Lack of strategic linkage between agriculture and industry is among the drawbacks holding back the contribution of the sector to creating jobs and alleviating poverty, former leader of a confederation of manufacturers says.
Mr Felix Mosha former chairman of the Confederation of Tanzania Industries (CTI), told ‘Daily News’ in Dar es Salaam that around 20 per cent only of the locally produced raw materials were being used by the domestic industries compared to 85 per cent in Malaysia and 90 per cent in South Korea.
“Most of the traders linking farmers and the markets prefer and find it profitable exporting the raw products rather than selling them to local industries, the practice that sometimes cause shortage of highly needed raw materials by the local industries,” he noted.
He said a typical example has been experienced in the leather sector where most factories have sometimes led to cut production and lay down workers due to lack of raw hides and skins which are smuggled to the neighbouring countries.
Mr Mosha underscored the need to increase investments in the value addition that will not only reduce post harvest losses but also provide a ‘critical source of job creation.’
“For example sorting of heterogeneous mix of mangoes into high-quality fruit targeted to the fresh fruit export market and lower-quality fruit for juice production for local consumption allows a firm to separate markets and practice price discrimination for high-quality fresh mangoes, thereby increasing its earnings.
Thus, the transformation of the entire agribusiness sector by increasing the productivity of activities at each stage of the different agriculture- based value chains is of paramount importance.
For Prof Humphrey Moshi of the University of Dar es Salaam, the existing gap between the rich and poor will continue to widen as less efforts are being put to foster the linkage while building robust agriculture and industrial sector.
He added that in any economy where living standards have risen substantially and has undergone structural transformation, the proportion of the total population engaged in farming falls as does farming’s relative contribution to national income.
Structural transformation involving a net resource transfer from farming to other sectors of the economy is critical for poverty reduction.
Source: Daily News, reported from Dar es Salaam, Tanzania
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