Industrialisation: When business experts shift focus from 2025 to 2056

04Sep 2017
Miki Tasseni
The Guardian
Industrialisation: When business experts shift focus from 2025 to 2056

A PANEL of business experts has lately come up with an image of how to figure out what happens in the country’s path toward industrialisation, which is both a realistic outlook on what has happened in the past 40 years and a prolongation of sorts of this situation in the next 40 years.

It is in this context that the time frame is shifted from 2025 at a minimum and 2030 as a moment to measure its optimal results, not 30 years later.

The issue really is which image is appropriate, or put differently, if Tanzania ought to think of industries in the short or long term logic.

One way of sorting out the matter is the relationship between Tanzania and East Asia or to that extent South Asia, whether industrialisation in those countries can be figured out in one-two decades at most, or one takes up a 40 year span.

On the basis of the presumption that Tanzania isn’t a tiger economy and is unlikely to be one in the near future, in which case a longer term perspective is being taken up.

Even then, there is another problem, as to how the situation is prolonged to 40 years on a piecemeal or incremental advancement concept, without basic issues of what enables industrialization being sorted out. The book delves into those issues.

What can be set out as a preliminary critique is the manner in which the book sets out a transformative problematic and then retains the 40 years perspective, as that would be a contradiction in terms, in which case it can’t be so.

As the book has set out a 40 year problematic, the reason can only be incremental growth of industrial capacity, in which case there is another problem that comes up, as to how far this situation is realistic, of incremental industrialisation without a transformative view of things.

In other words, why would the poverty not be reproduced, fail to sustain the new industrial thrust, if there is no transformative problematic that is instituted?

Obviously that isn’t the problem of the writers but of the powers that be, as to how industrialisation is being mapped out, and whether it is expected to be achieved in ten to 15 years as it is politically understood, or 40 years as a team of experts puts it.

When one looks at demands that are being raised in that direction, it is clear that the realistic frame is five to ten years, especially if one pays attention to reports of key agencies like the Ministry of Finance and Planning as well as the Special Economic Zones administration.

The whole idea of 40 years is one of projection of what is an economics of poverty, especially by examining the role of what key agencies in that quest, like the Dar es Salaam stock exchange in mobilising capital.

The point of departure of a 40 years perspective is that Tanzania is starting on an industrialisation path and in that context it compares with similar decisions reached by the Far East economies in the mid-1960s and early 1970s depending on the state concerned.

This view, while to an extent valid in terms of an actual decision or say, a practical decision unlike the old Basic Industries Strategy that the government had already unveiled at least by the 1975 Budget, fails to take into pivotal use a number of parameters.

One crucial dimension is the Zeitgeist - that despite having different trajectories, there is a global communications sphere, technology shared.

The time frame in which industrialisation takes place is determined by technical or strategic conditions at the local and international level, such that a country seeking to industrialise at the moment isn’t similar to one which made that decision in 1975.

Even within our own context, making a thrust towards industries now isn’t the same as when similar decisions were being made more than one generation ago, in which case the matrix (problematic of realization) can’t be plastered on the same time analogy as it was the case before.

The new and dynamic conditions have to be put in picture; since they are evidently within reach, this informs the politics.

In that case a preliminary critique of the image of industrialization would taken up the ten to 15 year perspective as valid, in contrast with the 40 year perspective that our panelists took up to prepare their strategic documentation.

The reason is that the project is more or less as directly envisioned as are projects like electrification of rural areas under REA, or for that matter ensuring that the whole country was connected with the supply of gas for domestic and industrial use, etc.

Indeed, the whole idea of industrialization isn’t synonymous with being wealthy but rather to ensure that agro-processing takes its place in a systematic way, instead of imports.

Perhaps this is the source of the difficulty, that there is a strident self-reliance view of the matter if one takes account of the panel of experts, that they are figuring out an inward looking industrialization process, raising local capital and taking control of the various sectors.

That means it would from the start have little place for the usual thrust of foreign direct investment, as it has a bad name in this governance phase, and to an extent appetites have been cultivated for that inward look. If anything this might explain the time frame as local mobilization of capital is slow.

Still it doesn’t make the thesis correct due to that altered time frame, for it seeks to invoke a mechanism of slow mobilization of capital and inward looking growth of industry.

While analytically it looks that it will be slow on that account, there is a wider strategic problem of its feasibility, if it shall be able to retain capital for an optimal thrust into industrialization. If FDI is not free, shall local capital flourish?

It is uncertain as yet how far the authors are realistic about the dangers of creeping monetization of savings, when people prefer to place their money in major foreign banks with a view to finally directing those savings to foreign accounts, due to a sharply reduced state of private sector confidence.

On the outside, which can be corrected by paying close attention to the launching presentations and public views on the issue, this seems even to elicit that contribution, as the success of inward-looking public-private partnership.

In Chinese wisdom they would say this is akin to ‘fishing in troubled waters,’ that this yields plenty of disoriented fish, instead of nothing as a sober outlook would suggest.

Capital has to work as a whole, not a portion of it while the rest is stymied; the targeted portion would be overburdened.