Economic Performance in Post-Market Economies and Poverty Reduction: The Case of Tanzania

Abstract

The post-structural adjustment strategies being emphasized by the IMF, the World Bank and donor countries in Africa are privatization and liberalization. In theory, both strategies are assumed to allow firms to operate efficiently and competitively. The thrust of the reforms are necessitated by the quest for improved economic growth, investment, efficiency and productivity. In Tanzania, the parastatal sector reform policy to improve economic performance was adopted in 1992 as a national policy. This paper reviews the economic performance and the poverty status in the country since the adoption of this market-oriented policy. The paper is organized into six sections. Section one, which is the introduction, provides a brief discussion on privatization and liberalization strategies. Section two looks into the background of the economic reforms, and then section three examines the privatization and investment trends. While section four discusses the macroeconomic perspectives and the economic reforms, section five focuses on the impact of the reforms on poverty reduction. Section six concludes the paper.