Economist: Asia's astonishing rebound

the Chinese govt just announced that they would focus on maintaining growth rather than reducing inflation. That means they'll keep buying US debt to allow them to maintain the renminbi peg where it's at now.

Re: dollar as reserve currency...where would FCB's put their money other than the US? Euro...I don't think so...EU has worse deficits, bigger inflation problem, and is recessionary, along with demographic time bomb. Yen...nope...everyone's been shorting the yen and yields on JGB's are zilch. Plus Japan's national debt is sky high.

Interesting article on this week's Economist.







IT NEVER pays to underestimate the bounciness of Asia’s emerging economies. After the region’s financial crisis of 1997-98, and again after the dotcom bust in 2001, outsiders predicted a lengthy period on the floor—only for the tigers to spring back rapidly. Earlier this year it was argued that such export-dependent economies could not revive until customers in the rich world did. The West still looks weak, with many economies contracting in the second quarter, and even if America begins to grow in the second half of this year, consumer spending looks sickly. Yet Asian economies, increasingly decoupled from Western shopping habits, are growing fast.

The four emerging Asian economies which have reported GDP figures for the second quarter (China, Indonesia, South Korea and Singapore) grew by an average annualised rate of more than 10% (see article). Even richer and more sluggish Japan, which cannot match that figure, seems to be recovering faster than its Western peers. But emerging Asia should grow by more than 5% this year—at a time when the old G7 could contract by 3.5%. Western politicians should brace themselves for more talk of economic power drifting inexorably to the East. How has Asia made such an astonishing rebound?


Out of smoke and mirrors, say some Western sceptics. They claim China’s bounceback is yet another fake. The country’s numbers are certainly dodgy: the components of GDP do not add up, and the data are always published suspiciously early. China’s economy probably slowed more sharply in late 2008 than the official numbers suggest. But other indicators, which are less likely to be massaged, confirm that China’s economy is roaring back. Industrial production rose 11% in the year to July; electricity output, which fell sharply last year, is growing again; and car sales are 70% higher than a year ago.

And surely the whole of Asia cannot be engaged in a statistical fraud. South Korea’s GDP grew by an annualised 10% in the second quarter. Taiwan’s probably increased by even more: its industrial output jumped by an astonishing annualised rate of 89%. India was hit less hard by the global recession than many of its neighbours because it exports less, but its industrial production has also perked up, rising by a seasonally adjusted rate of 14% in the second quarter. Output in most of the smaller Asian economies is still lower than a year ago, because they suffered steep downturns late last year. But at economic turning points, one should track quarterly changes.

http://www.economist.com/opinion/displayStory.cfm?story_id=14214001&source=hptextfeature

Financing Kilimo Kwanza: Commodities Markets or Agriculture Bank

In his search for the agriculture development in Tanzania, President Kikwete (JK) has been trying all the tricks in the bag. He first called for the change in the law in order to introduce lease financing so farmers can purchase equipment, especially tractors. Then he went through many initiatives in his monthly speeches to the nation, including introducing seed research center. Recently he unveiled “Kilimo Kwanza” program – an expected holistic way of introducing green revolution in the country. The program is supposed to give access to farmers on research, sustainable market, credit – from the soon to be created Agriculture Development Bank, and many other promised goodies in the bag.

His heart is in a right place, and God bless him, but the path that he is taking is historically well ploughed with dismal result and an anemic economic growth.

The main deficiency here is that as hard as this administration tries it has not fully abandon its state sponsored economic development model in favor of a full private sector driven one. Kilimo Kwanza – or the New Impetus for Agriculture— as per the Daily News, is a model which begins with a thought that the state knows what the farmer’s problems are and therefore it is going to make the solutions readily available to them in the form of services given. This idea is a common mistake in the development arena. Like Mkukuta and Mkurabati before it, the Kilimo Kwanza bag of goodies from the government will only make a small dent.

The Kilimo Kwanza program has many aspects: research for better yielding seeds, providing market access to farmers, using old Nyumbu factory to produce tillers etc. In this piece I will focus only on agriculture financing part of the program. In facilitating credit to farmers there are two ways to go about it, first a dedicated agriculture bank and second a market based capital distribution – commodities market.

Government sponsored credit system led by an agriculture development bank by nature can not efficiently utilize information about the utility of the program. The information that the bank gathers from its clients will not be disbursed to the population at large. When a bank provides a loan to the farmer, the information that it collect will immediately be filed away in the drawer for safe keeping; and it becomes private information instead of it directly becoming public information.

Furthermore, in order for banks to add value to their portfolio and hence survive, they have to lend responsibly. For that to happen, they require collateral – that eternal elusive specie to any farmer in a poor country. And if banks lend without collateral, maybe due to the political pressure of lending to the farmers, the fate of that bank is clear.

For argument sake, let’s assume the long promised title deeds will come true and farmers are going to be able to use them as collateral, banks will still have to figure out how they will get paid back. No bank in the world lends with an intention of confiscating collateral at the end of the credit process. In order for the bank to be paid back, farmers will have to sell their products and therefore gain income first. So the quandary here is that farmers need capital during planting season but they can only pay back after the harvest. Unless there is a way for a bank to be able to estimate how much will the farmer’s income approximately be, there is no way to know how much can it safely lend to that farmer.

Therefore, based on the above mentioned reasons and many others, one can pre-tell the demise of the agriculture bank before it is established. It is not because I can see the future but because agriculture banks in poor countries are hardly successful.

And that is where the power of capital market and its information comes in.

The alternative to the government owned agriculture bank is commodities market. Commodities market is a type of a market which buyers and sellers of agriculture and mining products gets to trade their goods. However, this market due to the nature of agriculture business is a unique market. The market is structured in such a way that solves the farmer’s cash flow timing problem. The market allows farmers to issue a paper – technically in the form of IOU contract — during planting season that let them payback after a specific period of time that will coincide with their cash flow intake. This process most of the time gives farmers the much needed working capital to buy seeds, pay helpers and sustain themselves while the food silos are empty. There is no need of collateral in the commodities market as the market act as an independent third party between the buyer and the seller.

In addition if the farmer does own the land, this market mechanism can be stractured in a way so that the farmer can use the land to raise funds– assuming he does get the title deed—for a capital expenditure like buying a tractor, a harvester, or building an irrigation canal.

This arrangement will give the farmer both types of financing: short term working capital to bridge the cash flow and therefore sustain the production cycle while at the same time allowing access to a long term capital expenditure which will boost the quantity and the quality of his product.

A well function commodities market biggest addition to the society is not just movement of capital from the savers to the users; but also the ability it has to accumulate information from its participants and at the same time making that information readily available to any interested party. Markets normally have many buyers and sellers who come from different backgrounds with different knowledge bases and interests. When these market participants pull their motives of buying and selling the same (or similar) products they technically act on the information that they have accumulated. The act of collective buying or selling at particular price level reveals what market participants think of the value of the good that they are buying or selling at that point in time.

So for example, bwana Mkulima Maridadi who is trying to plant cassava walks into the bank branch and applies for a loan, the branch manager can access the market for the information. The market will allow the manger to quickly ascertain what the current expected value of the cassava that will be harvested three months from today. That way the banker can decide to give Mkulima Maridadi a loan that is not only suitable but at a fraction of the value that he would have estimated that the farmer will rip after harvesting thus increasing the likelihood of profitable repayment.

In addition, Bwana Mkulima could have walked in any bank and not necessarily the government agriculture’s bank to ask for that loan. Because now any bank can quantify, monitor, limit and therefore understand the risk of lending to the agriculture sector. Therefore, what the market would have done technically is to move the agriculture sector away from the opaque informal sector to maybe a translucent area if not a complete transparent formal economic zone. In so doing, the market will disperse the risk of a whole agriculture sector – which in Tanzania is 40% of the GDP, a considerable one—to different banks and not to concentrate it in one institution. The disbursed credit risk will increase the sustainability of financing of the agriculture sector.

Though I am advocating commodities market in place of the agriculture bank, I am not doing it blindly. Markets normally are as good as participant’s knowledge. Therefore, they are susceptible to the highs and lows driven by the risk appetites of its participants. Those who will be borrowing from this market will have to do so responsibly or risk losing everything. Therefore, an education program of how the market works and how to best utilize the funds from the market will have to be in place. Furthermore, in the long run markets normally have more highs than lows and since the rational commodities market participant factors the expected future inflation in today’s prices, the cost of food tends to increase over time. However, if the funds are indeed used wisely, higher food prices do come in tandem with the higher production and quality of food. But since food is a vital resource, commodity markets normally, to certain extent, disfranchise the poor especially the urban poor by making food relatively more expensive.

This last point brings me to the tangent, a line that I don’t want to cross now because it will deviate to a much wider topic: the relationship between food production and hunger or I should say famine. That will be a subject for a next write-up. But just to leave you with a sense of that debate, research has shown that there is no fixed relationship of any sort between the amount of food available and the breakout of a famine.

However, there is a very high correlation between a country’s economic growth and a vibrant financial market of a sector which represent a considerable part of the country’s GDP. Henceforth, JK’s Kilimo Kwanza program should use its limited capital pool to start a commodities market instead of an agriculture bank. Once there is an efficient market, then let all banks, saccoss, and other financial institutions do what they do best: give responsible loans to those who can add the most value to the economy.

What is your Developmental Leadership Quotient?

When I was 10 ten years old my parents sent me to a Christian Leadership Camp on the shores of Lake Michigan (USA) where I was indoctrinated with “The Fourfold Way” of becoming a leader by growing Mentally, Physically, Religiously, and Socially. The acronym for this development theory was thus MPRS, for which the Bible text was Luke Chapter 2: “And Jesus advanced in wisdom and stature and in favor with God and men.”

Fifty years later, when I became president of the World Institute for Leadership and Management in Africa, WILMA claimed that the four key attributes of leadership for national development are Character, Charisma, Know-how, and Vision. WILMA’s first website, now online at www.wilma.us/archive, featured a PowerPoint show that illustrated this point by four clear-eyed gnus that were leading “The Great Migration” of Africa out of dependency on foreign aid. Rarely are these attributes combined in a single person, and when the exception appears, we can only say “Wow.” For example, Barack Obama is such an exception, and so is his wife, Michele.

An individual’s development as a leader by balanced growth of her MPRS maps into a country’s Great Migration with those gnus in the lead:
· Character is the religious dimension: the passion within empowers a person to lead.
· Charisma is the social dimension: leaders are empowered by inspiring love in others.
· Know-how is the physical aspect: leaders are good at engineering social change.
· Vision is the mental aspect: leaders see ahead and, though uncertain, ask “Why not?”

The capacity to lead social transformation (Joseph Stiglitz’s definition of development) can be measured by a person’s ratings on these four dimensions, which in principle can be tested and combined statistically as his/her Developmental Leadership Quotient (DLQ). No such test presently exists, and inventing one would be material for a Doctoral dissertation. A parallel test is the Myers-Briggs test. (You can Google Myers-Briggs to find many services offering this testing of a person’s likelihood of success in various occupations.) The prevalence of high DLQs in a given affinity group (family, tribe, community, or nation) would then be a measure of that group’s capacity to transform itself—socially, economically, culturally…whatever the dream may be.

If we had such statistics measured across countries and across time, outside investors could gauge where to place their bets on successful development. Governments could measure their progress in providing an “enabling environment” for development. The private sector could assess its potential for change.

Many Tanzanians, especially young professionals, seem to feel that Tanzania’s DLQ has declined—that some sort of “social engineering” may now be needed. Where have the clear-eyed gnus of Tanzania’s Great Migration gone? Who can restore the salad days of the Revolution, with its faith, hope, and passion? Where are the Oscar Kambonas of Tanzania’s future?

In my view, the “Cheetah Generation” of Africa is alive and well in Tanzania. For example, Oscar’s daughter, Neema, has just published the second issue of “StartUPBiashara: A magazine promoting small businesses, offering inspiration and empowerment to local businesses.” This is a point of light for the future, and there are many more like it, including WILMA’s program for Tanzania.

Future contributions to January’s blog might well reflect on how to raise Tanzania’s DLQ. I myself have some views about this question and look forward to sharing them.
Paul Armington, August 11, 2009

CDCF: When they want it, they get it.

The Constituency Development Catalyst Fund (CDCF) essentially provides additional resources for development at the local level by channeling money to constituencies under the management of Members of Parliament. The introduction of CDCF to Tanzania is thus supplementing the existing funding mechanisms for local government. Importantly, it may not represent an increase in funding, since funds may be taken away from other parts of the budget in order to finance the CDCF.

Your Member of Parliement just passed the bill last month, in case you didn't know. Article 63. (2) Of the Constitution of the United Republic of Tanzania states “The second part of Parliament shall …have the authority on behalf of the people to oversee and advise the Government of the United Republic and all of its organs in the discharge of their respective responsibilities in accordance with this Constitution”

The CDCF will seriously undermine the ability of Parliament to perform its oversight function independently and thus effectively, since a legislature that is involved in introducing and/or implementing spending proposals compromises its ability to question these initiatives and therefore to hold the executive to account.

The CDCF also creates a parallel structure alongside the existing local government structures and this increases the burden on the already overwhelmed local government officials. This parallel structure also increases the cost of administering local funds by using money which could have been used to increase the resources available for the projects themselves.

MPs claim that they act as ‘ATM machines’ in their constituencies because citizens assume that they have the resources to solve many of their problems. They claim that their income is not sufficient to cater for expectations from voters and that CDF will relieve them of this burden.

However, the role of MPs is to work with citizens to hold the government at central and local level accountable for resources allocated to solve development problems in their constituencies. MPs are not obliged to address these problems themselves unless they choose to do so willingly and have the necessary resources. This is the job of the executive. To take on the role of the executive will compromise their ability to perform their legitimate role.

MPs argue that they are expected by their constituents to deliver development projects despite the fact that they do not have control over where these projects are allocated.

Again, they get it wrong. MPs should work in collaboration with CSOs to educate citizens on the role of MPs. MPs should not make philanthropic promises to voters during elections unless they are sure of their ability to deliver these promises once elected. Normally campaign promises should either be in line with the candidate’s party manifesto or promises that the candidate intends to implement from his or her own sources of funding as philanthropic activities.

MPs claim that TASAF is not democratic hence CDCF will provide a more democratic means of empowering communities at the grassroots level to take an active role in their own development.

But MPs should seek to improve whatever challenges exist in the implementation of other local funding mechanisms, such as TASAF and the Local Government Capital Development Grant since they already seek to address the core purpose that CDCF seeks to address without the additional problems likely to result from the CDCF.

The challenges facing the very concept of CDCF and its implementation make it a highly risky venture for government to undertake. Further, evidence from different experiences at community level, and from previous studies like PEFAR, indicates that the poor quality of service delivery at the local level is not due to lack of funding, but more to systemic weaknesses, poor capacity, political interference, low civic competency etc. This establishment of a CDCF is likely to make this situation worse rather than better.

Additionally, given the existence of other development funds which serve the same purpose as a CDCF in Tanzania, it is recommended that the systemic and systematic challenges compromising the efficient and proper implementation of these devolved funds are contended with, rather than creating an additional fund which is likely to only exacerbate existing challenges.

Needed: Social Engineering?

You will recall Mwalimu's summation for what we need for development: watu, ardhi, siasa safi na uongozi bora - people, land, proper ideology and good leadership. I was thinking about the simplicity and the idealism in this summation. But, you will notice that in these four "necessities" for development, only two are prefixed by adjectives (uongozi bora - good leadership; and siasa safi - proper ideology). These four necessities I think are still relevant. We can replace "proper ideology" with "proper vision", we can see "land" as indicating "resources" in general terms. The point about good leadership has been amply dealt with here. Let us talk about people now. I think that we need, not just people, but good people: honest, hardworking, law-abiding, and thrifty.

But people, in their "natural occurrence", cannot be the agents, the manifest or rather the end of development, and certainly cannot act as a community and for the collective good of the community. So, socialisation - to get the "good people" - is needed. The development of man himself - his attitude, his psyche, his character - is critical before we expect him to be an agent of development or before we think of him as the end of development.

Enter the idea of social engineering. I came across this concept a while ago, in school in fact, but never so much explored it. In thinking about some of the contributions in this blog, and in imagining solutions to what many point as moral decadence in our society (which breeds corruption, dishonesty, fatalism, etc.), I thought about social engineering. The definition from wikipedia refers to efforts to influence popular attitudes and social behavior on a large scale, whether by governments or private groups.

The Cultural Revolution in China from 1966, in which the language, arts, culture and indeed the Chinese national identity was reconceptualised, was in fact an exercise in social engineering. It was sort of a middle-course correction to anchor the 1949 Revolution as a reference point for the modern China's social and political life. About two decades after what was essentially a peasant Revolution, they were beginning to see decadence and corruption. The idea was to entrench a new Chinese social outlook. We also know that after the overthrow of Czar in Russia, the Bolsheviks sought to create a new identity for the Russian people, indeed creating "a new Soviet man", as the campaign was called, with fundamentally different ideals.

Now, come to think of it, our own Azimio la Arusha (Arusha Declaration), Vijiji vya Ujamaa, compulsory National Service, and so on, were exercises in social engineering. To some of my friends, we are what we are as a nation, the good and the bad, because of the collective impact of these initiatives and many other state social experiments. Of course, after the colonial rule, which also engaged in its own social engineering to get the natives to acquiesce to, or at least live with, subjugation, social engineering was necessary in an effort to build a new nation. But these social engineering initiatives were undertaken in the context of a certain era in global political and economic alignment. That era has ended, we have embraced a different socio-economic philosophy but still haven't undertaken to undo the psyche developed by the socialisation of that era.

Now, do we have to undo it or are we okay and this is not an issue? If we do, what kind of social engineering interventions that would create "a new Tanzanian man" with a new ethical outlook? Obviously, the kind of social engineering that can take place is limited by the prevailing political dispensation. Democracy, and whole panoply of activists, limits the kinds of interventions one can undertake. Authoritarian regimes - for better or for worse - have more room to undertake extensive social engineering initiatives. Of course authoritarianism is not option. Political scientists talk about "democratic social reconstruction" in which it is possible to transform outlooks and attitudes in the frame of a democratic dispensation. But there has to be a consensus on the ingredients of an ideal society we all want to build. This is one of our challenge.

Rebuilding a shamed subject

A piece from the Financial Times, By Robert Skidelsky, August 5 2009

It was to be expected that our present economic traumas would call into question the state of economics. “Why did no one see the crisis coming?”, Queen Elizabeth reportedly asked one practitioner. A seminar at the British Academy tried to answer and the FT has taken up the discussion.

The Queen’s question is understandable, given the subject’s claims on its own behalf. Ever since modern economics started in the 18th century it has presented itself as a predictive discipline, akin to a natural science. Since the future a year ago included the present slump, it is natural that the failure of the economics profession – with a few exceptions – to foresee the coming collapse should have discredited its scientific pretensions. Economics is revealed to have no more clothes than other social science. One cannot imagine the Queen in, say, nine months’ time, asking a leading political scientist: “Why did no one tell me that Labour was going to win the election?” She would understand that this was not a prediction that any political scientist could make with conviction, however much time he had spent studying present and past opinion polls.

Nevertheless, the Queen’s question was wrong, because it accepted at face value the predictive claim of economics – a feature that has distinguished it from all other social sciences. Karl Popper produced a famous argument against the possibility of prediction in human affairs: one cannot anticipate a new invention because, if one could, one would already have invented it. However, this objection can be overcome if one assumes a stable and repetitive universe in which rational actors make efficient use of the information available to them. In this environment, uncertainty disappears to be replaced by calculable risk. Shocks and mistakes may occur but these will cancel each other out, so that, on average, people get what they expect.

An important implication of this view is that shares are always correctly priced. This is the basis of the so-called efficient market hypothesis that has dominated financial economics. It led bankers into blind faith in their mathematical forecasting models. It led governments and regulators to discount the possibility that financial markets could implode. It led to what Alan Greenspan called (after he had stepped down as chairman of the US Federal Reserve) “the underpricing of risk worldwide”.

It has also led to the discrediting of mainstream macroeconomics. The efficient market hypothesis is simply an application of the recently triumphant New Classical school, which preaches that a decentralised market system is always at full employment. In their obsession with getting government out of economic life, Chicago economists claimed that any consistent set of policies will be learnt and anticipated by a population, and will therefore be ineffective. Since people – apparently including the 10 per cent or so unemployed – are already in their preferred position because of their correct anticipations and instantaneous adjustment to change, “stimulus” policies are bound to fail and even make things worse. Recessions, in this view, are “optimal”.

Most of those unversed in New Classical economics assume that John Maynard Keynes exploded these fallacies 70 years ago. Their re-emergence is not just the result of the failure of Keynesian macroeconomic policy to anticipate or deal with “stagflation” in the 1970s. It reflects a persistent bias in economics towards an idealised account of human behaviour; what Joseph Schumpeter called the “Ricardian Vice” of excessive abstraction. It is only by imagining a mechanical world of interacting robots that economics has gained its status as a hard, predictive science. But how much do its mechanical constructions, with their roots in Newtonian physics, tell us about the springs of human behaviour?

One of the most interesting contributions to the FT.com debate was the argument that, after Keynes, economists should have aligned their discipline with other social sciences concerned with human behaviour. Keynes opened the way to political economy; but economists opted for a regressive research programme, disguised by sophisticated mathematics, that set it apart. The present crisis gives us an opportunity to try again.

The reconstruction of economics needs to start with the universities. First, degrees in the subject should be broadly based. They should take as their motto Keynes’s dictum that “economics is a moral and not a natural science”. They should contain not just the standard courses in elementary microeconomics and macroeconomics but economic and political history, the history of economic thought, moral and political philosophy, and sociology. Though some specialisation would be allowed in the final year, the mathematical component in the weighting of the degree should be sharply reduced. This is a return to the tradition of the Oxford Politics, Philosophy and Economics (PPE) degree and Cambridge Moral Sciences.

Beyond this, the postgraduate study of macroeconomics might with advantage be separated from that of microeconomics. Courses in microeconomics should concern themselves, as at present, with the building and testing of models based on a narrow set of assumptions. Their field of applicability lies in those areas where we have reliable views of the future. Macroeconomics, though, is an essential part of the art of government, and should always be taught in conjunction with subjects bearing on this.

The obvious aim of such a reconstruction is to protect macroeconomics from the encroachment of the methods and habits of the mathematician. Only through some such broadening can we hope to provide a proper education for those whose usefulness to society will lie as much in their philosophical and political literacy as in their mathematical efficiency.

Lord Skidelsky’s Keynes: The Return of the Master will be published by Allen Lane in September

Copyright The Financial Times Limited 2009

The Curse of the Black Gold

Food for Thoughts: Is Vijana a Solution for Tanzania Problem?

In recent years Tanzania has experienced the tsunami of vijana joining different political organizations. We also witnessed the mushroomed of CCM branches across the global from Bangalore to Helsinki. The interesting part is majority of individuals from generation Y and Z believed they do have the skills necessary to overturn Tanzania into prosperity land. On the other side of the coin, most of them undermined the challenges ahead of them when it comes to a country which has chronic poverty, corruptions, and economic imbalance.

The movement of this generation motivates me to write this article. There are many legitimate questions that we should ask our self before jumping into a conclusion and say that generation Y and Z have the medicine for our problem.

First, what will make this generation different compare to the previous generations, and how will it develop intellectuals leaders that the previous generations failed to do? To my understand Leaders are individuals who establish direction for a working group of individuals, who gain commitment from these group members to this direction, and who then motivate these members to achieve the direction's outcomes. So, leadership is an apprentice trade. Most of the leaders develop leadership skills over period of time. The challenge part is majority of the leaders of this generation develop most their leadership skills under the watch of the so called corrupted leaders. So, how can someone convince the society that this few individuals have necessary leadership skills which will revamp Tanzania for good, despite the facts that most of their skill developed under the watch of the so called corrupted leaders?

Second, to my understand education plays the big role to shape the mind of individual. Tanzania education system hasn’t change for quite sometime, we all know in Tanzania teachers at primary and secondary level are the one who failed or receive lower grade at one point of their life. So, what role do these individuals play to shape the minds of the leaders of this generation? When it comes to university majority attended local college where most of the teachers come from the generation which disappoints us in the first place. How will these instructors shape the minds of our generations different from their generations?

Third, the few individuals who received their tertiary education in the West believe they have what Tanzania need. In addition, majority in this group believe that the strategic plan which Western applied in the early ages can be also be applied in Tanzania, which is not necessary true. Apart from that, most of Tanzania looks at these individuals as traitors or the kids who were born with the silver spoon on their mouth. How will this group incorporated their leadership skills to the group which doesn’t trust them in the first place?

Lastly, President Kikwete appointed several individuals from this generation to become leaders on several sectors. For instance Hon. Masha and Ngeleja are from our generation, are they succession stories or disappointments? If they’re disappointments then can someone convince the society that why should they believe on us? How about those few young managers at different private sectors are they non corrupted and accountable individuals?

Make no mistakes; majority of Tanzanian are hungry for change. Tanzanian wants more transparency government, more accountable government and responsible government. However, can the leaders of this generation meet those needs? Or we’re joining CCM in numbers because that is the only way we can stay in comfort zone? What make this generation believe they can deliver, while the generation of their father failed?

The World's Best Investment

You have $75 bilion dollars and you are required to invest it in worthwhile causes. What would those be, and where would you start? An organisation/initiative called The Copehnhagen Consensus put this test to 55 world-renowned economists, including half dozen Economics Nobel Prize winners, and experts in 10 areas identified as global challenges - Air Pollution; Conflicts; Diseases; Education; Global Warming; Malnutrition and Hunger; Sanitation and Water; Subsidies and Trade Barriers; Terrorism; and Women and Development.

Eight renowned economists led the effort: Jagdish Bhagwati, Columbia University; François Bourguignon, Paris School of Economics and former World Bank chief economist; Finn E. Kydland, University of California, Santa Barbara (Nobel laureate); Robert Mundell, Columbia University in New York (Nobel laureate); Douglass C North, Washington University in St. Louis (Nobel laureate); Thomas Schelling, University of Maryland (Nobel laureate); Vernon L Smith, Chapman University (Nobel laureate); and Nancy Stokey, University of Chicago.

The group analysed all these problems, created impact and outcome models and what-have-you, and came up with a list of 30 interventions or investments - ranked on basis of "value for money" i.e. impact on development vis. dollars invested - to tackle these challenges.

The idea of ranking was based on the need for "prioritization" of interventions given the fact that aid resources are dwindling, commitments are not coming through, and, when they do, are channeled without consideration of the outcomes and on the basis of what is hot or fashionable (microfinance is hot now) at the moment.

Guess what came on top as an investment with most impact on development. Not roads. Not conflict resolution.

So, to repeat the question that was posed to the group: What would be the best ways of advancing global welfare, and particularly the welfare of the developing countries, illustrated by supposing that an additional $75 billion of resources were at their disposal over a four year initial period?

From here I copy the text from the liteture of the Copenhagen Consensus, which commissioned this work:

"Ten challenge papers, commissioned from acknowledged authorities in each area of policy, set out more than 30 proposals for the panel’s consideration. During this week’s conference the panel examined these proposals in detail. Each paper was discussed at length with its principal author and with two other specialists who had been commissioned to write critical appraisals, and then the experts met in private session. Based on the costs and benefits of the solutions, the panel ranked the proposals, in descending order of desirability, as follows:

1 Micronutrient supplements for children (vitamin A and zinc)
2 The Doha development agenda
3 Micronutrient fortification (iron and salt iodization)
4 Expanded immunization coverage for children
5 Biofortification
6 Deworming and other nutrition programs at school
7 Lowering the price of schooling
8 Increase andimprove girls’ schooling
9 Community-based nutrition promotion
10 Provide support for women’s reproductive role
11 Heart attack acute management
12 Malaria prevention and treatment
13 Tuberculosis case finding and treatment
14 R&D in low-carbon energy technologies
15 Bio-sand filters for household water treatment
16 Rural water supply
17 Conditional cash transfers (paying parents for sending kids to school regularly)
18 Peace-keeping in post‐conflict situations
19 HIV combination prevention
20 Total sanitation campaign
21 Improving surgical capacity at district hospital level
22 Microfinance
23 Improved cooking stove
24 Large, multipurpose dam in Africa
25 Inspection and maintenance of diesel vehicles
26 Low sulfur diesel for urban road vehicles
27 Diesel vehicle particulate control technology
28 Tobacco tax to deal with disease
29 R&D and mitigation to counter Global Warming
30 Mitigation only for fighting global warming

For more details and background papers on the project go to http://www.copenhagenconsensus.com/Home.aspx

Of course the methodology, purely economics cost-and-benefit analysis, was criticised. But others pointed out that this is exactly the right kind of exercise for assigning aid money. You be the judge.

Nuggets for Thought

1. We have talked about development in this blog several times – and I think it is emerging as a major theme here – but we have not clarified what we really mean by development and when, and under which circumstances, would we know that we have attained it.

What is supplied as development by majority of my fellow bloggers here is a more specific form of the Western model of societal transformation – i.e modernization. The premise of this thinking, which is I think is quite proper, is that at one point, all countries were backward but some countries, those that we now call “the West” or “the North”, managed to overcome this backwardness, and that all countries, including Tanzania, can move from this state only if they adopt appropriate interventions. The reigning paradigm, and the reason we remain hopeful about the future, is that the current state of uneven development between the West and the rest is transitory and that sooner or later we will catch up – through creating favourable [policy and political] conditions within our countries and by ensuring that appropriate interactions exist between us and the developed. Almost instinctively, most people points to ideal characteristics of the West as the ultimate destination of our social transformation. In essence, this says that the development of the backward parts of the world means having them become Western – in trappings and in social organisation. But, of course, different societies have different social structures and psyche that defines what progress is, and these have not always facilitated the success of interventions towards Western model of development. So, what did the leaders and “development partners” do to overcome this? They worked towards creating social structures and a new psyche identical to the Western ones.

I leave for the debate what development means, but the point I want to make is that development is a political process, going together with the development of the polity, not immune to political interests, and that it is not an autonomous process independent of culture and the way state and social institutions operate. Also, simple logic dictates that those who have “developed” before us would be experts on how to attain development and seeking their “advice” or “assistance” is only rational. But now we know that this logic is faulty.

2. Fine, let us say that the entire Third World eventually catches up, just as we hope, and all of us lead an affluent life. But, seriously, given that mother earth is currently under tremendous strain because of overconsumption by people in developed countries, can the entire world realistically and sustainably live in affluence? How will we manage when the entire global population is aspiring to a modern life – including possession of four-wheels drives, spacious cribs, etc – which necessarily produces unmanageable waste? In any case, do we have enough resources to sustain global affluence? Of course some would say that technology and innovation will provide solutions but I think there limits to that. This is something benign but very serious in my view and we need to think about it.

3. I alluded to a bit in my earlier point about the role of culture in advancing or impeding development. Normally, this is a sensitive subject with most people becoming politically correct in maintaining that culture has nothing to do with development. But I am told that, even in our underdeveloped countries, there are tribes that are “inherently progressive” than others. In Tanzania, people mention Wachagga, Wahaya, na Wakinga (there may be others). In Kenya, people mention the Kikuyu, in the Congo they say people from the Kasai province have these attributes, in Nigeria the Igbos are pointed out. It is said that these people work hard, are thrift, value education and tend to progress more than others despite difficult social and political circumstances faced by everyone in our countries. Is this true or is it simplistic way of looking at society and extrapolating larger conclusions on the basis of the vocations of choice or circumstances by these tribes?

4. Back to modernity, and what it means. I have noted the existence of activist groups, particularly in the West, to protect the lifestyles of the indigenous people in different countries (like the Hadzabe, the Masai, the Amazon forest people, etc). Certainly, as the society moves to modernity (as we see it through the reigning paradigm), the lifestyle of indigenous groups cannot be sustainable (Or can it?). It is not an accident or it is not by choice that the Masai now move into cities and towns in hordes – serving as porters in hotel entrances, security guards, pimps, or working in hair saloons – literally denigrating the notion of Morani/Masai pride and heroism. It is because modernity – schools, roads, farms, etc. – is encroaching on their pastures. It is because, in the type of the economy we are pursuing, you can no longer roam with your cows and graze communally wherever you want – people want to own land, fence it and make capital off it – and you certainly cannot keep cattle just for pride. So, what to do? Certainly we must not allow the Hadzabe to exist just for travel photography or for anthropology research?

Time to bin Samuel Sitta

In the wake of new allegations against him, its obvious Tanzanian politics this weekend will defined by one gruesome paradox. Samuel John Tegeza Sitta aka Mr 6 is finished. Yet he still commands, or at any rate makes, regular appearances on the stage. There is endless, lively speculation about how much longer he will remain speaker of the parliament.

One doesn’t need to hit on jamiiforums.com (JF) or back benchers Canteen in Dodoma to understand that ever since his appointment ‘mzee Six’ has been at the apex of the culture of deceit and downright fraud which has destroyed the once luminous reputation of the our parliament.

The historic role of a Speaker is to make sure that Parliament calls ministers to account, and acts - as it has done throughout history - as the sovereign and authentic voice of Tanzanians. In otherwords Speaker is elected to defend the privileges of ‘Bunge letu tukufu’. Those privileges are free speech, free access to ministers and to information, free accessibility to government officials and complete oversight of the government.

It has been a mystery for over three years just why Speaker Sitta not only failed to defend any of these things but actively aided those who attacked them and sought to limit and control them. In the wake of latest allegations which mirrors his Louis XIV public funded life style as per media reports , among other things includes his $10,000 a month rent that in 5 years will cost tax payers close to 1 billion shillings! Now the mystery is solved.

He just didn't understand what the words "defend the privileges of the parliament" mean! I wonder how he even defends those $2,000 a week pharmacy bills which tax payers picked the tab, let alone and those alleged mysterious PYT’s (pretty young things), maybe he thinks it means defending 'perks', 'corruption' and 'the ability to squeeze the last drop of cash out of the public till'! At this stage I can say Mr Sitta has created and defended the world's first bottomless trough exclusively designed and endlessly refilled by the pigs themselves!

The Richmonds, Kiwiras, Radars, IPTL’s and this latest Sitta’s lavish accommodation just confirms that our new rulers are parasites, who enrich themselves constantly at the taxpayers' expense. Ask anyone trying to make ends meet and he/she will tell you that these new breed that rule us routinely abuse power, lie and suppress and manipulate the truth. They never admit error or failure, they always shuffle responsibility onto someone else. In daily life, unlike the old Establishment, they are graceless and self-obsessed.

In sum, they have no standards whatever except their own advancement. Yet they are indignant when anyone exposes their behaviour and turn savagely on those who call them to account. More significant still, Bunge has completely lost its historic role as the primary source of information about the activities of the executive arm of the state.

At least in the old establishment days, ministers with a statement to make used always to bring their news first to the Bunge. This convention has now been abandoned. It is now normal for important statements to be leaked first by those ‘mutants’ at Magogoni and to the JF armchair critics brigade, then only announced as an afterthought to Parliament.


Lets face it, the loss of reality is now total. Although neither Speaker Sitta nor his entourage can bring themselves to acknowledge as much, the ‘spika wa Bunge letu tukufu’ no longer counts in JK’s government, except for the admittedly noteworthy and striking reality that he can continue to call himself Speaker of the House .


Lesson we learn from ‘Mzee Six’ fiasco is simple, when you appoint ignorant, poorly educated people to positions as the Speaker of the house, your rules and regulations decline, your etiquette disappears along with manners, respect and responsibility.

Transforming a nation

I am sure we have all noted that the general trend in public discourse leans towards the yearning for transformation. Even here in this blog, you see this feeling that Tanzania is at a turning point in its life as a nation. Its citizens, young and old, want things to improve. There is a feeling that we are punching below our weight. And, you note that people want things to be different. There are certainly encouraging signs of progress, but there are also fears, and some have been expressed in this blog, that the gravity of old habits, mediocrity and corruption will forestall the social and economic transformation of Tanzania, robbing the nation of a historic opportunity to emerge with a new national self identity and as a competent, self-reliant and prosperous country.

But, now: what triggers this transformation? This is the crux of the matter. But, certainly, wrong assumptions and wrong conception of our main problems lead to wrong debates about what needs to be done and eventually wrong prescriptions. For one, viewing transformation of our nation in the prism of economic growth has led us to focus on wrong approaches – basically a mechanical process of fiddling with inputs and stimulants to the sectors of the economy and the juggling and the restructuring of our institutions. We have to start with our psyche and our attitudes as a people. I know this may sound like Oprah-talk but…

The Process of Transformation

The transformation of our nation as a whole requires change among the individuals and institutions that compose it. Among the core principles required for change are:

1. Fostering a national sense of purpose:

Tanzanians must be inspired by a galvanizing vision of what Tanzania can be and of how they can make it so. The political leadership and the “civil society” and also the family at home can effectively communicate that ‘we can be better than we are’. Political leadership and others in positions of influence, like the clergy, must inspire Tanzanians to see greatness in themselves, indeed to ignite a desire to become great. The vision of purpose must be driven deep into their hearts to inspire ordinary Tanzanians to do extraordinary things. This sense of purpose is essential because no one will die for a strategy, but people will make heroic sacrifices for a noble cause. Special appeals should be made to the youth, who are the next generation of leaders and to women, who are the first educators of the nation.

2. Building trust and confidence in leadership, institutions and the people themselves:

The political leadership should demonstrate repeatedly with strong evidence, that change is possible and that it can occur in many areas of national life. People must see that they themselves can be engaged in important programs of change, and that Tanzanians can increasingly trust their countrymen to meet the challenges of change. (The massive expansion of secondary education over the last four years is an excellent example – the government promised schools… the people delivered them by volunteering to build them). Transparency about the challenges the nation faces and the action underway to meet them is essential to building public confidence, as people trust most what they understand.

The trust and confidence that Tanzanians have in their leaders at the moment is very low. Apart from the President, only very few political leaders enjoy the trust and confidence of the masses. The government must be seen as competent and caring. The role of government, indeed the raison d'être of political leadership, should be beyond service delivery (as conceived in all these plans and programs like MKUKUTA). Building roads, providing water, electricity, etc. are things to be celebrated but cannot be the only litmus test for good governance and government effectiveness. Government is best when Tanzanians are best; Government delivers when Tanzanians deliver. Tanzania is at its best as a government and as a people when there is partnership and cooperation, not when government just delivers services to its people. In this way, there needs to be a change in how people understand themselves and their contributions to Tanzania’s future, and a new national self concept must emerge to effectively turn the corner for a new democracy in Tanzania. This is critical because we have to avoid being crippled by dependency-syndrome – that all the problems – including the piling of trash in our backyard - and all the solutions – including taking care of trash from our backyard - are the responsibility of others. It is amazing these days that almost everyone you hear is complaining, some about things they can take care. This is not a good sign.

4. Demanding integrity:

It is important that Tanzanians understand that social and economic transformation is founded on unified action, fairness, transparency and accountability. For a plan of change to work, people must be compelled to make new and different decisions to comply with higher standards. Transparency creates public accountability that drives change. People must consider this not just in terms of elected officials, but within their communities, among friends and family, and in all aspects of daily life.

The situation as it is now, where 78 percent of Tanzanians do not trust each other, cannot be helpful. We must value honesty, reason, rationality, thrift, hardwork, and a sense of fairness. We must hold ourselves to high standards before pointing fingers to our public officials.

5. Boosting public morale through communication:

Everywhere, for people to be inspired to do greater things, they must feel optimistic about the future. Are we optimistic as a nation at the moment? I think the media has created a sense of pessimism among Tanzanians such that the public morale is low. Under these circumstances, greater effort is required to make people believe again in the future of their country. Nyerere succeeded in this area: we were doing terribly economically but people were hopeful and they followed Nyerere despite ambiguity.

Political leadership must be visible, passionate, and articulate in speaking for a plan for change, conveying the vision of the nation, explaining the challenges Tanzania faces and indicating where change will come and how people will effect it. The plan for change must have a face and a heart. People of every background must be able to see themselves in the process of change and must feel themselves to be in intimate partnership with this process.

Finally, let me just say: the nation is as strong as the character of its people.

Text of Obama's speech in Ghana

Text of President Barack Obama's speech Saturday in Accra, Ghana, as prepared for delivery and provided by the White House:


Listen to the audio here:

http://www.whitehouse.gov/videos/2009/July/20090711_Ghana.mp3

These are the speech excerpts that we sent out to thousands of SMS subscribers in Africa and around the world.





----It is an honor for me to be in Accra & to speak to the representatives of the people of Ghana. I am proud that this is my first visit to sub-Saharan Africa as President of the US.


----The 21st century will be shaped by what happens not just in Rome or Moscow or Washington, but by what happens in Accra as well.


----I will focus on four areas that are critical to the future of Africa and the entire developing world: democracy; opportunity; health; and the peaceful resolution of conflict.


----Governments that respect the will of their own people are more prosperous, more stable, and more successful than governments that do not.



----With better governance, I have no doubt that Africa holds the promise of a broader base for prosperity.



----People must make responsible choices that prevent the spread of disease… promoting public health in their communities and countries.



----America will support these efforts through a comprehensive, global health strategy.


----Africa’s diversity should be a source of strength, not a cause for division
We must stand up to inhumanity in our midst. It is never justifiable to target innocents in the name of ideology.



----I am speaking to the young people. You have the power to hold your leaders accountable, and to build institutions that serve the people.


----I can promise you this: America will be with you. As a partner. As a friend. Freedom is your inheritance. Now, it is your responsibility to build upon freedom’s foundation.

Why is Tanzania Underdeveloped?

I have been thinking about why a country like Tanzania is underdeveloped for some time now. Why is Africa underdeveloped despite having abundant natural resources? I often come across three things in my search for answers: corruption, legacies of colonialism, and unfair western policies. Yet it is clear that many African countries, like Tanzania, have natural resources that western nations could only dream of. Why then do we remain poor and underdeveloped?

I believe the answers to this question will provide clues for solving the problem of African underdevelopment.

This is what Obama had to say about Africa's underdevelopment in Ghana:

“There had been some talk about the legacies of colonialism and other policies by wealthier nations,” he said, “and without in any way diminishing that history, the point I made was that the South Korean government, working with the private sector and civil society, was able to create a set of institutions that provided transparency and accountability and efficiency that allowed for extraordinary economic progress, and that there was no reason why African countries could not do the same.”

He also criticized the culture of corruption in some African countries, saying that those who wanted to start a business or get a job there “still have to pay a bribe.” While wealthy nations must help, he said, poorer countries “have an obligation” to reform themselves.

source: http://www.nytimes.com/2009/07/11/world/europe/11prexy.html?hpw

President Obama interview about upcoming Ghana Visit

He rebuffed Kenya to placate the notion that he might favour his father's country, and to lower the expectations Kenyans might have that his ascent to power mightbring the importance of Kenya into ascendancy.

While he prevaricates, postures and fulminates, China has made the relevance of Western support moot and nearly irrelevant. The Chinese have made Africa their priority and they are now offloading not only their money and technology, but also their poor.

So while Obama is setting up conditions on who he may visit in Africa (something he does not do to Muslims and Cubans by the way), Africa is marching on without him and his USA. We Afrticans did not expect anything of him, or of the Democrats. We got nothing when the last Democrat was in power, and it is not going to be different now.

It is too early,but time will tell.
PART 1:


PART 2:

Obituary: Prof Haroub Othman

When I heard about Professor Haroub Othman’s death on June 28th I was overwhelmed with an extraordinary sense of grief and personal loss, he was widely regarded as the outstanding representative of the post-structuralist left in Tanzania. And what consolation is there for the passing of a great man?



He does not leave behind a great void rather a heaviness of spirit, a weight almost unbearable that mercilessly seems to crush the heart and render each breath an ordeal. Above all, he was the most articulate and visible advocate of Zanzibar in mainland Tanzania, where it earned him many enemies within the ruling elite.


But Haroub Othman was not just a great scholar; he was a brilliant mind, an ardent nationalist, an advocate of justice, a free spirit, an unrelenting force for integrity, an uncompromising fighter on behalf of human dignity, and all the other sets of superlative depictions that he so aptly deserves. It is easy to say we still have his ideas, books, lectures at University of Dar es Salaam and else where, the records of the debates he waged around the world.


But Haroub Othman was a writer you loved as a whole person. You loved the way his laugh filled the room, his confident walk, the easy, mellifluous voice and the sometimes merciless sarcasm from which he would not spare himself. We will read Haroub’s works over and over again, and will commemorate his memory in the years to come. But it is hard knowing we will no longer watch him striding into battle, stripping off the varnish from insidious words and tearing the mask from the face of corruption.


He had a gentle identification with the oppressed and an intimidating rage against the oppressor, a warm embrace for the victim and a cold rejection of the culprit, a love for the post-union Zanzibar and all that its struggle stood for, and a total loathing for discrimination, racism and the degradation of human life and rights.


Haroub Othman was no saint. His ideas were not above criticism or debate. To my mind, there is something in these criticisms, but this was not the real point of his scholarly works. For Haroub Othman’s real achievement is to have defined what I will call, the will to dispossess that is at the heart of this scholarship. His writings are properly situated in the politics of dispossession that have their springboard in his Zanzibar origins. To understand his significance properly is to understand the recent history of Zanzibar.

However what is beyond discussion, though, is that Haroub Othman was as great an advocate of his people as he was a champion of knowledge in the service of humanity, of the image of the intellectual, of the victims of neo-colonialism and of the wretched of the developing world. He was a formidable and honourable adversary, even when facing those who lacked honour. Nor did he shrink from subjecting his ideas to renewed scrutiny whenever new knowledge seemed to call for revision, which, perhaps, is one of the most important marks of a sincere and dedicated thinker. Not only did he take an amazing delight in knowledge, he was one of the few who sought to discover the world through literature. He was the model of the peripatetic philosopher, indefatigable and tenacious as he raised the banner of a humanitarian aesthetic.


Haroub Othman may have been "out of place" as his personal narrative encapsulated this unique form of Zanzibarian displacement, but he has always been "in place" for those of us who dared to take his genius and friendship for granted.


In addition to the unbearable burden of his death, we have to bear the knowledge that we had never been prepared to accept it. For a man who has been described by some as "the conscience of Zanzibar," his ultimate absence requires the greater affirmation of all that he had represented, both in the consciousness of a nation and in the hearts of those who loved him.

The list of names and of graveyards will grow larger. The names will increase so we decrease and no one knows where they will die. Haroub Othman's is another grave out of place, another funeral away from the homeland he dreamt about. When we lose a person in such a way sorrow gives way to anger. I am angry because it doesn't make sense that we have to circumnavigate the globe in order to put a flower on every grave containing a creative talent from Zanzibar.


As a man of courage, graciousness, hope and dedication, his memory will remain forever in our hearts.

May his soul rest in peace.

10 Years Latter, DSE is Still Crawling

In the past decade, Africa has experienced a surge in the development of stock markets. On this particular article, the author analyze how does DSE failed to provides incentive to Tanzanian investors. Enjoy the peace!

DSE: 10 years later, is it significant for the national economy?

THISDAY CORRESPONDENT
Dar es Salaam

AS the Dar es Salaam Stock Exchange (DSE) recedes into its usual napping at the end of the year, there are several questions that call for answers, whether the stock exchange was already a significant player 10 years down the road, or if it wasn?t how much time there is before it perhaps becomes one.

So far the DSE had five sessions by perhaps ’forcing’ the pace, but at times, like lately, three sessions have been more or less adequate and it transacts little business all the same. Is Tanzania really a place to conduct share sales, or this is a World Bank fairy tale project?

Experts were trying to point out that Idd and Independence festivals had diminished the trading, which fell by a hefty 79.51 per cent as most companies were inactive and seven that were active traded marginally. Usually such a situation cannot arise if the bourse was embedded into the national economy, but as it is merely a sort of speculative market in like manner as shopping from some fashionable goods in supermarkets, any excuse is sufficient for not going there. One could just say trading at DSE stopped because it was rainy on one of the days, and the following day was too hot.

The DSE market capitalization now stands at 3,901.13bn/-, which in itself is a substantial portion of the economy, the difference being that much of what is quoted there isn’t quite national in character, and it is hard to actually state in what manner the DSE activity itself engages portions of the financial sector, and the financial outlook of the listed firms.

It would for instance be interesting to make a survey of capitalization efforts and stock market activity, where it is unlikely that the DSE activity is substantial for instance to foreign firms listed there. In the latter case, it would be proper to see their presence at DSE in cost-benefit analysis of maintaining offices for that purpose, or adding that aspect of share trading to board activities - instead of hiving off such aspects. It is fallow share trading, where a firm maintains its presence for future benefit, just in case....

Companies like East African Breweries and Kenya Airways are thus on the DSE as a potential stock trading zone in future, while local firms might have an eye to properly raising capital, and this to varying successes, since trading is conducted in relation to ’blue chip’ firms.

There is more of a speculative interest in stocks rather than proper investment, as the latter usually reflects balance sheets and growth prospects, while the former relates to sectors, those which make money easily get the lion’s share of buyers. Thus the listing of the National Micro-finance Bank (NMB) seems to have cut into the dominant share trading place of Tanzania Breweries Limited (TBL), though it is arguable if this shift is sustainable, that NMB has greater profitability prospects in comparison with TBL.

It can thus be said that the creation of the Dar es Salaam Stock Exchange is a ’supply side’ measure, that to the extent that it is of use for putting up a market economy, it was vital to bring it about to that it contributes whatever it can to the process of modernization..

Yet however, it has scarcely been grasped in terms of what it should be, for instance the fact that no pressure has come from either listed firms or the breadth of economic experts that land ownership be converted to private instead of state control, so that a rising land market provides the ’neutral’ charge that the DSE needs for its ’positive’ charge. Without a building and land market a stock exchange cannot work, for it is a sphere of exchanging values and balancing investment efforts - and when both fail, investors run towards gold to find shelter.

Indeed, it is hard to say which market is important to the economy, the stock market or the interbank foreign exchange market - for which there is very little that is said on a weekly basis - but it seems to be the key partner of the government and the central bank in managing the country’s economy on a day to day basis, the stock exchange being a window dressing for wider reform and modernization ’feel good’ needs.

There is more of a financial market in the country than there is a stock market, and the cash that finds its way into DSE is largely what wasn’t accepted at the Treasury bills, bonds market, and which is available for trading or speculative activity generally. There is no proper investment climate that one can credibly underline at DSE.

For instance there is scarcely a report as to whether any funds flow into DSE from any other quarter, though several of its stocks are large firms, and this situation is liked by the central bank as it ensures that the capital account is not liberalized.

While this part of modernization requirements appeared to be a matter of course towards the end of the third phase administration, despite that former BoT governor, the late Dr Daudi Balalli wasn’t known for making any public remarks on the issue, the current holder of the post is apparently an adept of pre-liberalization outlook, or he would perhaps say ’post-liberalization’ scheme of things. With the current global downturn, anti-liberals of all hues find their positions vindicated, for as far as they are concerned, it is capitalism as such which has failed to work properly, and the solution is state intervention to correct that they call market failures.

It is hard to say what can be brought under the ’market failure’ thesis and thus how much the government should do to correct what the market has failed. What can be listed under such a notion depends on the one listing it, and in our case there is pressure to return petroleum to a state firm to import and distribute, since prices being 20% above their predictable global level owing to the fall in crude oil prices if market failure.

Parliament also wants the state to take up at least 50 per cent of shares of gold mining firms, since there is ’market failure’ of equal benefit from their local operations, if everything is left to the market - that is, using merely the instrument of taxation.

Thus under such an aura of convictions, it is hard to see the Bank of Tanzania moving towards capital account liberalization and giving the sort of breadth that the DSE needs. Only when the doors to foreign investment will be opened shall there be stock trading at DSE, along with reform in land ownership so that industrial and financial stocks can be balanced or boosted in value from shifts in economic results or movement in land prices.

In Tanzania at the moment land prices don’t exist at the paper market level, so land isn’t allocated by the market and bringing about the benefits thereof. It is governed by machinations in the government and concerned ministries, dampening stock trading and fostering corruption, hampering credit and ruining job creation possibilities. In the absence of pluralism in economic thinking, as different from a herd mentality created by the 1967 Declaration and underlying nationalism, where blaming foreigners is key to economic and policy thinking as a whole, these methods of governance or land allocation are comprehended as natural.

Sovereignty lies in ability of the president to revoke the title to a certain piece of land, despite the fact that if land was free from the president’s hands its value would rise fast, attract scores of investors and the president’s agencies would then collect the relevant taxation from what becomes a booming economy. But isn’t sovereignty, freedom to do as we please, more valuable to the country than bread and butter, or is that not what was said in the Mwongozo wa TANU, in 1971

.....things. What a week!

There's been a lot this past week, and then there's been this...

"This is it. This is it. This is really it. This is the final curtain call." -Michael J. (march 5 2009)

And that was it.

Sounds as if it was a prediction.

Remembering the beautiful Neda

We've seen the green colour, the defiant crowds, the wounded, people trying to take cover from uncontrollable weapons of the Basij militias and police run away from the angry crowd. We've heard voices of people demanding for their rights, not only from that messed up election but also from unfair treatment of many. But, all that don't speak volume or didn't even come close to that touching, heartwarming moment of the graphic video of Neda, dying on the street. People who came to her rescue begged her to respond to them. Neda didn't and will never respond again. She went quietly and became the international icon of many who want their voice to be heard.

Neda has become the new face of Revolution. The beautiful 26 yrs old University student, is one of those who died trying to fight so that...they can be heard. That's all they wanted, a chance to speak up their mind. No word if she's the only woman who died in this on going chaos, or is there any other? There is a vast majority of female protesters, yes, female protesters, in the upraising against this regime. The beautiful face of Neda represents hope, light, justice, peace and so on and so forth. The young, beautiful people like Neda with their addiction to all things technology, are becoming the voice of the future if not a bright future. But why do they have to be provoked, poked and incited in a way that will cost their lives or other people's,? There is no way to engage them so they don't feel left behind and then retaliate? Young people tend to power a lot of things, be it elections or any kind of movement against the elites, the mullahs, lords of the world who think they can't be touched. However, I think time has changed. It's a speak up moment. Wahusika with their right minds should've known that.

The fate and political lives of Ahmadinejad and Mousavi were in Ayatollah's hands. Eventually, he was the one to decide the election, he has the last say. Him. Wouldn't it be fair to then, satisfy the wish of many? This obviously sounds like it comes from a mediocre person but, what's the point of voting then if the election can be decided by one person or a group of few people? This happens not only in elections but everyday. Regular people are not given a chance they deserve to speak up and share their opinions when it comes to decision making, for their own country.
But, you know what? no matter who decides the outcome of the election, if it's the Ayatollah or the supreme court. If people want to get their message across they'll do it. And the people of Iran did just that. Neda took with her the voices of the downtrodden.