World Bank decries poverty amid growing GDP


Elder woman at her "tembe house"
The World Bank launched Tanzania Economic Update in Dar es Salaam on Wednesday, raising concern over failure by an average economic growth of seven per cent to eradicate poverty as over one-third of the population still survive  below the poverty line.

The Breton Woods institution said the country has been performing well over the past few years, thanks to effective demand polices.  Gross Domestic Product is this year expected to grow by six per cent.

Mr Morisset
“If Tanzania aims at reducing the income gap between itself and middle income countries, it has to grow faster and better,” World Bank’s acting Country Representative Jacques Morisset said, “For the (economic) growth to tickle down, the country has to consistently grow at between six and seven per cent, but quality education and job creation will have better impact on the national development.”

The report named Stairways to Heaven: Fiscal Prudence, Value for Money in Education, and Economic Transformation of Firms says money has put children in schools, but learning outcomes are lagging behind as the pass rates have actually declined. 

Prof Ndulu
The report, the first of its kind to be published biannually, shows that since 2005 the combined expenditure on education and health has increased by 190 per cent in real term, the equivalent of an average of 10 per cent par capita per year.

“While low rates of return are the result of multiple factor, they are partially due to the persistent low quality of education, with many school leavers unprepared for the labour market,” the report shows. 

Bank of Tanzania Governor Prof Benno Ndulu said the first challenge was to put children into schools, followed by what the nation wants out of the education sector.

“The second challenge is where we are and what we want out of education,” charged Prof Ndulu, who was one of the panelists,  adding that the economic update was a good way forward as the current focus was on the future, not the past. 

Mr Mafuruki
Another panelist, Infotech Founder and Chairman Ali Mafuruki said the report should not only target pass rates but whether the type of education offered supports other sectors of economic growth.

“Suppose we attained a 100 per cent pass rate but the system cannot consume the entire population…we will still have many youths on the streets…the best way is to improve vocational training and prepare our people to engage in self employment,” Mr Mafuruki who is also Woolworth CEO said.

TOL Gases Chairman Arnold Kileo, said the quality of education was import and the government should let free market to determine the price of education provided by private sector. 

The report indicates that Tanzania is heading towards becoming the gas hub in the region although revenues will only materialize in the next five to seven years: “During the transition, Tanzania policymakers will have to find alternative channels to promote growth.

”Prof Ndulu said the economy’s center stage in the next coming years is going to be in Mtwara following the discovery of more natural gas and probably oil. 

The report also considers that signs of economic transformation have emerged from the private sector with technological and educational improvements as the main drivers. SMEs are now reliable sources of employment and manufacturing exports have been booming in the last seven years.
Source: The Daily News, www.dailynews.co.tz, reported by Abduel Elinaza
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