EDITORIAL: Economic growth and agricalture inseparable

Sunday May 19 2019


Tanzania is in the middle of its parliamentary budget session in the nation’s de jure capital Dodoma slap-bang in the middle of the sprawling country of some 56 million souls.

Being debated in the august House are the financial and other budgetary proposals of government ministries for different sectors of the Economy, ranging from the largely administrative (Education, Prime Minister’s Office, etc.) to the earthly – like Agriculture...

Talking of Agriculture – generally defined as “the science and practice of farming, including cultivation of the soil for the growing of crops and the rearing of animals to provide food and other products” – the sector is widely acknowledged as crucial to meaningful and sustainable socioeconomic development on the ground.

Indeed, Agriculture is arguably the largest and most important sector of the Tanzanian economy, with the country benefitting from a diverse production base that includes livestock, staple food crops and a variety of cash crops for both the domestic and export markets.

The sector’s contribution to GDP has more than tripled in the last 10 years to 2018, supported by rising cash crops production, an emerging agro-processing segment and strong domestic demand for processed food.

However – according to ‘The Report: Tanzania 2018’ by the Oxford Business Group – farmers and other sector stakeholders face considerable challenges in modernising Agriculture to increase yields and value-added processing, as well as exports.

Nonetheless, the report cautions that diversity of Agriculture leaves the sector well-positioned to benefit from substantial investment inflows in the coming years, with budget announcements highlighting its critical importance to jobs creation, industrialisation and exports.

Functional budgeting

That’s right: functional budgeting is crucial to meaningful and sustainable agricultural development.

But, for that to work as envisioned and required, funding and other material and moral support to the sector must trickle down to small-scale farmers as a matter of course.

In fact, this concept had already been acknowledged, and was in the initial stages of being concretized within the context of the Southern Agricultural Growth Corridor of Tanzania (Sagcot).

As we reported on Friday, the chief executive officer of the Sagcot Catalyst Trust Fund, Mr John Kyaruzi, said “the ultimate aim of the government is to see smallholder farmers become a powerful component of Agriculture – and NOT continue to be used as guinea pigs!”

It is a bit surprising, therefore, that the very same government would withdraw already pledged funding for smallholders under the Sagcot programme.

Indeed, it is somewhat consternating that it did so only because of delays in concluding a financing modality with the World Bank involving the goodly sum of $47 million in a “Matching Grant Fund to equal private investment.”

In the event, the expectations of thousands of smallholder farmers in Tanzania to secure vital capital for agricultural activities have dissolved in bureaucratic mishmash.

This setback aside, we take comfort in knowing that the government is nonetheless mulling all-inclusive options that would further strengthen Agriculture as the backbone of Tanzania’s economy.

Hopes in the government must not be lost.