A Catch in Samia’s Economic Success Story

President Samia’s accomplishment lays bare a scary reality in the Tanzanian political-economic situation: the failure of CCM to ensure economic policy stability, which is the bedrock of long-term growth.
Damas Kanyabwoya1 April 20226 min

That President Samia Suluhu Hassan deserves praise for her stewardship of the economy in her one year in office is generally accepted. Government officials, CCM cadres, spin doctors and even some independent observers have said it all.

Churning out numbers, they have explained that what President Samia has taken one year to achieve could have taken another President five years. It is difficult to gauge this independently, but credit should be given where it’s due.

What is obvious, however, is that President Samia’s accomplishment is more in the restoration of the economy, which was spiralling downwards. It should be noted that President Samia took over the country in a difficult environment. The COVID-19 pandemic had devastated the economy.

Despite the shock from the sudden demise of President John Magufuli, however, she hit the ground running. She seemed to know right from the beginning where she wanted to take the country. And she calmly and repeatedly explained her strategy, which hinged on opening up the country’s economy to foreign investments.

Numbers don’t lie

The wise men say numbers don’t lie. And in President Samia’s case numbers can’t fully capture what she has brought on the Tanzanian economic table. It is in the valued intangibles, which can’t be measured in numbers that she has delivered in flying colours.

In only one year President Samia has reassured the private sector that they are important stakeholders in Tanzania’s development endeavour.

She has ended the cat and mouse games that dominated relations between the Tanzania Revenue Authority (TRA) and the private sector. In short, she has thrown a lifeline to the business community.

Tanzania is not an island,” President Samia has asserted repeatedly when she became the Head of State. And she has delivered in that. She has shown up in the expos, forums and in important global gatherings of leaders.

Her speech at the United Nations General Assembly last September was rated among the seven most consequential UN speeches in 2021, by the Foreign Policy magazine. In that speech, she reaffirmed Tanzania’s commitment to multilateralism, saying: “Multilateralism must always prevail!”

The result of all this has been huge inflows of foreign investments in spite of the tough global economic situation caused by the Covid-19 pandemic. President Samia has also been able to convince donors to release the concessional loans they had withheld since the Zanzibar General Election was annulled in October 2015.

Withholding of concessional loans by donors was one of the reasons for the rapid increase of the public debt. The government has had to rely on expensive commercial loans, which has been eating a large chunk of the national budget.

A catch in the success story

President Samia’s accomplishment lays bare a scary reality in the Tanzanian political-economic situation: the failure of CCM to ensure economic policy stability, which is the bedrock of long-term growth.

Listening to Cabinet ministers’ drum beating about how President Samia has rescued the economy from the abyss, one would think that a new political party came to power in March 2021.

In Parliament and in public events, these ministers, some of whom served in President John Magufuli’s government, have been talking about how the situation was dire during the late leader’s reign and how President Samia came over and saved the day.

It is true that President Samia has managed to rectify the situation. But why was the situation that bad in the first place? As noted above the COVID-19 pandemic, was partly to blame.

But so, too, were policy changes undertaken by the late President Magufuli in the five years he was in power. In fact, it was more than policy. It was the general change in the attitude of the government towards foreigners that was more worrying.

When President Magufuli started making policy changes, the same Cabinet ministers were going around explaining how he had found the situation damning and how he was restoring the country and its economy to its former glory. And as he was getting it back the country slid into deep economic nationalism.

Unpredictability as the only predictable factor

It is unfortunate that in CCM economic policy unpredictability is the only predictable factor since the independence of this country.  President Julius Nyerere made the first major move when he opted for the centrally planned economy.

He articulated his choice very well and assured Tanzanians that he had good intentions and was doing it for the long-term benefits of the country. It wasn’t feasible, however, and the country returned to the private sector-led economy.

Since then it has been like a flag, flapped left and right by the wind. Each president coming with his own agenda seems like a new political party has taken power.

President Samia’s zealous economic opening up could come back to haunt her if the corrupt elements are not checked and if rent-seekers and opportunists are left to run astray.

It is worth noting that President Samia herself has started to worry that corruption is getting out of control.

Nothing hasn’t been tried before. President Ali Hassan Mwinyi opened up the economy the same way and it was disastrous. To open up or not to open, that is not the question.

The question is: should solutions to Tanzania’s economic malaise come from abroad? What is the role of Tanzanians in building their own economy, however difficult that may be?

Foreign investors have their place and they flock to almost every economy in the world. But aren’t they meant to supplement local efforts? Doesn’t foreign investment work better when the local economy is well built with the full and active participation of the citizens?

Another issue is if the opening up is not done correctly another CCM President could shift inwardly and adopt policies that rattle foreign investors.

Damas Kanyabwoya is a veteran journalist and a political analyst based in Dar es Salaam. He’s available at dkanyabwoya@gmail.com. These are the writer’s own opinions and it does not necessarily reflect the viewpoint of The Chanzo Initiative. Want to publish in this space? Contact our editors at editor@thechanzo.com for further inquiries.

Damas Kanyabwoya

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