Despite progress, HDR provides a fresh perspective on economic transformation

Mar 30, 2015

Dr. Servacius Likwelile, the Permanent Secretary, Ministry of Finance (centre) launches the Tanzania Human Development Report 2014 which expected to play a key role in informing policy development processes in the country. The preparation of the report was funded by the UNDP and led by the Economic and Social Research Foundation (ESRF), a policy think tank in Tanzania.

Tanzania has received wide recognition for steering its economy in the right direction over the past decade however real progress on economic growth, while welcomed and necessary, has not been enough to transform human development,” according to the country’s latest national Human Development Report.

To ensure that growth is sustainable and continues to improve peoples’ lives, the report calls for progress on many fronts including raising incomes, addressing deprivation among the poorest of the poor, reducing poverty and inequality, promoting better health and education, ensuring peace, justice and security, and protecting the environment.

If GDP per capita is rising, and remunerative employment opportunities are expanding, economic transformation will result in shared prosperity, and income inequality will be reduced or at least contained, the report points out.

So far, economic growth has only emanated from macroeconomic reforms, better business environments, higher commodity prices, the discovery and export of minerals, particularly gold, and the beneficial impacts of new information and communication technologies.

Even then, production and exports are still based on a narrow range of commodities; the share of manufacturing in production and exports is relatively low, as are the levels of technology and productivity across sectors of the economy.

There appears to be a disconnect between economic growth on the one hand and human development on the other, the report adds. Growth does not appear to go together with the development of human capabilities.

Achieving human development necessitates altering the economy’s qualitative features of production that occur through the growth process, rather than merely expanding output. It necessitates the development of human capital through the provision of quality health, education and training, especially in science, technology and innovation.

The core message is rather than focusing on the mere expansion of output, Tanzania needs to emphasize the importance of changing qualitative features of production that occur through the growth process.

Speaking during the launch of the report, Mr. Alvaro Rodriguez, the Resident Coordinator of the UN system and the UNDP Resident Representative said that the report provided the country an opportunity to discuss Tanzania’s development from a human development perspective – development that is about improving people’s lives.

“We in the UN are very passionate of addressing development from a human development perspective. We believe that people are the real wealth of nations,” he added.

On his part, Dr. Servacius Likwelile, the Permanent Secretary, Ministry of Finance and Economic Affairs said the report will play a key role in informing policy development processes in Tanzania especially at the current period when the government and other stakeholders have initiated the process of reviewing the country’s Five Year Development Plan (2010/2011 – 2015/16) and the National Strategy for Growth and Reduction of Poverty (MKUKUTA) II).

In relation to the ongoing process of developing the next phase of the country’s Five Year Development Plan (2016/2017 – 2021/22), Dr. Likwelile said that a major question has been whether the coming policy framework will continue to separate the two development blueprints in distinct domains as it used to be in the past.

“The critical input of Tanzania Human Development Report 2014 will be on sharpening our thinking on how to synergize the two aspects namely growth and human development so as to make then fit in one policy framework,” he added.

Until now, there has been serious soul searching and interrogations on why Tanzania, despite its sound economic performance, is not making significant progress in reducing poverty of its people. According to the report, making transformation work for human development requires the following related interventions:

  • Creating opportunities for productive jobs and securing livelihoods that make growth inclusive and reduce poverty and inequality; this calls for raising productivity to accelerate and sustain growth everywhere by intensifying agriculture, developing industry and expanding services;
  • Creating meaningful employment outside agriculture as a condition for successful economic transformation;
  • Improving the quality of social provisioning;
  • Human capital and skills development;
  • The production of wage goods for domestic markets;
  • The promotion of exports for economic transformation and human development; and
  • Creating a link between export promotion, economic transformation and human development.

The Tanzania Human Development report 2014 is a country based and country owned. It emanates from the Global Human Development Reports which have been produced annually since 1990. Since global development reports skip many issues at national level, the report was prepared to address country specific themes.

The preparation of the report was led by the Economic and Social Research Foundation (ESRF), a policy think tank in Tanzania. Other collaborating partners in the project included the National Bureau of Statistics (NBS), Office of the Chief Statistician Zanzibar (OCGS) and the Department of Economics, University of Dar es Salaam. The project was funded by the United Nations Development Programme (UNDP).

It is expected that the report will not only spur lively public debates and mobilize support for action and change but also help to articulate people’s perceptions and priorities, as well as serve as a resource of alternate policy opinion for development planning.

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