No longer a basket case Tanzania: Privatization adds oomph to East African nation's life and economy.

December 12, 1996

AS ONE OF the British colonies gaining early independence, Tanganyika -- which later became Tanzania in recognition of its union with Zanzibar -- was a symbol. So was its first president, Julius Nyerere. He was an African socialist who appealed to many European social democrats, particularly in Scandinavia and Germany. They gave his impoverished country generous amounts of foreign aid. The problem was that little of anything worked in Tanzania.

Take ujamaa, for example. From that Swahili word for cooperative economics sprang a misguided policy of collectivized agricultural developments along Soviet lines which failed miserably. But because Mr. Nyerere was a principled, hard-headed man, he would not acknowledge disaster. Just as he would not acknowledge that his refusal to maintain open borders with neighboring Kenya was causing terrible economic damage to Tanzania.

Another example was a cement factory bankrolled by foreign donors. When it was inaugurated someone finally realized there was no electricity to power it. And no rail links so that the cement could be shipped to markets. For years that costly factory rusted in the wind.

All this is past history. Tanzania is far from being an African Taiwan, but it is finally moving again. In fact, it is now one of the driving forces trying to recreate the East African Community, a British (and Anglophone) concept rejected by Mr. Nyerere that advocated cooperation among Uganda, Tanzania and Kenya.

Much of the credit must go to President Benjamin William Mpaka, who decided Tanzania's economy and its inefficient quasi-governmental corporations were not working. Declaring that "government has no business doing business," he privatized one-third of 400 state-run enterprises. Suddenly things began happening. The International Monetary Fund expects Tanzania to have a 5 percent economic growth rate this year, the highest in two decades.

For several decades Tanzania was a poor cousin to Kenya, which was thriving in African terms. Today Tanzania's progress is being noticed, particularly because Kenya has so many serious political and social problems that it looks like a powder keg ready to ignite.

Pub Date: 12/12/96

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