Despite growth, many still languish in poverty

The impact of economic growth on poverty alleviation has remained low because it was limited to a few capital intensive sectors like mining, finance and telecommunications.

According to the World Bank report on Tanzania Economic Update unveiled earlier this month, Tanzania recorded excellent rates of growth over the past decade with the average annual rate standing at around 7 per cent.

“Despite the high rate of growth, levels of poverty have remained stubbornly high,” it was stated in the report.

For example, the estimated average per capita income in the year 2012 was US$570 with about one third of the population living in poverty, thus placing the country among the world’s 20 poorest.

The levels of growth in labour intensive sectors like agriculture and manufacturing remained modest or even negative, resulting in failure to facilitate higher level of job creation.

“The situation is compounded by demographic pressures, with Tanzania’s population forecast to double by 2030, a rate of growth far higher than that of the rate of growth of jobs,” said the report.

The government in collaboration with development partners has enacted a number of measures to develop human and physical infrastructures, but, despite the efforts, Tanzania lags behind other sub-Saharan African countries.

Furthermore, the size of the country combined with the poor state of its infrastructure and its growing population makes the universal provision of basic services extremely difficult.

According to the WB, the government has implemented programmes to educate people, to build roads and develop power networks that would time before any positive impacts become manifest.

Statistics show that 4.2 million people or about 10 per cent of the total population appear to be trapped in extreme poverty, the threshold for which is defined in terms of a consumption of less than 2,000 calories per day.

“One of the means of facilitating reduction in extreme poverty in the country may be to implement an effective cash transfer programme as par of a mix of aid instruments,” stated the report.

Source: Daily News, reported by Sebastian Mrindoko from Dar es Salaam, Tanzania

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