Assessment of agricultural potential and productivity

The United Republic of Tanzania has abundant land, livestock and natural resources, which could enable it to achieve faster and more diversified agricultural growth and to raise household income through increased production of both food and cash crops. Its four broad agro-ecological zones and six farming systems have generally good soil and water resources and adequate rainfall patterns, except in the arid and semi-arid regions.

Tanzania's high agricultural potential is evidenced by the fact that it currently sustains 4.4 million smallholder farm households, cultivating about 3 million ha, or only 34 per cent of the total arable area. Donor-funded production programmes undertaken in various agro-ecological zones, particularly in the northern and southern highlands, the plateaux and the central semi-arid areas, indicate that the productivity of most food and cash crops could be increased from 50 per cent to 150 per cent by improved crop and animal husbandry practices.

Country and sectoral context and constraints to development

Within the Eastern and Southern African region, the United Republic of Tanzania is a high-potential country, capable of influencing the region’s economic and social horizon. It has a population of 34.4 million and a land area that is vaster than that of Kenya and Uganda combined. Despite the extraordinary economic transformation that has been taking place during the last decade, it is still considered one of the poorest countries of the world, with a per capita income of US$270. As such, it has benefited from the Debt Initiative for Highly Indebted Poor Countries. The country’s economic horizons are dominated by the growth prospects of agriculture, which contributes about 45 per cent of the total gross domestic product (GDP), employs 70 per cent of the labour force and accounts for 60 per cent of the country’s foreign exchange. In the last five years, the United Republic of Tanzania has made substantial progress in stabilizing and restructuring its economy. Building on earlier reforms, it is focusing on reducing poverty and maintaining fiscal discipline by allocating resources under strict cash budgeting principles to prioritized sectors. This has helped the country achieve a growth rate of 4.9 per cent in 2003, which is projected to increase to 5.6 per cent in 2004. Various development indicators show that the economy has now become more resilient and stable, and appears well placed to achieve a stronger growth rate – which is needed to realize MDG targets – provided that donor support and assistance is continuous. From the perspective of overall performance of the agriculture-sector, the country has moved gradually and steadily from a low base of 2.4 per cent in 1997 to 5.5 per cent in 2001. Within the agricultural sector, fisheries registered the highest growth, followed by the crop subsector. However, policies relating to agricultural growth have not yet been sufficiently developed to realize the agriculture sector’s full potential or to create necessary institutional frameworks to lead the process forward.

Source: IFAD

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