE ROLES/ IMPORTANCE OF TERTIARY SECTOR
OWNERSHIP PATTERN
This is the structure aspect of Tanzania economy based on system of ownership of major means of production in Tanzania economy. The system of ownership in Tanzania divided into three (3) main systems
PUBLIC OWNERSHIP
This refer to the system of ownership where by major means of production (resources) are collectively owned by government and major means and economic decisions made by government through central government authorities on behalf of society.
ADVANTAGES OF PUBLIC OWNERSHIP
DISADVANTAGES OF PUBLIC OWNERSHIP
COOPERATIVE OWNERSHIP
This is the system of ownership where by economic resources are owned by two or few people for the group benefits. That means resources or business enterprises are collectively owned by two or more people or between people and government for joint benefits.
Cooperative ownership which occurs between government and private enterprises also know as joint venture. And cooperative societies/union which discussed more the topic of marking and distribution.
PRIVATE OWNERSHIP
This refer to the system of ownership where by major means of production are owned privately and decision made by private enterprises for private benefits i.e. profit maximization
Most of private enterprise which emerge as a result of private ownership make private decision without interference from government such as what to produce, where to produce ,when to produce and how to produce for profit maximization.
ROLES/ ADVANTAGES OF PRIVATAGE SECTOR OWNERSHIP / NON-GOVERNMENTAL ORGANIZATION (NGO’S)
DISADVANTAGES OF PRIVATE SECTOR/ OWNERSHIP
TYPES OF PRIVATE SECTOR
There are two main types of private sector
FORMAL SECTOR
These are private sector established and operated by following government rules and regulations laid down by government for controlling private sector. Most of formal sector are large sector
INFORMAL SECTOR
These private sector established and operated without following strict rules and regulation laid down by the government for under taking such activities in the country example of informal sector are street vendors
CHARACTERISTICS OF INFORMAL SECTOR IN AN ECONOMY
ROLES/IMPORTANCE OF INFORMAL SECTOR IN TANZANIA ECONOMY
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