R e p o r t N o. T.A.7 CIRCULATING COPY CO/9 F/.P IC TJ_F-L-- TO BE RETURNED TO ARCHIVES DIVISION Public Disclosure Authorized This report is not to be published nor may it be quoted as representing the Bank's views.

INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT Public Disclosure Authorized THE ECONOMY OF TANGANYIKA

(Preliminary Memorandum for the IBRD Survey Mission) Public Disclosure Authorized

May 14, 1958 Public Disclosure Authorized

Prepared By: Walter A. Chudson J.P. Hayes CONTENTS

Page

Basic Statistics Maps and Charts

Chapter I - General Description of Tanganyika...... 1

Geography, Climate and Natural Resources...... 1 The Pepe...... 4 Government ...... **0.0.00600009 6

Chapter II - The Economy - Structure and Growth ...... 10

Historical ...... C.. 60 .. .. .09 10 National Product and Its Composition...... 12 Capital FormationO.. ...0...... 0014 External Trade and Payments ...... 15 Agriculturec ...... 20 Transport...... 30 Mining ..... 32 Manufacturing ...... 34 Monetary and Financial Institutions...... 35a

Chapter III - Development Plans and Their Financing....,.... 36

The Territorial Budget...... 36 The Capital Budget...... 38 Official Development Plans ...... 39 Ten-Year Development Plan, 1940-65...... 40

Appendix I - Capital Requirements Program, 1955-65

Bibliography Statistical Tables BASIC STATISTICS

Area

Land area (excluding major lakes) 341,150 sq. miles Population

Total (1957 census) 8,785,600

African 8,662,700 European 20 ,500 Indian and Pakistani 71,700 Arab 19,100 Other 11,600

Average annual rate of growth, 1948-1957 1.6% Average new permanent European immigration, 2,700 per annum 1955-1957 African employees (1957) 430,000 As percentage of adult population 9% Geographical Product (monetary economy) 1957 f92.3 million Shares of sectors in total product (per cent) Agriculture 49 Livestock 11 Mining 3.5 Manufacturing 3.5

Average annual growth of real product, 1954 to 1957 - 2.0% Gross fixed capital expenditure (monetary economy) £22.2 million External Trade, average 1956 & 1957.

Exports (f,o.b.) f 45.7 million of which: to Kenya and Uganda 22.1 million

Imports (c.i.f.) £ 44.6 million of which: from Kenya and Uganda £7.0 million Leading exports: Quantity Value Per cent of total Sisal 183,700 tons l10.2 million 24.1 Coffee 19,800 tons f 8.2 million 19.4 Cotton 27,600 tons f 7.0 million 16.7 Diamonds 365,400 carats 13.17million 7.2 67*4 Destination of exports, 1956: Sterling area 55% Western Europe (non-sterling) 30% United States and Canada 9% Other countries 7% Unit value of exports (1950 = 100) 1948 74 1952 136 1957 92

Public Finance (1958/59 budget estimate of The Central Government, fiscal year ending 30 June)

Total Current Revenue2/ £19.8 million of which: Taxes on income £6.1 million Taxes on expenditure (including import duties) M10.0 million Total Current Expenditure £21.0 million

Expenditure on Development Plan (capital budget) f 6.0 million Capital budget: sources of funds Loans and territorial sources f4.5 million U.K. and other foreign grants fl.5 million

Functional division of combined current and capital budgets

Total £27.0 million of which: Economic services £8.5 million Social services £8.1 million Admi-nistration, law and order £6.5 million General expenditure £3.9 million

Public debt (30 April,-1958) f16.3 million

I/ Includes some small U.K. grants for current purposes. Money and Banking 1957

Currency in circulation fl9.0 million Demand deposits of commercial banks £13.8 million Tanganyika savings banks Number of depositors 99,600 Credit balances f 2.4 million

Prices

Cost of living (excluding rent) - Dar es Salaam, Dec. 1958 (1950 = 100) 143

Retail price index of African consumers goods - Dar es Salaam, Dec. 1958 (1951 = 100) 125 TAALUSVOLUD4 AND PRIC3 Or 111ORT1 MM0 ILB ffgAJYX

to Iestleationq Outsid East Arica

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CHAPTER I. GENERAL DESCRIPTION OF TANGANYIKA

GEOGRAPHY, CLIMATE AND NATURAL RESOURCES

1. Tanganyika lies just south of the Equator between the Great Lakes (Lakes Victoria, Tanganyika and Nyasa) and the Indian Ocean. With a land area of 341,800 square miles, it is the largest of the three units compris- ing British East Africa, the other two being Kenya and Uganda. Stretching about 725 miles from north to south and 660 miles from east to west, it covers an area equivalent to pre-war Germany, France and Belgium, or roughly the same as Nigeria. It takes two days and two nights to travel by train from Dar es Salaam to Mwanza on Lake Victoria or to Kigoma on Lake Tanganyika. The size of the area, together with the fact that the portions suitable for agricultural and possibly mineral development are scattered and remote from the coast, means that communications inevitably play a major part in the development of the territory.

2. With the exception of a narrow belt along the 550-mile coast (which is reasonably well equipped with harbors), the country consists largely of a gently undulating plain with an altitude of about 4,000 feet. In the north Mount Kilimanjaro, with a permanent ice cap, rises to over 19,000 feet, and a belt of high land runs southeast from the Usambara mountains in the northeast corner of the country to the Southern Highlands around the tip of Lake Nyasa.

3. Three climatic zones can be distinguished, though very considerable local variations are to be found:

(i) The warm and humid coast region.

(ii) The hot and dry zone of the central plateau at altitudes up to 5,000 feet.

(iii) The semi-temperate regions of high rainfall around the slopes of the mountains Kilimanjaro and Meru and some other highlands elsewhere.

In the central plateau, which comprises more than half of the territory, the main climatic feature is the long dry spell from May to October, fol- lowed by a period of low rainfall which is often concentrated into rela- tively few days of heavy showers. Furthermore, the rainfall in this region is markedly irregular from year to year; in much of the area the chances of receiving more than 20 inches of rainfall are poor. Bushland and wooded grassland (savanna) are the predominant types of vegetation. The land so covered is sparsely inhabited, not only because of the lack of water but because much of it is infested by the tsetse fly. On the coast the annual average rainfall is higher, ranging about 45 inches, but here also there is a long dry season; the main rainy season is from March to May but there is a second season from October to December. Around Lake Victoria in the northwest rainfall is well distributed throughout the year but there is a peak during March to May. - 2 -

4. Roughly 30,000 square miles, less than a tenth of the total area, is classified as "agricultural country," consisting of land now cultivated or land formerly cultivated but abandoned under the traditional practice of shifting cultivation with a long periodic fallow. Only an estimated 3% of the land is usbd. for arable and tree crops. About 80% or more is considered to have potentialities only for forestry and range livestock production, subject to effective control of tsetse infestation. Most of the present agricultural cash crop production and population are concen- trated in a few areas of higher rainfall and better soils in the periph- eral areas of Tanganyika (the southern highlands and the northern coffee- sisal areas around Mount Kilimanjaro and Mount Meru and the cotton and coffee areas around Lake Victoria in the west). Regional distribution of the main types of vegetation is shown in Table 1 1/.

5. The country, though appearing well watered on the map, has in fact few permanent rivers of any size, reflecting the fact that the rainy season as a rule extends over less than half the year. Several of the permanent rivers flowing into the Indian Ocean are, however, of actual or potential importance in connection with water development and potential generation of electricity. The most important of these is the Rufiji, with its many tributaries from the south and center of the country. The Rufiji River Basin, covering an area of about 68,500 square miles - 20% of the country - is considered the only large potential area for long-term agricultural, power and irrigation development.

6. The influence of these environmental conditions on agricultural activity has been well summarized in a recent report by the F.A.O. in the following terms 2/:

"Tanganyika is a large country .... Yet it has only 8 million inhabitants. There is, therefore, on the face of it plenty of room for people to live. It is not like India, China, Italy or Israel, a country where demographic pressure makes the question of development extremely urgent. Nevertheless, the population is rapidly increasing, and there are certain reasons which make the use of land dif- ficult. Among the first of these is the unreliability of rainfall. About a third of the territory, the centre, is only suitable for pasturage. Reliable rainfall is con- fined mainly to the periphery, to a large area in the South and West, to the district round Lake Victoria in the North, and to a few mountain masses which rise in isolated out- crops from the dry plains at their feet. The remaining extensive areas are marginal.

Tables with Arabic numerals are contained in the Appendix. 2/ Report to the United Nations Trustees hip Council aubmitted by the Food and Agriculture Organization concerning land tenure and land use problems in the Trust Territories of Tanganyika and Ruanda-Urundi. Document T/1438, 19 February 1959. - 3 -

"Two other factors eliminate very large areas of land from entry by people with only primitive resources. About sixty percent of the country has no easily obtainable water, and a similar vast area, mainly in the South and West, is infested with tsetse fly, which make the running of stock impossible and in places bring a danger of human sleeping sickness. The absence of roads, the presence of wild ani- mals and the prevalence of malaria and other diseases are additional discouragements,

"These natural circumstances have determined the dis- tribution of the human population. The people are concen- trated mainly in the well-watered areas on the isolated mountain masses in the North, or near the shores of Lake Victoria, or in the higher rainfall areas in the far West and the far South, or along the coast.

"History has added to this marked pattern of local isolation. Prior to the German occupation at the end of the nineteenth century, considerable migrations of pasto- ralists, Hamites originating from Nilotic regions farther North and different from the Bantu inhabitants, invaded the central pastoral area. The most famous of these were the celebrated warrior tribe, the Masai, who terrorized those around them and kept them closely confined. The Zulu Angoni played a similar part in the South of the country, and on top of a pattern of considerable inter- tribal friction must be placed the slave trade emanating from Arab settlements along the coast.

"This combination of natural and historical circum- stances has produced an extremely uneven distribution of human occupation and great variation in the degree of development, leaving as a major feature of today's scene a strong sense of local particularism. It has produced also a centrifugal pattern, the North-west having much in common with Uganda, the North-east with Kenya, and the South and West with Nyasaland and Rhodesia, whilst the coastal strip and the pastoral centre remain entities of their own. These peripheral alignments and the great distances which separate these regions have made a sense of cohesion in one country a remote concept in most people's minds until very recent political movements have brought it to the fore."

Minerals

7. Mineral production has thus far played little part in Tanganyika's economy, though recently its importance has been growing mainly through the development of diamond mining. The mineral potentialities of the country have as yet been but little explored. Only slightly more than one-tenth of the country is considered to be covered by good geological -4 -

maps, but an intensive program of geological surveying is being pursued by the government and certain private explorations are proceeding. The area to the east of Lake Tanganyika is known to be highly mineralized and is now being closely examined.

THE PEOPLE

8. According to the census taken in 1957, the African population is estimated at 8,663,000. Of the relatively small non-African population, totaling 123,500, Indians and Pakistanis account for 72,000, Arabs 19,000 and Europeans 20,500, of whom about 3,000 are considered to be permanently settled in the country (see Table 2). Between 1948 and 1957 the African population is estimated to have grown at the annual rate of about 1.8%, which is below the estimated rate for Africa as a whole. In a number of the more densely populated areas, however, the African population is grow- ing more rapidly than the average, and the Asian population-is growing even faster (3% per annum). The African crude birth rate is high and the prospect is for an increase in the rate of population growth as death rates decline with improved health and other facilities.

9. The great variation in population density within the area is indi- cated by the fact that in several provinces (Tanga, Northern and Southern Highlands) density exceeds 450 persons per square mile, whereas the average for the whole territory is 26 per square mile (see Table 2). Apart from Dar es Salaam with a population of 129,000 there are only nine towns with populations exceeding 10,000 (see Table 3).

10. Only about 430,000 of the African population are engaged in full- time or part-time employment for wages, about 135,000 being employed on sisal plantations. Industrial distribution of African employees is shown in Table 4 and their occupational status in Table 5. The remainder of the Africans is largely engaged in subsistence production of crops and livestock and to a limited extent in the production of cash crops, often as a marginal activity. The major exception is the Chagga Tribe on Mount Kilimanjaro, which is one of the most prosperous African groups in the territory owing to its successful development of profitable coffee produc- tion, largely on a cooperative basis.

11. The bulk of the African population lives under tribal conditions, with 127 separate tribal groups being recognized. The largest tribe, the Sukuma, numbers only about one million, one-eighth of the population, while the next 12 tribes represent another 40%. Special mention may be made of the Masai, a semi-nomadic tribe of pastoralists of Nilotic origin, which while numbering less than 100,000 in Tanganyika inhabits a large area in the northern part of the territory. Tribal divisions are geo- graphically well defined, a fact which is of significance in relation to problems of land tenure. A certain measure of "detribalization" is in progress, and substantial African migration to the towns, particularly to Dar es Salaam, has raised a number of administrative and social prob- lems.

12. Ethnically most of the African population belongs to the Bantu group but linguistic differences are considerable. Swahili, the language of the coastal people, is understood in most parts of the territory and - 5 -

is a useful lingua franca, although regarded as ill-adapted for technical purposes or for the expression of abstract ideas. Until 1956 Swahili was used throughout the primary and middle schools and to some extent in secondary schools as the language of instruction; steps are now being taken to substitute English as the general language of instruction, but progress is hampered by the fact that few African primary school teachers know English.

Education

13. The question of educational advancement is a major issue in the territory in relation to its prospective political evolution as well as to the promotion of economic development. In the whole country in 1958 there were 9 African doctors, 2 lawyers, no African engineers and no Africans in a managerial capacity in any large-scale private business. Less than 20% of the school age population is enrolled in primary, secon- dary and technical schools (a proportion which applies to a number of other African countries, including the Sudan, Ethiopia, and most of French Equatorial and West Africa, but is lower than in Kenya and Uganda). Of an estimated 850,000 African children of primary school age, some 367,000 are at present attending Primary Schools. The number of African children of middle school age is also about 850,000. Of these, some 35,000 are attending Middle School. If provision were to be made for 15% of the 850,000 children of middle school age to proceed to proceed to secondary schools, 122,200 additional secondary school places would have to be provided.

14. The expansion of educational facilities poses a major budgetary problem, quite apart from such technical problems as teacher-training, the relative emphasis to be given to the expansion of primary, secondary and post-secondary education, etc. Combined current and capital expendi- ture on education has risen from £1.8 million in 1952 to £5.3 million in 1958/59, and now absorbs about one-fifth of the budget. The implications of large-scale expansion of education facilities are astronomical and perhaps somewhat beside the point. Tanganyikats representative recently informed the United Nations Trusteeship Council that providing primary and middle school places for all African children, together with secon- dary schools for 15% of those leaving middle school and the correspond- ing training of additional teachers would cost £40 million in capital and £46 million in recurrent annual expenditure, as compared with the total current budget of £20 million. At the same time he noted that in spite of the fact that less than half of the African children of primary school age and less than 5% of the children of middle school age are attending school, over 100,000 places are unfilled in primary schools and 5,000 in middle schools.

15. Since the end of the war considerable progress has been made in higher education and teacher-training, although the numbers are still small. In 1958/59 there were 218 students from Tanganyika at Makerere College in Uganda, the University College of East Africa, and there were additional places which could have been filled if suitably qualified - 6 -

candidates had been forthcoming. There were also 200 students from Tanganyika taking higher education courses outside East Africa and 33 students at the Royal Technical College, Nairobi. There were 1,769 teachers in training in Tanganyika and a number of special technical and vocational training institutions operated in the Territory, notably the Dar es Salaam Technical Institute, the Moshi College of Commerce, the National Resources School and various other trade schools. A spe- cial Working Party on Higher Education which was sent to British East Africa by the United Kingdom Government in 1958 has recommended the establishment in Tanganyika of a University College comparable to Makerere College and a site has been selected. Health

16. The provision of public health facilities poses financial and technical issues similar to those in education. The government's devel- opment plans contain substantial provision for public health facilities and actual expenditures (current and capital) in this field have risen from £1.1 million in 1952 to £2.4 million in 1958/59. The number of hospital beds increased by 45% between 1949 and 1956. Considerable progress has also been made in the training of African medical personnel, mostly medical assistants and aides. Nineteen medical students from Tanganyika were in training at Makerere College in 1957. Numerous dis- pensaries have been established in rural areas, with emphasis on preven- tive medicine. The incidence of malaria, yaws and venereal diseases is high, and tuberculosis is regarded as a serious and growing problem. The gradual growth of irrigation facilities is also reported to be increasing the prevalence of bilharzia. According to a nutritional appraisal by the World Health Organization over-all calorie intake is generally adequate, but there is widespread protein deficiency of greater or lesser extent, particularly in children, due partly to ignorance.

GOVERNMENT

Central Government

17. Prior to the First World War Tanganyika was the main part of a colony under German administration, known as German East Africa and including what is now Ruanda-Urundi. It came under German administra- tion in 1891 when, following an agreement between Great Britain and Germany adjusting their disputes regarding spheres of interest in many parts of East, West and South-west Africa, the German Government took over control from the German East Africa Company. Tanganyika was occu- pied by the British following a military campaign during the First World War, and in 1920 the peace treaty with Germany provided for its adminis- tration by the United Kingdom under Iandate from the League of Nations. In 1946 Tanganyika became a U. N. Trust Territory under British adminid stia

18. The territory is administered under the British Colonial Office by a Governor appointed by the United Kingdom. Territorial legislation is enacted by the Governor with the advice and consent of a Legislative - 7 -

Council which has full legislative and budgetary competence. The compo- sition of the Legislative Council, which consists of nominated, ex officio and elected members, has undergone several changes in the course of the trusteeship, moving gradually in the direction of greater African partici- pation, in pursuance of the general principles of the Trusteeship Agree- ment. Under the present Constitution, introduced in 1955, the Legislative Council consists of 34 members appointed by the Governor (including ex officio members) and 33 elected members. The representative side is com- posed of equal numbers of Africans, Asians and Europeans (one of each race appointed to represent each political division and one of each race repre- senting such interests as the Governor may see fit). This system replaced an arrangement under which the representative side consisted of seven Europeans, four Africans and three Asians. The formula of racial parity for elected members is accompanied by an electoral law which, in addition to providing for a common roll with a qualitative franchise, provides that each voter is required to vote for three candidates, one of each race (except where the seat is uncontested), In the first territory-wide elec- tions held in 1958 and early 1959 under the existing Constitution, the total number of registered voters of all races was only 58,000. All the successful non-African candidates who were opposed in the first elections held in September 1958 were formally su.ported by the Tanganyika African National Union, the dominant African political party, which has no serious competitors at present.

19. The question of further constitutional development is a major issue in the political life of the territory. No definite timetable has been established for the further constitutional development of Tanganyika, but during 1959 a committee of the Legislative Council is to consider possible further constitutional development, and its terms of reference will include a review of the parity system as well as the broadening of the franchise. The United Nations Trusteeship Council in its most recent report on the territory (A/3822, 1958) stated:

"...The Administration has described as its eventual aim the establishment of a multi-racial society possessing multi- racial, or in effect, non-racial institutions of government. At the present stage of the evolution of the Territory, how- ever, the constitutional structure reflects a special impor- tance attached by the Administering Authority to the non- African groups in terms not of their numbers but of their contribution to economic and other development...The concern of the Trusteeship Council has been that this system of separate representation should be regarded by the Adminis- tering Authority as merely a transitional phase in the Ter- ritory's evolution towards an integral society in which Africans would play their due part."

An address by the Governor at the October 1958 meeting of the Legislative Council included the following statement:

"In terms of population the Africans are and always will be an overwhelming majority in Tanganyika and, as the country progresses, it is right and proper, as indeed it is natural - 8 -

and inevitable, that African participation both in the legislature and in the executive should steadily increase. It is not intended, and never has been intended, that parity should be a permanent feature of the Tanganyika scene. On the other hand, it is intended, and always has been intended, that the fact that when self-government is eventually attained both the Legislature and the Govern- ment are likely to be predominantly African should in no way affect the security of the rights and interests of those minority communities who have made their homes in Tanganyika. I am glad to note that the responsible leaders of major political parties in the Territory are in complete agreement on this important matter; and that there is there- fore a good prospect that in due course there will exist in Tanganyika a government to which Her Majesty's Government will be able to devolve their trust as being a government under which responsible people of all races would feel secure."

In response to this statement, Mr. Julius Nyerere, President of the Tan- ganyika Africa National Union (TANU) made a statement in the Council as Chairman of the newly formed Tanganyika Elected Members Organization which contained the following:

"This statement we have-been waiting for for a long time because it has implications, because once you have made this statement you remove the fears of the Africans; you throw a responsibility to them, and it is important that the Africans should feel that responsibility and take the necessary responsible attitude that is expected of them and which cannot be expected-of them unless the position is made clear by the Government of the country ... I recommend this statement to all sections of the com- munity in this country. It means a great deal for our future."

A further step in constitutional development was taken recently when the Governor appointed several elected members, including three Africans, to full Ministerial rank in the Cabinet.

East African High Commission

20. The governments of the three territories of British East Africa are entirely separate, but they all participate in the East African High Commission, established in 1948, which is a body designed to coordinate and centralize certain activities which pertain to all three territories. The Commission provides certain universal administrative services for the three territories, including railways and harbor facilities, post and telecommunications, agricultural and forestry research, industrial reseaich, statiatics, and the administration of the customs and excise system (common to the three territories) and the income tax.- The -9-

expenditures of the High Commission (excluding the self-contained opera- tions of the railways and harbors administration and the posts and tele- communications system) have been rising steadily and in 1957 amounted to approximately £5 million, the cost being shared among the three ter- ritories and the United Kingdom.

Local Administration

21. For administrative purposes the territory is divided into 8 prov- inces which are in turn divided into districts under the supervision of an appointed District Commissioner. The principal organ of local govern- ment throughout most of the rural areas is the native authority consist- ing of chiefs with, in many cases, elected councils; in urban areas it is the multi-racial town or municipal council. The development of modern local government has thus far been limited and the policy of indirect rule (through African tribal or native authority) continues to dominate. In the case of urban areas, progress has been made with the establishment of 9 town councils by 1957 and a tenth was to be established in July 1958. In the rural areas where only one County Council has been set up, progress has been slower.

22. There are at present 390 native authorities, combined for financial purposes into 56 native treasuries; during l9g8 these collected revenues totaling over £2,000,000, The control and direction of the native author- ities lies in the influence of the provincial commissioners who delegate much of their responsibility to the district commissioners. The provincial commissioners regulate native authorities subject to the Central Government and have a voice in more important issues. They approve the native treas- ury estimates and are responsible for the appropriate functioning of the local courts and other essential services. They or the district commis- sioners normally supply most of the initiative on which much of the legis- lative action of the native authorities is based.

Civil Service

23. The day-to-day conduct of Government is carried out by a non-racial Civil Service consisting of some 2,800 Europeans, 1,500 Asians and approxi- mately 23,000 Africans, many of whom are in subordinate positions though every effort is made to fit them for greater responsibility as and when possible. There were expected to be at the end of 1958 6 or 7 African district officers and, subject to budgetary provisions, 46 African assis- tant district officers. A substantial effort is being made to train Africans for the Civil Service. Training facilities have been substan- tially increased recently and a government scholarship fund has been established, the resources of which are such that at present the number of scholarships is linited only by the number of students qualified to proceed with higher education. The number of government employees in pre-service and in-service training was expected to increase from 2,800 in 1957 to about 4,000 in 1958. - 10 -

CHAPTER II. TEE ECONUMlY - STRUCTJRE AND GROWTH

HISTORICAL

1. The modern economic history of Tanganyika dates back to 1884 when the German, Karl Peters, founded the UJnion for German Colonization. Before that date, the principal exports of the territory were ivory and slaves. In the thirty years preceding the outbreak of the first Wgorld War the Germans devoted much money and energy to the development of plan- tation agriculture, introducing not only sisal, but also coffee, tea, cotton, rubber and cinchona, and experimenting with many other crops. They built two railways, one from Tanga to Moshi in the north and the other from Dar es Salaam to Kigoma in the center of the territory.

2. During the first world war, the course of events in Tanganyika was interrupted by fighting. In 1919 a mandate was given to the United Kingdom to administer the terri$.ry. The history of the subsequent years has been summarized as follows:v

...1920-1924 was a necessary period of consolidation after the disruptions of the war. Then in 1925-1929 there was a period of rapid expansion, reflected not only in expansion of the budget, but also in optimistic, sometimes over- optimistic, private investment. By the Autumn of 1930 the cold winds of the depression were starting to blow in Tan- ganyika, and it was not until 1934 that the country's baro- meter started again to rise. From 1935 to 1939 Tanganyika experienced a period of great uncertainty, during which in spite of public assurances given both locaLly and in the United Kingdom, the impression was abroad that the territory was being used as a political pawn, wTith the result that public and private investment were both hesitant.

"...before the outbreak of war, and in part as a substantial gesture of official confidence in the future of the territory, a Development Plan... wa s7 initiated..." (ibid). Execution of the plan was, however, prevented by the war.

3. In spite of difficulties, efforts were made between the wars to increase African production of cash crops. In the 'twenties, these ef- forts were concentrated on the encouragement of cotton growing, parti- cularly in the Lake Victoria Basinand the eastern districts of the ter- ritory. At the same time the Chagga rapidly increased their numbers of Arabica coffee trees, and the crop of Robusta in the Bukoba district increased. During the depression, the policy was to encourage a larger lJ J. P. Moffett, Handbook of Tanganyika (Second Edition, 1958) p. 89. - 11 - volume of production of export crops in order to offset the fal1 in price.

4. The first gold mine in the territory, the Sekenke Mine, began pro- duction in 1909. Other gold discoveries were made under the Germans. In the 'twenties alluvial gold was found, and also diamonds. In subsequent years there was a steady expansion of gold mining. Diamond production fell off to a very low figure until Williamson's discovery of the Mwadui diamond field in 1940. In 1938 the deposit subsequently worked by the Mpanda Lead Mine was discovered.

5. The mileage of roads "passable to light motor traffic in the dry season" increased from 2,650 in 1921 to nearly 12,000 in 1938. The lat- ter figure, however, included some 4,000 miles of roads maintained by native authorities, generally to a poor standard, and passable only in dry weather. The second World 'Aar, which held up most forms of develop- ment, gave some impetus to the construction of roads considered to be of strategic importance. Railway building between the wars was limited. A new line was built from Tabora to Miwanza on Lake Victoria, a distance of 237 miles. The extension of the Tanga line from Moshi to Arusha (54 miles) was completed in 1929. A branch line from 'Nianyoni on the Central Line to Kinyangiri (93 miles), opened in 1934, was an economic failure, and after the second World War the track was torn up and used for the new line to Mpanda.

6. From 1925 the administration set to work to introduce "indirect rule" on the Nigerian pattern, thus undoing the German system, which in places went as far as the replacement of the chiefs by Arabs or others of alien origin. The British revived the authority of the chiefs, and encouraged the establishment of native treasuries and native courts in which the local customary law was administered.

7. The pace of economic advance was considerably accelerated in the years following the second World War. Between 1948 and 1952, Tangan- yika's exports increased in volume at an average rate of 17% p.a. For most products, pre-war export quantities were rapidly exceeded, and cer- tain new crops began to make an appreciable contribution to export earn- ings. Since 1952, Tanganyika has maintained the level of its export earnings rather well, further increases of quantities offsetting the fall in prices from their Korean levels. However, the expansion of export volume has been slower and more irregular than in earlier years. The continued development of the economy has come to rely more heavily on public efforts as the stimulus of lively export demand has decreased. - 12 -

NATIONAL FRODUCT AND ITS COMPOSITION

Monetary economy and subsistence sector

8e The gross domestic product of the monetary economy in Tanganyika is estimated at just over f92 million, at factor cost, in 1957. About 467,000 persons in the territory are reckoned as having been gainfully employed in 1957: 430,500 Africans, 10,300 Europeans and 26,300 Asians, Arabs etc. The product of the monetary economy is thus estimated at about f200 per person gainfully employed.21

9. Africans listed as gainfully employed amount to less than 10% of the total African population aged 16 and over (4.8 million in 1957)e Thus even allowing for the place of cash crops in African agriculture, the great majority of the population remain in the "subsistence sector". However, in practice no clear line can be drawn between the subsistence sector and the monetary economy, since many of the inhabitants perform some cash transactions while relying largely for their livelihood on sub- sistence production, and since African producers of cash crops usually also grow all or a large part of their basic diet.

10. Estimation of per capita product outside the monetary economy pre- sents very great difficulties of definition and of valuation. The main tables of the national accounts for Tanganyika prepared by the East African Statistical Department include, for 1957, an allowance of some f 53 million for production outside the monetary economy which can be assessed with a fair degree of accuracy. Such important activities as hut building and beer making are excluded from this estimate. A supple- mentary estimate, not included in the main tables, allows a further 217 million for these and various other activities, estimates for which can only be "reasoned guesses"; and it appears that even this supplementary estimate conforms to a somewhat restricted definition of economic activity in the subsistence sector. It is therefore necessary to turn to quali- tative evidence for an impression of the level of activity outside the monetary economy. Because of the difficulties of putting appropriate figures to the product of the territory outside the monetary economy, this section will use for the most part figures referring to the monetary economy only, since these have a definite meaning in terms of actual trans- actions.

Industrial origin of domestic product

11. About half of the total gross domestic product of Tanganyika (in- cluding subsistence) is contributed by agriculture and roughly another 10% by livestock products - see Tables 6a, b and c. Even in the monetary economy, agriculture contributes over one-third of the total product, and livestock products a further 4-5%. Manufacturing is estimated to have contributed over 5% of the total product of the monetary sector in 1957 for the first time, and mining and quarrying accounted for only a slightly higher proportion in the years 1954-57. In relation to the official esti- mate on the basis including the widest coverage of subsistence activities - see Table 6c - manufacturing (including the important item of African

1/ This figure is an exaggeration, since it does not make allowance for the fact that a substantial part of the monetary product is Droduced by African farmers not classified as "gainfully employed". - 13 -

beer-making) is put at about 6% of the total product, and mining and quarrying at about 3%. The relative importance of other activities is indicated in Tables 6a, b and c. Table 6c is designed to show the extent to which the apparent relative importance of different activities is affected by the coverage adopted for activities outside the monetary economy.

Rate of growth

12. Gross domestic product on the official definition (including, as to 36%, activity outside the monetary economy), is estimated to have in- creased by roughly 2% p,a. in real terms from 1954 to 1957, a rate of in- crease somewhat higher than that of population (Budget Speech of the Minister for Finance and Economics, May 7, 1958). The rate of increase in the monetary economy may be presumed to have been somewhat faster.

13. Various more limited indicators of the rate of growth of the economy are available. One such indicator is the export volume index. Since ex- ports are equivalent to around 45% of the gross product of the money economy this indicator is of considerable significance. Between 1948 and 1952, the volume of exports increased at an average rate of 17% p.a. This high rate of increase probably reflects first post-war recovery and sub- sequently the stimulus of the Korean Boom. Since 1952 the increase of export volume has been uneven (c.f. Table 12 and Diagram 1). Percentage changes from year to year have been:

1952-53 -4.9 1953-54 +5.1 1954-55 +11.1 1955-56 +16.3 1956-57 -5.9

The development of production of the principal cash crops is shown by Table 20. Certain of these crops - notably sugar and wheat - are produced for the local market rather than for export. Finally, Table 21 shows various other indicators of the rate of development of the economy.

Share of general government in the economy

14. General government consumption increased from 14.1% of gross domes- tic product in the monetary economy in 1954 to 16.7% in 1957. When general government capital formation is added, the share of total govern- ment expenditures in the gross product of the monetary econcmy increased from about 20% in 1954 to about 24% in 1957. In fact, the increase of general government expenditures from 1954-1957 amounted to 46% of the increase of gross domestic product in the monetary economy at current market prices. The increase of govermment expenditures in relation to the total size of the monetary economy has contributed to the territory's growing budgetary difficulties, which are discussed in Chapter III below. CAPITAL FORiATION

Capital formation in relation to gross product

15. In the period 1954-1957, gross domestic fixed capital formation in the monetary economy was in the range 22-26% of the gross domestic pro- duct of the monetary economy - c.f. Table 8b. Table 8a puts capital for- mation at 15-17% of gross domestic product as a whole, but this lower ratio is influenced by the somewhat arbitrary coverage accorded to economic activity outside the monetary economy: e.g., African hut building is not covered by Table 8a. Since the impression which may be given of the im- portance of capital formation outside the monetary economy depends very largely on the definitions used, the following paragraphs will concentrate on capital formation within the monetary economy. 97% of the capital for- mation recorded in Tables 7, 8a, 9a, and 9b is in the monetary economy, 3% only being building and construction outside the monetary economy.

Public and private

16. Rather more than half of fixed capital formation in the monetary economy in 1954-1957 was private. Public capital formation was about evenly divided between general government and government enterprises in 1954 and 1955: but, while fixed capital formation of government enter- prises declined from f5.1 million in 1954 to 22.1 million in 1957, that of general government increased over the same period from f5.1 million to f7.4 million.

Capital formation by industrial use

17. The industrial distribution of fixed capital formation is indi- cated by Tables 9a and 9b. However, these tables do not give a fully satisfactory picture, since they include the bulk of government capital formation under the misleading head "Public administration and defense" and do not show its true allocation between different types of activity. This allocation is discussed in Chapter III below.

18. Tables 9a and 9b nevertheless serve to show:

the relatively small magnitude of private investment in agri- culture; the relatively large amount of investment in transport, storage and communications; however, investment in these activities fell off in 1956 and 1957; the importance in the economy of construction of dwell- ings.

Capital formation and imports

19. Over the two years 1956 and 1957, capital goods are estimated to have amounted to some 22% of Tanganyika's retained imports. In this two- year period, imported capital goods made up 35% of gross capital formation. - 15 -

Investment in stocks

20. The national accounts figures do not provide estimates of invest- ment in stocks, although this item may well amount on the average of several years to 2% or more of G.N.P. in a developing economy. It is believed that a part of the large imports in 1955 was due to stocking-up during the Middle Eastern crisis. In the supply and use of resources table (Table 7) this increase of supply is shown as offset by an increase of demand for private consumption. Thus it seems likely that the high private consumption figure for 1955 (71% of the gross domestic product of the monetary sector - c.f. Table 8b) is spurious, reflecting invest- ment in stocks. Similarly, the below-average figure for private con- sumption in 1956 may be influenced by the offsetting against consumption proper of some drawing down of stocks.

EXTERNAL TRADE AND PAYMENTS

Place of trade in the economy

21. In the years 1954-57, exports took around 31% of the total re- sources coming into the monetary economy of Tanganyika - gross domestic product plus imports. The following figures situate the place of imports in the economy. 1956 1957 Non-government imports of consumers' goods, food, drink and tobacco as percentage of private con- sumption expenditure 22 21

Imports of capital goods as percentage of gross fixed investment expenditures 38 33

Imports of producers' materials, spares and accessories as percentage of gross domestic monetary product 13 15

Exports-commodity composition

22. The exports of Tanganyika are much more diversified than those of most other countries or territories of a comparable level of development c.f. Table 11. The drop in sisal prices in the last few years has con- tributed to a fall in the share of sisal in total export earnings to under a quarter in 1956 and 1957. In these two years, coffee accounted for 19% by value of exports to destinations outside East Africa and cotton for 17%. Thus in 1956 and 1957 sisal, coffee and cotton together con- tributed 60% of Tanganyika's export earnings from the world outside East Africa. The evolution over time of the share in Tanganyika's exports of these three commodities is shown by Diagram 2.

23. Fourth place in export value is taken by diamonds. Another mineral which has come to make an important contribution to export earnings in - 16 - recent years is lead ore and concentrates - average fl.2 million in 1956-57.

2h. Pyrethrunm, castor seed, groundnuts and cashew nuts are all crops recently introduced into African farming in Tanganyika and already mak- ing appreciable contributions to export earnings - see Tables 11 and 12.

Exports - value, volume and price

25. The total export earnings of Tanganyika rose to a peak of f48.3 million in 1952, helped by record price levels - c.f. Table 10 and 1?iagram 1. The 1952 export value was however, narrowly surpassed in 1956,2/ further increase of export volume having outweighed declines of price. On the evidence of figures for the first ten months of the year, 1958 ex- ports seem likely to total about f45.5 million, against £43.1 million in 1957.

26. As has been seen above (para. 13), the increase in the volume of exports since 1952 has been irregular. Prices of commodities exported by Tanganyika have moved generally downwards over the past few years, al- though the decline in sisal prices appears to have been arrested since 1957 - see Table 13.

Imports - value, volume and price

27. Total imports into Tanganyika reached a peak value of £49.1 mil- lion (c.i.f.) in 1955, when they were swollen by stocking-up during the Middle Eastern crisis. They declined to f42.2 million in 1956, rose again to El'.7.0 million in 1957, but appear to have fallen off rather sharply in 1958.

28. No volume and price indices are available for Tanganyika's im- ports. However, there exists a unit value index for the imports of Tan- ganyika, Kenya and Uganda combined. In Table 10 it has been assumed that this price index is roughly applicable to Tanganyika, and it has been used to deflate value figures so as to gain a rough impression of the evolution of the volume of Tanganyika's imports. It must be stressed that this procedure is very rough. From 1954-57 the price level of East African imports changed fairly little, being considerably lower than the level of the immediately preceding years but somewhat higher than that of 1950. Import volume seems to have fluctuated around a generally in- creasing trend: but, as in the case of exports, the year-to-year fluc- tuations make it virtually impossible to identify the strength of the underlying trend - see Table 10.

/ Value line in Diagram 4 refers to domestic exports to destinations outside East Africa. These remained somewhat less in value in 1956 than in 1952. - 17 -

Imports - commodity composition

29. Table 14 shows the commodity composition of retained imports (im- ports less re-exports) in 1956-57. In these years, manufactured goods made up 75% of all imports. Fuels, lubricants etc. amounting to a further 8% and food, beverages and tobacco to just under 8%. Among food imports, sugar is the most important item, and wheat flour is also important. This latter is needed to make up a shortage of hard wheat caused by rust.

30. Classified in another way, capital goods accounted for some 22% of retained imports, producerst materials, including feeding stuffs for animals, for some 34% and consumers' goods other than food, beverages and tobacco for just over 29%. Government took 12% of retained imports, about 77% of government imports over the two years being equally divided between capital goods and producers' materials.

Geographical distribution of trade

31. As might be expected, the United Kingdom is Tanganyika's largest single trading partner. In recent years it has been more important, relatively speaking, as a supplier than as a customer: in 1956 and 1957 the United Kingdom supplied over 30% of Tanganyika's imports by value, but took just under 30% of Tanganyika's exports. These proportions are smaller than those for previous years, there having been a tendency for the share of the United Kingdom in Tanganyika's total trade to decline - c.f. Table 15.

Certain other sterling countries, and notably India and Australia, are important customers for Tanganyika's exports. Exports to Hong Kong have grown to around 22 million a year from 1955. India and South Africa are prominent amongst sources of imports. There is also a considerable volume of trade between Tanganyika and its neighbors, Kenya and Uganda, which supply (1956-57) over 15% of Tanganyika's imports though they ab- sorb less than 5% of its exports. The nature of this trade will be brief- ly described below (para. 33). In all, other sterling countries have taken in recent years around 55% of Tanganyika's exports and have provided considerably over 60% of its imports.

Non-sterling O.E.E.C. countries have grown in importance as trad- ing partners of Tanganyika, taking around 30% of its exports in 1956-57 and supplying around 15% of its imports.

Exports to the United States and Canada reached a peak in 1952, and fell off to around 9% of the total in 1956-57. In recent years, only just above 2% of imports have been taken from the United States and Canada.

In recent years, Japan has become a major customer, and it is even more prominent as a source of imports.

32. The main recipients of Tanganyika's exports are listed in order in Table 16, which also shows the commodities which constitute their major - 18 - purchases from Tanganyika. Most of Tanganyika's major exports go to a fairly wide variety of destinations - see Table 17 - but the whole of diamond exports are consigned to the United Kingdom and 99% of cashew nuts go to India.

Trade with Kenya and Uganda

33. Tanganyika imports from Kenya and Uganda considerably more than it exports to them for their own use (see Table 10, figures for "inter- territorial" trade). Tanganyika's exports in this trade consist largely of primary products, although they include some canned meat and meat preparations and prepared paints. Imports, by contrast, consist to a great extent of manufactured goods, cigarettes accounting for over 40% of the total, and beer, wheat flour, clothing and footwear also being important. The principal components of this trade are indicated by Table 18.

Balance of payments

34. On the average of recent years, Tanganyika's export earnings have been sufficient to cover the cost of imports plus freight and insurance thereon. Since 1950, there have been deficits on merchandise trade only in 1955, the year of exceptional imports, and 1957 (see Table 10).

35. Complete balance of payments figures do not at present exist for Tanganyika as a separate entity. The U.N. Visiting Mission of 1957 sug- gested "...that it would be desirable to keep under review the balance of payments and...that the statistics for this purpose be compiled in the future". Observation of the Administering Authority: "The Admini- stering Authority agrees that such figures would be most useful and it will consider the possibility of compiling such figures. There are, how- ever, practical difficulties which arise from the fact that the organi- zation of banking and commerce in the area is on an East African rather than on a territorial basis. Moreover there are other statistics such as better estimates of subsistence agricultural production and informa- tion regarding the pattern and movement of trade within Tanganyika, which are not yet available and which in the view of the Administering Author- ity are of greater importance at the present time. The Administering Authority believes that in present circumstances and having regard to the limited resources available to the East African Statistical Department it would be preferable to attempt a compilation of these other figures before embarking upon an exercise designed to produce balance-of-pay- ments figures...". In 1958 the East African Statistical Department pub- lished an estimate of the balance of payments for East Africa as a whole in 1956. This compilation identifies certain elements of Tanganyika's balance of payments with the world outside East Africa, but not, of course, of its balance of payments with Kenya and Uganda. The fragmen- tary information available from this and other sources is set out in Table 19.

36. It cannot be too strongly stressed that the items recorded in - 19 -

Table 19 are an arbitrary selection from a much wider range of trans- actions which must have taken place in practice. The figures shown indicate a surplus on visible trade, supplemented by Colonial Develop- ment and Welfare grants. The offsetting debit items shown are relative- ly small. And yet public authorities are shown as selling portfolio securities net and increasing their overdrafts in respect of the Joint Consolidated Fund and Joint Miscellaneous Fund. It follows that other transactions, not shown in Table 19, must have given rise to debits totalling £9.5 million. These transactions may include notably:

payments to the commercial centre of Nairobi and to London for miscellaneous services; interest and dividend payments by private enterprises and persons; net debits in respect of travel; investment outside the territory and repatriation of sav- ings by private enterprises and persons.

Private investment by the outside world in Tanganyika appears to have taken the form in recent years largely of reinvestment of profits of ex- ternally-owned enterprises operating in the territory. Such investment should appear in the balance of payments as a capital inflow offset by an equal outflow in respect of interest and dividends. It would there- fore not affect the size of the residual item (unidentified net payments to the outside world) appearing in Table 19.

37. The Miission will have to consider whether it is necessary to try to secure estimates for the most important missing components of Tangan- yika's balance of payments.

Tariffs and other regulations governing trade and payments

38. Tanganyika, Kenya and Uganda form a customs union. The import tariff is considered to be primarily a revenue producing and not a pro- tective measure. The general rate is 22%. Higher rates up to 60% are levied on a number of luxury goods and lower rates on items considered more essential. There is a considerable free list covering machinery an( plant and various agricultural and industrial materials.

39. Some quantitative restrictions remain on dollar and other non- sterling?7 imports, though such restrictions have been progressively re- laxed in recent years. They effect the geographical distribution rather than the total value of trade. - 20 -

AGRICULTURE

General Features

4o. Agriculture, accounting for roughly half of the gross domestic product, is the mainstay of the economic life of Tanganyika. The over- whelming majority of the African population are entirely or predominantly subsistence farmers and about 80% of the acreage cultivated by Africans is devoted to food production largely for subsistence consumption. In the subsistence sector maize, millets and sorghums occupy the largest acreage and cassava, sweet potatoes and bananas produce the largest ton- nage. Root crops are grown as a famine reserve, since corn and bananas are severely affected by drought. Most livestock production is also carried out in the subsistence sector.

41. The main cash crops are sisal, cotton and coffee, but six or seven other crops are of increasing importance, including cashew nuts, ground- nuts (peanuts), tea, castor seed, sunflower seed and tobacco (in inter- territorial trade). Since the end of the war, the production of all the main cash crops, under the impetus of favorable prices, has undergone a long-term expansion (see Table 20). The most significant gains between 1947 and 1956 were recorded by sisal (76%) and cotton (232%), but large gains were also made by crops of lesser importance such as tea, tobacco, cashew nuts, castor seeds and other oilseeds. Exports of maize and pulses have also been of some importance in inter-territorial trade with Kenya and Uganda, with considerable year-to-year fluctuations. A sizable por- tion of grains (mainly maize, wheat and rice) enters the monetary economy for local consumption.

42. Both Africans and non-Africans are engaged in the production of cash crops. About 2.5 million acres have been alienated for non-African holdings, mostly under long-term lease, the only form of alienation pre- sently permitted. This represents about 1.6% of the total land area of the territory "available and suitable" for agricultural and pastoral pur- poses, or 5% of the land being used for arable purposes at the present time. About 700,000 acres of this alienated landare under cultivation for cash crops, principally sisal and secondly coffee and tea. The main cash crops produced by Africans are cotton, coffee, groundnuts, coconuts, sesame, cashew nuts and soybeans - the largest acreage being devoted to cotton. The value of African production of cash crops now exceeds that of non-African due to the decline in sisal prices and the growth of African-produced coffee and cotton.

43. Tanganyika is largely self-sufficient in agricultural products; food imports accounted for 6% of total imports in 1957, sugar being the main food imported (one-third), followed by dairy products, vegetable oils, processed fruits and vegetables and small quantities of a wide variety of other products. Sugar production has been increasing and new projects are expected to satisfy donestic requirements and possibly leave some surplus for export. - 21 -

Cash Crops

44. Sisal 1/Over the past thirty or forty years, by far the most impor- tant cash crop has been sisal, and the economy of the territory has been bound up with the fortunes of the sisal industry. Sisal remains the largest single export, but, as shown in Table 11, its relative importance has diminished sharply during the post-war period, particularly during the last seven or eight years. If comparison is based on 1949-50, thus largely eliminating the distortion in the pattern of exports caused by soaring sisal prices during the Korean commodity boom, the share of sisal in total exports by 1957 had dropped from about 50% to 24%. The volume of sisal exports increased by half during this period, but the value actually fell slightly, owing to lower prices. (The value of sisal ex- ports is now less than half that of the boom years of 1951 and 1952.) During the same period the volume and value of other agricultural exports - especially coffee and cotton - rose steadily, and the commencement of large-scale diamond exports has further diminished the relative importance of sisal. 45. 6ial was first. introduced by the Germans in 1892 in an effort to develop a drought-resistant crop suited to conditions in the Tanga prov- ince in the northeast, where roughly 60% of production is located. It is grown almost entirely by non-Africans under intensive cultivation on large estates, about 70 of which account for four-fifths of total output. As cultivated in Tanganyika, the capital requirements for efficient sisal production are high; the total capital invested in the industry is esti- mated to be at least £20 million, by far the greater part of which has been obtained by reinvesting a substantial portion of profits. The indus- try employs over 133,000 African workers, more than a third of all those working for wages, and its contribution to governmental revenue (parti- cularly through the income tax on companies) is of major importance. Thus, despite its reduced importance, the territory's economic outlook remains heavily dependent on the prospects for sisal.

46. The rapid growth of sisal output in Tanganyika since the last war and the countryts position as the largest producer of sisal in the world are indicated in the following table: 1935-38 1948 1956 1957 (Annual average) Africa Tanganyika 90,000 121,000 186,000 185,000 Kenya & Uganda 33,000 36,000 40,000 41,000 Mozambique & Angola 27,000 34,000 65,000 71,000 French Africa & Madagascar 7,000 4,000 17,000 159000 African Total 157,000 195,000 308,000 312,000 Indonesia 90,000 5,000 35,000 32,000 Brazil - 25,000 100,000 115,000 Haiti & Central American Countries 6,ooo 31,000 43,000 36,000 Total 253,000 256,000 486,000 495,000 This section draws heavily on a recent book by C.W. Guillebaud, An Economic Survey of the Sisal Indtstry of Tanganyika, 1958, prepared under the auspices of the Tanganyika Sisal Growers Association. - 22 ^

47. The market position of sisal is complicated by the fact that in several important uses, such as twine, it competes against other hard fibres, namely Manila hemp and henequen. It is significant, however, that whereas sisal represented only about 16% of the world's output of hard fibres in the early 1920's, it now accounts for two-thirds of the world's supply. The most important uses for sisal fibre are for making ropes and other forms of cordage, particularly agricultural twine, but it is also used as an upholstery material for automobiles, furniture and mat- tresses, and research is being carried on to extend its consumption to other non-agricultural uses. The expanded demand for sisal has depended heavily on the long-term growth of mechanized agriculture, which has pro- vided the main outlets for the commodity in the form of binder and baler twine. During the post-war period the spread of the combine harvester, displacing the reaper and binder, has been unfavorable to the demand for binder twine, but this trend has been outweighed by the rapidly growing demand for baler twine used in the mechanical baling of hay and silage. In general, it seems reasonable to expect a continued long-term growth in the demand for sisal, based largely on the expansion of world agri- cultural output, but this is not one of the more rapidly growing sectors of world production and the growth of demand might well be less rapid than in the 1950's.

48. - The recent rapid growth in world sisal output has been the main factor contributing to the weakness in the price of sisal which has persisted since the end of the Korean boom. The growth of sisal output in Brazil has been an important new factor affecting the supply position; in 1958 concern over Brazilian competition reached the point where informal overtures were made by the Tanganyika growers concerning the possibility of an agreed curtailment of output. An increase of low-priced henequen twine exports ftom Mexico to the United States has also contributed. Sisal prices did not recover along with other commodity prices following the post- Korean collapse of commodity markets. During the past two or three years, while commodity prices weakened generally the price of sisal continued to decline, though in recent months this trend seems to have come to a halt.

49. In the recent analysis prepared by Mr. C.W. Guillebaud for the Tanganyika Sisal Growers Association it is suggested that the present low price (and other factors) may accelerate the decline in Indonesian supplies and, more important, discourage Brazilian production. A number of Tanganyikan sisal estates have begun to incur losses, and no new expan- sion of capacity has been undertaken in the last two or three years in Tanganyika. With regard to the longer-term outlook in Tanganyika, Mr. Guillebaud's appraisal is as follows:

"...it would seem that there are no longer any consider- able areas of new land suitable for sisal cultivation which can be made available for this purpose in Tangan- yika. In some of the older areas there is evidence of soil exhaustion and diminishing returns; and it is by no means clear, either technically or economically, that it will be practicable to counteract this tendency by the application of fertilisers on a large scale. The present indications are that the phase of continuous and rapid growth of the output of sisal in Tanganyika has come to an end and would not be likely to recur even if there were to be a marked rise in the price of sisal." 1/ / Op.cit., p. 12 - 23 -

50. Cotton The production of cotton has experienced a particularly rapid growth. In 1938 production was estimated at under 8,000 tons, and this figure was roughly maintained until 1954 when production jumped to 18,300 tons. Recent output has been in the range of 20-23,000 tons. There seems to be considerable doubt whether the spectacular recent rate of growth will be maintained, particularly in the densely populated Lake Provinces, the main area of production. A substantial long-term expansion is, however, expected in the Eastern Province where a new variety of seed has been introduced.

51. All the cotton produced in Tanganyika is of the American upland type (short staple). Production is carried on entirely by African farmers on small plots averaging about l2 acres. Both contract tractor plowing and animal-drawn plows, as well as hoes, are used in preparing the ground for planting. Governmental measures have been taken to improve the qual- ity of seeds and to encourage efficient cultivation, but the increase in output has come mainly from larger acreage. A statutory marketing board (the Tanganyika Lint and Cottonseed Board) fixes purchase prices on a seasonal basis, but - unlike marketing boards in certain other African territories - does not attempt to insulate the domestic price from fluc- tuating world prices through its operations. About 60% of production is purchased by African cooperatives, but most of the ginning is done privately. 52. Coffee The production of coffee, Tanganyika's third most valua- ble cash crop, has been increasing steadily but more slowly than that of cotton and sisal. About one-fifth is produced by European growers and the remainder by African growers, principally around Mount Kilimanjaro (Arabica type) and in the Bukoba District in the west side of Lake Victoria (Robusta type). African Arabica production is also expanding rapidly in southwest Tanganyika. Total production is about equally divided between Robusta and Arabica.

53. Other Cash Crops Most of the post-war expansion of the other cash crops has come from African production, with the principal excep- tion of tea and tobacco. The increased output of oilseeds (especially castor seeds) and cashew nuts has been particularly striking. Tea, which is now sixth in value as an agricultural export, is rapidly in- creasing in importance and is entirely produced on non-African planta- tions in the Eastern and Usambara Mountains in the northeast and in the Southern Highlands Province. There is considerable area remaining for expansion. Production almost tripled between 1952 and 1957. Tobacco production, particularly the Virginia flue-cured type, is exported to Kenya and Uganda at present and is rapidly increasing. Production appears to be mainly in the hands of non-Africans but African coopera- tives have stimulated production of fire-cured tobacco and at Urambo where both African and European tenants of the Tanganyika Agricultural Corporation are successfully growing fire-cured tobacco. Sales of this crop have caused the elimination of imports from the United States by Kenya ($600,000 in 1956) and exports to areas outside East Africa have been increasing. Livestock

54. Tanganyika is estimated to have a cattle population of over 7 million head and a roughly equal number of sheep and goats. Apart from subsistence production, however, the livestock industry is thus far a small factor in the country's economy, and organized ranching or mixed farming is in its infancy. The potential scope for development of ani- mal husbandry is agreed to be great: there are hundreds of square miles of grasslands with adequate feeding capacity, and the prospective growth of export as well as local demand for livestock and dairying products makes this sector a natural one for a vigorous development effort. The obstacles to a rapid expansion in this sector are, however, formidable. The expansion of animal husbandry is immediately dependent on two factors: the elimination of the tsetse fly and the development of water supplies. In a few areas development has commenced with the aid of bush clearing and improved trypanocidal drugs, but measures to expand and obtain accept- ance of veterinary services and to provide water facilities are slow to develop, and the amounts allocated for this sector in the existing devel- opment plans, particularly for the provision of water, are modest. With respect to African participation in animal husbandry, an important factor in some areas seems to be the characteristic African attitude toward cattle as a sign of status and a famine reserve and frequent opposition to reducing the number of animals to the carrying capacity of the avail- able pasturage through a process of culling for sale. Thus, despite the vast potential range capacity, overstocking is a serious problem in the areas now devoted to cattle raising, particularly in the Lake, Northern and Central Provinces, and is contributing to soil erosion. The govern- ment, coimnenting on certain observations on the subject of destocking by the Uribed Nations 1957 Visiting Mission, stated that while destocking programs are still necessary in several areas, the emphasis is shifting to the opening up of new lands and improved pasture management as better solutions to the over-stocking problem than enforced sales, which have been attempted apparently with little success.

Agricultural Development

55. The above account, focused largely on the post-war expansion of the monetary sector of the agricultural economy under generally favorable price stimuli, presents a picture of largely autonomous agricultural growth which, in itself, is not unimpressive. It must, however, be placed in perspective against the basic poverty and stagnation of the subsistence economy on which the mass of the population for the most part continues to depend. Furthermore, productivity in the growing cash sector of the economy, except for sisal, is generally low even by African standards. Thus, in the famous African coffee area of the Chagga Tribe on Mount Kilimanjaro, the average yield of coffee is three bags to the acre as compared with ten per acre being produced on "integrated" African farms in Kenya. In a speech to the Legislative Council several years ago the - 25 -

Governor stated that according to the advice of experts there could be an increase in the production of coffee amounting to 50% without plant- ing a single extra tree, but that there was the lack of will to take the relatively simple steps needed to improve the culture of coffee.

56. Since the liquidation of the ill-fated Groundnut Scheme, planned and developed by the Colonial Office and the United Kingdom Overseas Food Corporation after the last-war, "capital-expenditure for the govern- ment's agricultural development program has been on a modest scale. Only about £200,000 of the £6 million proposed capital expenditure for devel- opment in 1958/59 is specifically for agriculture, though some of the moderate expenditures for water development and certain general develop- ment expenditure, for example on road construction, have indirectly assisted agriculture. "Current" expenditure on agricultural researchj veterinary services, and similar activities is more substantial, however, and combined capital and current expenditure on agriculture, forests and veterinary services in the proposed 1958/59 budget was £2.6 million.

57. Nearly all the large public agricultural development projects at the territorial level are being carried out under the direction of the Tanganyika Agricultural Corporation (a local government corporation created in 1954 as the successor to the Groundnut Scheme). At Nachingwea, Kongwa and Urambo, sites of the former Groundnut Scheme, the Corporation has been operating what are, in effect, three pilot projects. These con- sist mainly of a modest number of tenant farms worked mostly by Africans and, with some exceptions, have shown encouraging results. Among the crops being produced and marketed are groundnuts, maize, soybeans, sesame, sunflower seeds, castorbeans and flue-cured tobacco. At Kongwa the Cor- poration itself operates a successful cattle ranch.

58. The agricultural development program also includes a number of projects designed to increase African agricultural productivity through- out the territory. These include the expansion of agricultural extension services, the improvement of livestock routes, small-scale water develop- ment and pilot irrigation schemes, a plan to increase the productivity of the territory's forests, the establishment of veterinary disease and investigation centers, and the like. Bush-clearing schemes to combat tse-tse infestation by the method of discriminative and selective clear- ing have been pushed forward in many parts of the country. In particular, two important schemes are under way in the Lake Provinces which will clear the tse-tse fly from 500 square miles in northeastern Sukumaland and 400 square miles in the Korogwe district.

59. From the long-run point of view particular emphasis is being placed on the development of the Rufiji river basin. The Rufiji basin, which includes parts of the Southern Highlands Province, the Southern Province and the Eastern Province, covers an area of about 68,500 square miles - 20% of Tanganyika - and is the only large potential area for long-term agricultural, power and irrigation development in the territory. The area contains a variety of agricultural terrain: the higher valleys and mountains adjacent to the tobacco area of Iringa district in southern Tanganyika, lower valleys suitable for large-scale sugar development, - 26 - and delta lands on which moderate quantities of rice are being produced. For the past two and a half years a team of eleven FAO specialists work- ing in conjunction with the Tanganyika Agricultural Corporation has been making an intensive ground and aerial survey (including both geological and soil surveys) to determine the long-term potentialities for gradually developing individual areas. It has been estimated that from 300,000 to 1 million acres have potentialities for arable and tree crop production. A number of potential dam sites and reservoir areas have been surveyed. In 1958 a pilot irrigation scheme was established in the Mbeya district of the Southern Highlands Province. It is planned to extend this in due course to 5,000 acres, to be worked by African tenant farmers, which will represent the first large-scale irrigation scheme in Tanganyika. Apart from this none of the official development plans as yet provides for any large-scale agricultural development of the Rufiji basin in the form of dams, irrigation works, and the like.

60. An increase in African agricultural productivity is the primary object of the government's program of agricultural development. As ex- plained in the presentation of its Ten Year Development Plan, 1955-65 (See Appendix 1), the attainment of this goal calls for (i) a shift from subsistence agriculture to the production of cash crops and (ii) an increase in productivity within the monetary sector of agricultural production. As stated in the Plan,

"the need is to overcome the physical obstacles of environment and the human obstacle which is the suspicion and conservatism of the African farmer. The problems are technical, financial and not least administrative."

61. A substantial amount of work is going into agricultural research, land and water surveys and pilot schemes. The technical problems of agricultural development, while formidable, do not call for special com- ment here. The financial problems, which relate to the provision of resources devoted directly to agriculture and to financing of infrastruc- tural investment on water supplies, roads and the like are discussed in the following chapter. A few words, however, may be said here on the administrative problem, which - apart from the typical problem of pro- moting agricultural extension and other measures - centers around the question of land usage and land tenure.

Land Tenure

62. The problem of land tenure and land usage in Tanganyika arises from the prevailing pattern of customary land usage and from the changes that have been superimposed on this pattern by the gradual introduction of cash crops in many areas. The customary form of land usage is that of shifting cultivation which is traditionally associated with subsistence agriculture throughout East Africa. The system has undergone considerable evolution in recent years, but its essence has been described in the fol- lowing terms: - 27 "

"tA mental picture has to be formed of individual families within a clan, and of clans within a tribe, cutting out for themselves from the virgin bush small family holdings on which to plant their subsistence crops. The family herds grazed in common in the adjacent bush and on the stubbles but were not in any sense integrated with the cultivation or restricted in numbers to the carrying capacity of the land. When the soil showed signs of exhaustion by lower crop yields, the family cut out a new holding and the original one was left to revert to a bush fallow, making thus a rough rotation. Intercropping was sometimes practised with various pulses and cereals, and often the crops were scattered to take account of fertility variations and distribute the labour load. But to preserve the land, a long periodic fallow was in most places a neces- sity. It was a system well fitted to conditions of old when population, both human and animal, was kept low by disease, famine and warfare."

* * * ** ** * * *33 * ***

*~a * * *t * * .33 *

* .33* * .33.f * *3, * *~- - 28 -

The concept of property in land accompanying the system of customary usage is one in which land is regarded as a local clan trust, handed down by ancestors and passed on to descendants; individual property rights in land are thus excluded. W

63. Two closely related tendencies have led to increasingly serious problems within the system of customary usage. In the first place, the growth of population of both humans and livestock has tended in a number of areas in Tanganyika to lead to mounting pressure on the available land areas. The consequence is that an effective rotation of bush fal- low can no longer be continued, and holdings are split up into units of uneconomic size. The area of grazing is reduced by the extension of the cultivated area while, at the same time, the number of livestock increases. Overgrazing leads to soil erosion which in turn has serious effects on the catchment systems on which the water supply is based.

64. The second tendency is the gradual introduction of cash crops as an addition to the old subsistence farming, which has meant another in- crease in the demand for cultivable land. Output under these conditions is, of course, higher than under purely subsistence farming, but produc- tivity remains low and the same tendency sets in toward soil erosion and exhaustion. There are still large areas of unused cultivable land into which expansion is possible, but this offers no permanent solution and in the short run, furthermore, expansion is restricted by tribal bounda-- ries and by lack of water and other facilities. An incidental difficulty results from the fact that, despite the small portion of total area repre- sented by alienated land, the process of deterioration has been particu- larly rapid in the attractive mountainous areas adjacent to large tracts of alienated land, some of which are not presently under cultivation.

65. The methods by which to accomplish a changeover-from subsistence to economic farming without the undesirable consequences described above have occupied the attention of numerous investigations of which two are of particular importance, namely, (i) The East African Royal Commission, 1953-55 (1956, Cmd. 9475) and (ii) the recent report by the FAO on land tenure, referred to above (1959, T/1438), which was prepared by Mr. Arthur Gaitskell who was a member of the East African Royal Commission and for- merly Chairman of the Sudan Gezira Board. The Royal Commission urged that in order to provide effective incentives, policy concerning the tenure and disposition of land should aim at the individualization of land ownership and mobility in the transfer of land in order to enable the maximum free- dom of access to land for economic use. To this end it made a series of recommendations including the establishment of a procedure by which indi- vidual rights of land ownership would be confirmed by a process of adjud- tication and registration. The FAO report, taking a more eclectic view, contains the observation that "the enormous variations in Tanganyika in - 29 - soil, climate, water, tsetse, communication and sophistication make any dogmatic assertions Fabout new forms of land tenure and usage7 stupidly rash." It points out that pressure for increased productivity and the problem of getting people to move from overcrowded areas is bound to demand more attention to controlled planning of undeveloped land. One issue that may arise in the programing of agricultural development is a competition for funds between projects of this character and those aiming at a more general rise of agricultural productivity through agricultural extension and related activities.

66. The Tanganyika Government has continued to study the East African Royal Commission's recommendations on land tenure but has thus far re- frained from introducing any far-reaching proposals. A limited step was taken in 1958 with the publication of Government Paper No. 6 (Review of Land Tenure Policy, Part I), which presented to the Legislative Council for consideration the Government's proposed position on "land held under customary tenure in rural areas where occupation has so far developed that it is individual, exclusive, and unlimited in time." Briefly stated, the Government's proposal is that the Governor should have authority to convert customary land to freehold land and that he should exercise this authority in instances in which he and the individual landholders are convinced that to do so would serve the best interests of the landholders themselves and of Tanganyika. The object is to give legal sanction to the de facto proprietary rights which are emerging in the more advanced areas of the country. Concern over local reaction to radical changes in the system clearly has induced an attitude of caution on the part of the Government.

67. Tanganyika's representative recently informed the Trusteeship Coun- cil that the government's proposals should be regarded as preliminary pro- posals designed to secure a reaction from the African population. The Territorial Convention of Chiefs, he said, has welcomed these proposals in principle, but, in accordance with expectations, the proposals have met with different receptions in various localities. They have been wel- comed in areas where there are perennial crops and where there is a pres- sure of population on the land. In some of the more backward areas, how- ever, the view has been expressed that the people are not ready for such a change. He added that there are indications that some African politi- cians would prefer the grant of leasehold titles for individual holdings rather than freehold titles. An indication of the variety of views and positions on the land question within the African population itself is the fact that the African leader of the Opposition in the Legislative Council (Mr. Nyerere) in a recent debate on the Governmentts Paper No. 6 expressed doubt about the wisdom of adopting generally a system of indi- vidual proprietary rights and suggested that a system of national owner- ship might well prove better, in the light of world experience, at least in land not yet developed. - 30 -

TRANSPORT

Railways and Harbors

68. The basic railway system of Tanganyika was laid down by the German administration at the beginning of the century. It consists of two lines running east to west, the Central Line from Dar es Salaam to Lake Tangan- yika and the Tanga line to the Northern Province (see Map 1). The Central Line has two branches, one from Tabora to Mwanza on Lake Victoria, con- structed in the late 1920ts, and the other from Kaliuwa to Mpanda, con- structed during 1947-1950 to provide an outlet for the lead mine at Mpanda. On the Tanga Line the British built a short extension from Moshi to Arusha in the 19201s; the connection with the Kenya-Uganda system by way of Voi was built during the 1914-1918 War. A third line, also running from east to west, is the Southen Province Line from the Port of Mtwara to Nachin- gwea, a distance of 131 miles. This was built between 1947 and 1954 to open up the area around Nachingwea in connection with the Groundnut Scheme.

69. The system of railway communications is thus stratified horizontally, each line serving a belt of country stretching from a coast port to an in- land terminus. In his comment on the Royal Commission's report the Governor pointed out that

"...of the zones which have a 'fair prospectt of 30 inches of rainfall annually, none but the lake shores of Mwanza and Kigoma and the coastal areas served by the Tanga, Central and Southern Province lines is in actual contact with a railway. The much larger zones in the north-west and the south-west have to depend on long distance feeder roads some of which are still not up to all-weather standards."

The long-term objective of railway development is to build a north-south rail link across Tanganyika connecting the Tanga and Kenya-Uganda system with the Central Line and the latter with the Rhodesian system. In the short-run particular emphasis is placed on extending the Central Line from Morogoro toward the Kilombero Valley and subsequently into the Kilombero Valley itself. Details of the estimated costs are contained in the extract from the Ten-Year Development Plan, 1955-65, which appears in the Appendix. A special study of the potential link from the Central Line through the Kilombero Valley and the Southern Highlands to the Rhodesias and South Africa has been made, but no estimate of the cost of the complete execution of this project is contained in the Plan i/.

70. No significant expansion of the railway system has occurred since the construction of the short Southern Line. In 1948 the Tanganyika Railways and Ports Administration was consolidated with the systems of the other two East African territories under the administration of the newly established East African Railways and Harbours Administration.

1/ The study on the link with Central and South Africa is: Report on the Central African Rail Link Development Survey by Sir Alexander Gibb and Partners and Overseas Consultants, Inc.., Colonial Office, 2 vols., 1952. - 31 -

The East African Railways and Harbours Administration, assisted by a loan of £8 million from the International Bank, has spent considerable sums of money on the acquisition of rolling stock for the Tanganyika system.

710 Tanganyika has four main ports: Dar es Salaam, the principal port, Tanga, Mtwara and Lindi. AUl together these ports handled in 1956 780,000 tons of imports and 696,000 tons of exports, roughly double the volume in 1948. The rush of post-war traffic found bottlenecks at Dar es Salaam as well as at Tanga, but substantial excpansion of port facilities has since been accomplished at both ports, which are at the termini of the principal railways. With the completion of three deep-water berths at Dar es Salaam, the present port capacity is regarded as sufficient for some time. The Ten Year Development Plan, 1955-65 envisages three additional deep-water berths at Dar es Salaam, increasing present capacity by about one-third, but no firm plans for this project have been made. Roads

72. The road system of the territory is officially classified as follows:

(i) Main roads (can be all-weather roads with addition of permanent bridges) ...... 3,500 miles

(ii) Local and feeder roads (partly dry-weather roads)...... *...... ** *...~...... 3,900 miles

(iii) District roads (dry-weather only)...... ll,055 miles

(iv) Village roads ...... 8,00 miles

Total 26,955 miles

The network of main roads is shown in Map 1. The long-term object of the territory's road program is to bring up to all-weather standard a grid system of four north-south crossed by three east-west trunk roads. This development, together with the projected extension of the railway network, would bring the combined road and rail network into touch with all the areas of thirty-inch rainfall reliability.

73. Progress toward this remote goal has been slow and the maintenance and extension of Tanganyika's road network has been described as a Sisyphean task. In the 1955-65 Development Plan abTat.£&1 million, or one-fifth of the target for total expenditure of £96 million, was allocated to road construction. At roughly £2 million per year, this is about double the present rate of outlay on road oDnstruction. In a recent speech the Minister of Communications and Works stated that of the approximately 27,000 miles of roads in the territory about 8,000 miles are up to the "all weather" or "nearly all weather standard" or are roads with very light traffic. He-put the cost of bringing all the territoryts roads up to standard, at the rate of about £5,000 per mile, at £80-100,000,000. It is not clear, however, how far this conception goes beyond the objective of a three-by-four grid system referred to in the preceding paragraph. - 32 -

Further, according to one official estimate, the cost per mile of con- structing an all-weather gravel road is about £10,000 and of a bitumin- ized road £18,000. It may be that the £5,000 per mile estimate mentioned above is based on a somewhat lower average standard than the typical gravel (murram) all-weather road intended for heavy traffic in East Africa.

74. In the post-war development of the road system particular emphasis has been given to the approaches from Dar es Salaam to the southern part of the territory (Southern Highlands and Southern Province). This is the area that has the greatest potential both for agricultural and, so far as is known, mineral development. The Minister of Communications recently -commented that five years ago it would have been unthinkable to drive from Dar es Salaam to Mbeya (at the northern tip of Lake Nyasa) in one day, though this is done often. In the Eastern and Central Provinces a hard surface road (bitumen) has been completed between Dar es Salaam and Morogoro and is being extended to Iringa in the direction of the Kilombero Valley. It is expected that by the end of 1959 an all-weather road connnec- tion between Dar es Salaam and Dodoma (about half-way across the country) in the Central Province will be completed. It must be borne in mind, how- ever, that heavy rains can make even so-called all-weather roads temporarily impassable. MINING

75. Mineral production may be of considerable importance in Tanganyika's economic future, but the present contribution of this sector to domestic product is only 3 to 4%, about the same as that of manufacturing. A con- siderable variety of minerals is produced in Tanganyika, but diamonds, gold and lead account for most of the value of mineral exports (see Table 12).

76. Although the general geology of the territory is known, it is the Government's view that few areas have been geologically examined in suf- ficient detail for them to be excluded as unlikely to carry economic minerals. A program of geological surveying is being actively pursued by the government, which was assisted for several years (1955-58) by a small team of geologists furnished by the United Nations Technical Assist- ance Administration. A geophysical airborne survey of certain areas in the southwestern part of the country is being undertaken by the Western Rift Exploration Company, a subsidiary of the Anglo-American Corporation of South Africa.

77. The major mineral enterprise in the territory, Williamson Diamonds Ltd., which was established in 1940, achieved full capacity throughput in 1958 with a record high output and exports having an estimated value of £4.4 million, an increase of £1.1 million over the 1957 figures. In 1958, on the death of Dr. John Williamson, the owner of the enterprise, equal shares in the venture were acquired by the De Beers Company and the Tanganyika Government, the Government's share of the cost of the purchase being financed by a long-term loan from De Beers. - 33 -

78. A number of mineral ventures are in various stages of development or planning. These are all private ventures, some being in association with the United Kingdom Colonial Development Corporation, which has approved capital expenditure in minerals and other activities in Tangan- yika of £3,570,000, distributed as follows:

(in thousands of £ sterling)

Mbeya Explorations Ltd. / 330 Rungwe Coal Company 1/ 20 Tanganyika Coalfields Ltd. 1/ 450 Tanganyika Wattle Estates 1,270 Tangold Mining Company 1,000 Williamson Diamonds Ltd. 2,244

1/ Investigations only

79. The development of minerals in Tanganyika is closely bound up with the provision of transport and power facilities, For example, the Mbeya Exploration Company, associating the Dutch firm N.U. Billiton Maj and the Colonial Development Corporation, are investigating the extraction of niobium from pyrochlore in southwest Tanganyika and have already established a pilot plant. Proved reserves of ore are considerable, but full-scale development requires the availability of electric power either from hydro facilities on the Kwira River or from thermal installations burning fuel from the Songwe coalfields also in the southwestern part of the territory. The exploitailon of the large deppsits of coal known to exist in the south- west depends on railway development. A project to establish a railway link between Tanganyika and the Rhodesias and South Africa has been studied. This would traverse the Kilombero Valley and the Southern Highlands and, among other things, would provide access to the coal fields. More recently another project for providing access to the coal fields has been studied. In this instance the Anglo-American Corporation, Frobisher of Canada, the Tanganyika Government and the Colonial Development Corporatior~ associated in Tanganyika Coalfields Ltd., are examining the feasibility of construct- ing an extension linking the Portuguese railway system with Lake Nyasa.

80. Exploration for petroleum is being carried out by the BP-Shell Exploration Company of Tanganyika, which has drilled two deep test wells on the coast, so far without positive results. The second well, drilled to a depth of over 12,000 feet, proved of sufficient geological interest that, according to a recent government statement, the company will almost certainly continue its exploration.

81. Such potential production as is represented bY known but undeveloped mineral deposits is chiefly in phosphates and coal. The Tanganyika Govern- ment has recently reported the discovery of a large phosphate deposit "which may well prove to be of major importance" 70 miles south of Arusha. On the other hand, in its report on East Africa, the Economist Intelligence Unit regarded the large-scale development of a coal mining industry in the next ten years or so as unlikely. It considered that even if a railway 34 -

were built to carry coal tq the coast, the world market would not permit of coal exports on an economic basis, while the development of a signifi- cant amount of coal-using industry in southern Tanganyika would have to await a general advance in the domestic market.

82. The factors determining the likely development of the mining indus- try of Tanganyika are too complex to be adequately discussed here. The high degree of uncertainty surrounding the future of mineral development suggests, however, that any projections of economic growth should probably be made on oonservative assumptions regarding the development of this sec- tor.

MANUFACTURING

83. Since the end of the war, manufacturing, particularly in the form of light industry, has undergone a steady expansion, but this sector still accounts for only 3 to 4% of domestic product. As shown in Table 4, manu- facturing (apparently excluding sisal processing) absorbs less than 20,000 of African employees. On a somewhat broader definition, including certain service trades, miscellaneous workshops, and sisal processing (which alone engaged 24,000 persons), the total number of employees registered in 1956 was about 63,000.

84. The processing of primary commodities grown in the territory is the predominant form of manufacturing; the more important processing industries are cotton ginning, the processing of sisal, coffee curing, sugar manufac- ture, tea processing, meat packing and grain and oil milling. Manufactur- ing for the domestic market is carried out mostly by small units; the prin- cipal trades are light metal, engineering, woodworking, light chemical engineering, brick and tile making and tailoring.

85. Several sizable manufacturing projects are in various stages of development. In 1958 the East African Tobacco Company Ltd. (which has a large plant in Kenya) began to construct a £1.5 million cigarette and tobacco factory in Dar es Salaam. A £350,000 flour mill was established in 1958. Licenses have recently been granted for two textile factories. Another maior project in an early stage is the Kilombero Valley Sugar Scheme, being promoted by the Tanganyika Sugar Company Ltd. This enter- prise, which calls for an integrated growing and refining operation, has a multiracial board of directors, all Tanganyika residents, and is seek- ing finance from private sources in the Netherlands and Tanganyika, and from the Colonial Development Corporation and the International Finance Corporation.

86. Most manufacturing firms are in private hands, but the government has fostered development in manufacturing (and certain other fields) by direct participation on an ad hoc basis. In a recent comment on a pro- posal that such activity might be consolidated in the hands of a public Development Corporation, the Government expressed the view that in the absence of a substantial increase in the amount of capital available for such an institution, it considered that participation on the present - 35 -

basis is just as effective as would be a similar amount of assistance through a Development Corparation. A certain amount of effort has gone into the promotion of African business ventures in the commercial field, however.

87. In 1956 the Administration appointed a Commissioner of Commerce and Industry to give special attention to fmuthering the establishment of indus- try. Other policies adopted by the government to promote industrial devel- opment include provision for refund of customs duties on imported raw mater- ials and equipment in approved industries and the allowance, under the com- pany tax law, of accelerated depreciation on industrial plant and equipment. There is also a systoi3 of licensing of industrial enterprises administered on an East African basis by the East African Industrial Council, a govern- mental body, with representation from three territories. The licensing procedure is aimed at protecting newly established manufacturing enter- prises from "urneconomic competition" in scheduled industries which now in- clude mainly textiles and various metal products. The limited number of scheduled industries seems to indicate, among other things, that the scope of possible confilict between Tanganyika, on the one hand, and Kenya and Uganda,on the other,con3erning the location of industry within the East African region is not considered large at present. Within the East African region, industrial development has advanced most in Kenya where the con- tribution of manufacturing to met national product rose from 9% in 1947 to 13% in 1956, Tanganyika's imports of industrial products from Kenya include an increasing amount of light manufactures, and Kenya is expected to shift shortly from a net importer to a net exporter of cement. The "problem" of Kenya's head start in manufacturing and the general question of the location of new manufacturing ventures within the region may be of importance, how- ever, in the long-term development of Tanganyika, though the limited size of the domestic market in Tanganyika appears to be the more immediate obstacle to industrial development.

88. As mentioned earlier, the customs duties of the three East African territories are coordinated within a de facto customs union. In the case of Tanganyika, import duties serve primarily to raise revenue, but the question of tariff protection for development has become more prominent recently, particularly in connection with the promotion of a textile in- dustry. In 1958 a number of changes were introduced into the East African tariff schedules, including a moderate increase in the level of the general import duty and an increase in import duties on textiles and clothing from 22 to 30%. The immediate object of this increase appears to have been to assist the large new cotton textile mill in Uganda (Nyanza Textile Mills Ltd.) which has been losing money heavily under the impact of competition from Indian and Japanese textiles. It has been suggested by some observers that the licensing of a textile mill in Tanganyika which followed the tar- iff increase was, in effect, a by-product of the decision to increase pro- tection of the Uganda mill. - 35a -

MONETARY AND FINANCIAL INSTITUTIONS

The East African shilling, the common currency of Tanganyika, Kenya and Uganda, is issued by the East African Currency Board. This Board is obliged to keep at least 100% sterling backing for currency issued in East Africa. Its function is to make available East African currency against deposits of sterling, and to provide sterling freely in exchange for East African currency. Its assets consist predominantly of United Kingdom Government securities or the equivalent.

This system has several important consequences. In the first place, financing of government deficits by money creation or borrowing from a local central bank is impossible in Tanganyika, there being no cen- tral bank. If the government wishes to spend more than it receives in current revenue, it must run down assets, borrow from persons, firms or corporate bodies at home, or else borrow externally.

Another consequence is that deficits in the external balance of payments (at any rate for the three territories combined) tend to some ex- tent to be self-correcting. An excess of payments to the outside world over receipts from the outside world automatically brings about a corres- ponding contraction of the currency circulation.

The system does not automatically prevent development of some ex- cess pressure or demand but it makes impossible any major inflation. In- ternal purchasing power may increase in relation to available goods and services as the result either of an export surplus or of the receipt of credits from outside. Commercial banks may vary money supply in the broad sense through their local credit operations, subject to the limits im- posed by their assets held with their headquarters in London. Up to a cer- tain point the holders of an increase in local purchasing power may prefer to spend it locally rather than externally, and so exert the equivalent of inflationary pressure. However, there is always a pressure valve in that anybody holding currency or a bank account in East Africa remains free at all times to convert it into sterling.

In addition to the commercial banks and several private building societies four governmental sources of credit for special purposes are available, all of them of modest capitalization and intended to provide small loans to individuals mainly for agriculture and urban housing. The largest of these agencies, the Land Bank, provides credit facilities to members of all races and the other three to Africans only. The agencies and their operations are as follows: Number of Loans Outstand- Total amount of Agency ing at 31 October, 1958 loans outstanding Land Bank 525 f,84,90 African Productivity Loan,Fund 299 t 93,676 Local Development Loan Fund 286 £ 62,142 Urban Housing Loan Fund 285 f22,5OOO

In 1958 the Local Development Loan Fund was authorized to approve - 35b -

loans for capital equipment for African commercial enterprises.

The local capital market is, as yet rudimentary, but the Govern- ment has recently succeeded in raising two long-term loans locally, the latest in 1958 in the amount of fl million.-

The number of depositors in the Postal Savings Banks has risen from 50,000 in 1948 to about 100,000 with balances of about f2.4 million. - 36 -

CHAPTER III. DEVELOPMENT PLANS AND THEIR FINANCING

89. Since the end of the Second World War the Government of Tanganyika has undertaken a substantial amount of capital expenditure for purposes of economic development. A considerable portion of the steadily growing current expenditure on economic and social services can also be considered as developmental. Other important development expenditures have been made by the East African Railways and Harbours Administration and by the East African High Commission, the latter for various joint research and other technical services.

THE TERRITORIAL BUDGET

90. Tanganyika's budget consists of two parts, one relating to current revenue and expenditure and the other to the capital budget, sometimes referred to as Developmernt Expenditure (see Tables 22 and 23) Current expenditure has risen from about £5.7 million in 1947 to £21 million in 1958/59, while capital expenditure has grown from less than a half million pounds to £6.6 million 1/. In recent years Development Expenditure together with current expenditure on economic and social services has been of the order of £15 million per year, or roughly 60% of the total budget (see Table 24).

91. While capital expenditure rose from £4.9 million to £6 million between 1952 and 1958/59, the current outlay for economic and social ser- vices rose more rapidly from £4.2 million to £10 million, or from 11% to 20% of total current expenditure. As indicated in Table 24, economic services (agriculture, water development, roads) have claimed roughly a constantc 30% of current and capital expenditure combined since 1952. Over the same period combined expenditure on social services (education and health mainly) rose from 18% to 30% of public expenditure.

92. Since the end of the War, Tanganyika's territorial revenues have been sufficient to finance the rapidly expanding current expenditures and, in addition, to cover a minor part of capital expenditure. Supported by the post-war boom in primary commodity prices and the expansion of output of the territoryt s major exports, revenue rose rapidly and in 1954/55 reached about £19 million, which was above the temporary peak attained during the commodity boom of the Korean War. Significantly, however, no expansion of territorial revenue has occurred since 1954/55.

93. During the past year or two this tendency appears traceable to the general decline in export income caused by the drop in commodity prices. There is an apparent contradiction, however, in the fact that the value of exports rose substantially during 1954 to 1956 and still remains well above the pre-1954 level, while revenue has remained virtually unchanged since 1954/55. The explanation may be found in the sisal industry. Sisal

1/ Since 1954 the fiscal year refers to the year ending 30 June. Unless otherwise stated, figures for the year 1958/59 are budget estimates. - 37 -

prices have been declining steadily since 1954 (and even earlier), and narrowing margins of profit in the sisal industry appear to be reflected in the steady decline in revenue from income taxation since 1954/55, This suggests that the contribution to territorial revenue of the sisal industry is more than proportionate to its share in total exports.

94. While current revenues have reached a plateau during the past four or five years, current expenditures - which previously were considerably below current revenue, thus permitting transfers to reserves for the financing of capital expenditure - have risen rapidly, by roughly 40%. These divergent trends explain the budgetary "crisis"l with which the ter- ritory is now confronted. In 1957/58 the government budgeted for a defi- cit of £701,000 on current account but, owing mainly to restraints on current expenditure, ended the year with a slight surplus. The 1958/59 budget estimates envisaged a deficit of £1.2 million on current account and, despite the fact that actual expenditures are expected to be close to £1 million short of the estimates, a shortfall in revenue below the estimates will lead to a deficit of about £1 million. The outlook for 1959/60 is even less satisfactory so far as revenue is concerned; lower revenue from income tax is expected, mainly because of lower profits in the export sector, and there is expected to be a diminution in customs revenue (import duties) and excises as the result of deflationary tenden- cies brought about by the decline in export proceeds.

95. In these circumstances the Governor recently held consultations on territorial finance with the Secretary of State for Colonies. In March 1959 he informed the Legislative Council that he had received assurance that, in addition to assistance being provided under the Commonwealth Development and Welfare Act mainly for capital expenditure, some special financial. help would be given toward meeting the current deficit. He stated, however, that he was not in a position to give any precise figure on the assistance likely to be made available and that it might be some little time before final decisions can be taken. 96. The emergence of this budgetary difficulty, which for the first time in the territory's recent history raises the question of external financial assistance to meet not only development expenditure but also the current budget, cannot be said to have been unanticipated, although its arrival has been hastened by the recent weakness in international commodity markets. The balance and relationship between the growth of capital and current expenditure has been a continuing cause of concern in the formulation of the territory's several Development Plans, and obviously poses an issue of major importance for the IBRD Mission. The territory's representative recently informed the United Nations Trustee- ship Council that unless an unexpected and very marked improvement in revenues occurred there would inevitably be a reduction of the social and other services which the territory badly needs. The incidence of such adjustments obviously raises complex questions of finance, politics, and the strategy of development programing. - 38 -

97. The volume of territorial revenue reflects, of course, not only the level of income but also the incidence of taxation. It has not been possible in this memorandum to go into the question of tapping additional sources of revenue within the territory, but it does not appear that this is regarded as a promising avenue of approach to the budgetary problem in the near future.

THE CAPITAL BUDGET

98. Total public capital expenditure, which affords a rough indication of developmental outlays, has ranged between £5 and £6 million during the past five or six years or roughly one-fifth of the combined current and capital budget. During this period the expenditure in particular sectors has shifted substantially. Expenditures on communications (mainly road construction) have declined, while the most rapid growth has occurred in social services (mainly the construction of schools) and township devel- opment. Expenditure on natural resource development (mainly agriculture) has also risen substantially.

99. The sources of financing for the capital budget are shown in Table 23. Extemnal sources (loans and grants from the United Kingdom) have furnished about three-fourths of the funds during the past five or six years. Loans floated on the London market (with approval and, in effect, guarantee of the United Kingdom Treasury) have comprised the bulk of ex- ternally-raised funds, the remainder consisting mainly of United Kingdom Colonial Development and Welfare (C.D.&W.) grants. Tanganyika has relied more heavily than the other two British East African territories on long- term loans placed on the London Market for the financing of its develop- ment program. In consequence the public debt of the territory rose from £5.7 million in 1952 to £16.3 million in mid-1958; annual charges on the debt now absorb about £1 million, or 5% of current expenditure.

100. About one-fourth of development revenue is derived from two ter- ritorial sources: (i) the Development Fund, financed principally from the proceeds of export taxes and similar levies made mainly during the period of high commodity prices prior to 1954/55, and (ii) proceeds from the sale of German-owned assets sequestered during the last War (Custod- ian of Enemy Property Funds). The latter is, of course, a non-renewable source of funds, while the former has been drawn down rapidly during the past several years. As a first move to tap the local capital market the government has successfully floated two moderate-sized local loans (in- cluded in the figure for total loans), one of £1.7 million in 1957 and another of £1 million in mid-1958. Moderate-sized local loans have also been floated by several quasi-public enterprises whose operations are not included in the territorial budget, notably the Land Bank and the Makonde Water Corporation. An application was made to the United States in 1957 for loans from the Development Loan Fund for three schemes of irrligation and road construction totaling over £1 million, but no final action has been taken. The only United States financial assistance thus far has been a grant by the I.C.A. of £100,000 to the African Productivity Loan Fund.

101. The bulk of the C.D.&W. grants are for projects due to be completed by the end of 1960. The United Kingdom recently announced a new appropria- tion for colonial development grants on the expiration of the current C.D.tW. Act in 1960 (White Paper, Cmd. 672, February 1959). The plans - 39 - to the colonies as a whole envisage a further appropriation for C.D.tW. grants/of £95 million through 1964 and also a new form of assistance through "exchequer" loans (direct governmental loans) within a total of £100 million over the same period. Such loans would be additional to amounts which colonies may be able to raise on the London market.

102. Not included in the funds listed in paragraph 99 above are invest- ments in the territory by the United Kingdom Colonial Development Corpora- tion, and the IBRD loan of £8 million to the East African Railways and Harbours Administration, of which a portion may be attributed to Tangan- yikats requirements, and loans raised by the East African Posts and Tele- communications Administration.

OFFICIAL DEVELOPMENT PLANS

103. Beginning in 1946, the Government of Tanganyika has formulated a series of Development Plans covering varying periods, which have been officially described as modest capital works programs. These plans have undergone numerous revisions to take into account changing costs, altered priorities, and other factors. Subject to the limit imposed by foresee- able financing, the plans have apparently been drawn up separately by each Ministry and little has been done to consider them as an integrated whole, although a concept of broad priorities in regional and sectoral development is reflected in them. The Finance Ministry is now consider- ing the establishment of a special economic unit to review all the indi- vidual programs or projects from the point of view of their inter-relation- ship and consistency and to advise the Government on the implementation of the program.

104. The current development plan (Four-Year Plan, 1957/58 - 1960/61), within the general framework of which the annual capital budget is pre- pared, was drawn up by a special Advisory Development Committee. In view of anticipated difficulties of financing the territorial budget on both capital and current account, the Committee was specifically requested to revise those parts of the previous plan (Revised Five-Year Development Plan 1955-60) relating to economic services - with particular reference to the natural resources section - with a view to procuring the fastest possible increase in productivity and production.

105. The Four-Year Plan calls for average annual expenditure of £6.7 million as compared with about £5 million in the Five-Year Plan which it superseded, allocated as follows-

£ Development of natural resources 4,873,000 Communications 4,232,000 Urban development 3,697,000 Electricity 2,000,000 Social Services Medical 1,460,o000 Education 4,284,000 Broadcasting and films 65,oo0 Public buildings 4k,430,000 African urban housing 1,148,000 Miscellaneous 712,000 Total £26,901,000 - 40 -

Actual capital expenditure during 1957/58, the first year of the period covered by the Four-Year Plan, was £5.4 million as compared with the budget estimate for that year of £6.6 million and the annual average of £6.7 mil- lion implied by the Plan. It was, however, the highest rate of public in- vestment achieved in the territory in a single year. 106.. As compared with the preceding plan, the share of communications (mainly road construction) in the Four-Year Plan was sharply reduced while that of public buildings was substantially increased; the shares of natural resources development and of education remained roughly unchanged. The allocation of actual capital expenditures by sectors during the past several years is shown in Table 23. Expenditures on communications have been de- clining steadily, while the share of social services and public works has risen sharply, followed by expenditure on natural resources and township development.

TEN-YEAR DEVELOPMENT PLAN, 1955-65

107. The various plans referred to above have been formulated on a "realistic" basis, in the sense of being within the resources expected to be available to the territory, including United Kingdom grants and loans to be placed on the London market. In 1956 a more ambitious Ten- Year Capital Requirements Program, 1955-65, was formulated in response to recommendations contained in the East African Royal Commissionts 1953-55 Report. In contrast with previous plans, the Ten-Year Plan, in the words of the Governor, was drawn up "to show what could and should be effected during the next ten years if finances were available." "Foreseeable" financing was assumed to cover only about half of the re- quirements. Details of the Ten-Year Plan, 1955-65 are given in Appendix 1, together with explanatory material contained in a despatch by the Governor.

108. The Ten-Year Plan envisaged a total expenditure of £95.7 million, of which some £48 million was considered to be covered by foreseeable fi- nancing. For planning purposes the expenditure was divided into two five- year periods; the total requirements for the first five-year period aver- aged £8 million per year as compared with £6.7 million under the Four-Year Plan. A more realistic comparison, perhaps, is between the average actual capital expenditure during the years 1956/57 and 1957/58 - about £5.3 mil- lion - rand the £8 million figure of the Ten-Year Plan.

109. The main elements of the proposed expenditure under the Ten-Year Plan are as follows: Provision Additional anticipated funds required Total £ £ £ Communications 12,670,000 24AQ00Q00o 36,770,000 Natural resources 11,200,000 5,950,000 17,150,000 Mineral development 250,000 750,000 1,000,000 Urban development 7,585,000 3,500,000 U1,085,000 Electricity and power 2,000,000 3,000,000 5,000,000 Topographical survey - 500,000 500,000 Public works 4,450,000 5,500,000 9,950,000 Social services 8,793,000 3,550,000 12,343,000 Agricultural and industrial loans 1,000,000 1,000,000 2,000,000 Total 47,948,000 47,850,000 95,798,000 - 41 -

The most striking difference from the pattern of allocation in the Four- Year Plan is the higher share of communications; this seems to be due largely to the fact that during the second period of the Ten-Year Plan projected expenditure on communication rises sharply.

110. In the field of transport and communications, the Ten-Year Plan includes provision for the extension of the Central Line to the Kilombero Valley in the south and for a link between the Northern and Central Lines. Not included is the capital development program of the East African Rail- ways and Harbours Administration (£14 million for the period 1958-62) which covers both specific works to be undertaken in Tanganyika and general ex- penditure on rolling stock, etc., for the system as a whole. A comparable capital program on an East African basis is also envisaged by the inter- territorial Posts and Telecommunications Administration amounting to £8 million.

111. The projected expenditures on water supplies and irrigation cover two phases: (i) surveys and pilot schemes, and (ii) the beginning of construction of substantial permanent works. In its present form the Plan does not contain provision for a large-scale development of the Rufiji basin, which, as noted above, appears to be the major area for potential agricultural development. The United Nations Visiting Mission of 1957 expressed the hope that the period of surveying and pilot projects concerning water supplies was coming to an end and that a general plan for the utilization of all irrigation facilities would be prepared and executed. In reply, however, the government stated its opinion that it was too early to talk of such a general plan, let alone prepare and execute it. It fore- saw the need for further work on hydrology and irrigation economics, and the progressive development of a scheme over a number of years. It added that the development of the Rufiji basin alone would, at an approximate and conservative figure, require £25,000,000.

112. Taking into account the projected expansion of investment in social services and road construction particularly, it was estimated that at the end of the ten-year period the additional charge against the cur- rent budget for teachers' salaries, medical staff, road maintenance and the like would be about £5 million per year. When presenting the Ten-Year Plan early in 1956, the government foresaw the possibility that, if weak- ness in commodity prices persisted, some external help in meeting current as well as eapital expenditure might be needed for a period. In view of the actual and projected expansion of the social services and maintenance charges, a question for further investigation is whether such a tendency might not have emerged even in the absence of the slump in commodity prices. AP4SNDIX 1

Capital Requirements Programme " 1955-65

In 1956 the Governor of Tanganyika published bis observations on the East African Royal Commission's report, including a Ten-Year Capital Requirements Programme indicating the financial implications of the recommendations made by the Royal Commission./ The following material is extracted from the Gcvernor's obeervatftaia.

I. General Observations

Land Use

To advance standards of living the changeover from subsistence to economic agriculture must be accelerated and spread. The need is to overcome the physical obstacles of environment, and the human obstacle which is the suspicion and conservatism of the African farmer. The problems are technical, financial and not least administrative.

The Agricultural Department has over the years built up consider- able knowledge of the agronomy of cash crops under local conditions but, by reason both of the African attitude governed by native law and custom towards land and of lack of resources, knowledge of the soil and its optimum management under intensive farming has still to be acquired. It cannot yet be said with any confidence by what means the long bush fallow can be obviated.

Work is of course going on. In each district an inventory of land in terms of population densities and land use is being compiled and checked. Provincial agricultural officers are compiling and assess- ing ecological data upon which to base agricultural policy for each ecological area. The 1955-60 development plan includes provision for a land use survey and planning unit within the Department of Agriculture. Its function will be to carry out basic land use surveys of selected areas in co-operation with other Departments concerned with land use. The areas selected may be either large, covering whole catchments, or small with a high potential intensive use.

There are some important land usage schemes, and many of lesser importance, which are already in varying stages of execution from survey to settlement. Those to which the Commission refer, the Rufiji Basin Survey which continues to be assisted by the Food and Agriculture

%/ United Kingdom, Despatches from the Governor of Kenya, Uganda and Tanganyika and from the Administrator, East African High Commission, commenting on the East Africa Royal'Commission 1953-55 Report (H.r.S.O., London 1956), Cmd. 9801, pp. 157-180. - 2 -

Organisation, and the Tenant Farming Schemes at Nachingwea, Urambo and Kongwa which under the direction of the Tanganyika Agricultural Corpora- tion are achieving initial successes, are among others to which high hopes are attached.

In all this work research, of which there is now a substantial body both regional and territorial, has a big part to play. I am satis- fied that there is building up a close liaison both among the various research agencies and between them and the executive Departments. To assist and develop this liaison to the greatest possible extent there has recently been appointed in Tanganyika an extra Assistant Director of Agriculture to give exclusive attention to research. The techniques of the "agrarian revolution" must be worked out on the ground and I am at one with the Commission in attaching importance to the perfecting of the two-way traffic between field and laboratory and of the co-ordination of all the many channels which are now involved.

In considering the administrative or human aspect it is necessary to keep in the forefront of one's mind that the idea of the continuous intensive cultivation of the same land is, broadly speaking, foreign to the African. It is, therefore, not a matter for surprise when hostility is manifested against soil conservation measures which involve hard work or against a progressive individual whose modern methods and machinery may exclude shifting cultivators from a stretch of land which they had reckoned to "mine" in their own good time. The problem is everywhere how to win the co-operation of cultivators and herdsr,aen, to "make the agrarian revolution their own", as the Commission aptly put it. Though a necessary step, it is not enough to gain the understanding and co- operation, however enthusiastic, of the Native Authorities; it is essential to carry conviction to the men and women who actually do the work. Small demonstrations, coupled with travelling bush schools, applied to an area no larger than the staff available can closely supervise, will with patient perseverance lead to a climate of opinion in which the majority will approve sanctions for a laggard or ill- disposed minority. If there is any other technique for the effective use of either persuasion or compulsion it has not been found in Tanganyika.

To sum up, there is in Tanganyika very considerable scope for improved land use, and it is by no means impossible for there to be a gradual and spreading changeover from subsistence to economic farming. Land, including that which can be provided with water and be rid of tsetse, is available in quantity. The speed with which the changeover will be accomplished will largely depend on the quantity and quality of the professional and administrative staff which is applied to the task. The scientific and engineering work now known to be required is far more than the existing and foreseeable professional staff can undertake. There is moreover a vital need to divert time and energy into the train- ing of Africans, not only that they may be taught the developing technol- ogy but that they may be taught also how to administer it with integrity. - 3 -

The second need is that of finance. I anticipate that the application of private capital will in future be confined to a few limited areas from which the maximum output can best be obtained by large scale enterprise experienced in the production and processing of a particular product. Credit for peasant cultivators may later become a heavy Government responsibility but I am not able to take account of it here. The finance which Government will certainly have to find is that for the carrying out of land usage surveys and associated investi- gations, the construction of irrigation and water control works, and the establishment of planned settlement schemes. I estimate that over the next ten years some V17 million should be employed for these partic- ular purposes, including therein a small allowance for the acceleration of the topographical survey of the territory which is consequently necessary. I must here make it plain however that the figure of f17 million is not a maximum in that no limit can be fixed to the amount of money which could be spent in ten years with at least short term benefit on water development. While major irrigation works can only be planned and executed over long periods there is immediate, and one may say infinite, scope for small dam and hafir building, and there is a school of thought which would welcome that line of attack if the funds were available. Of the f17 million, my Government does not at present expect to be able to raise more than fll million.

Communications

Communications must precede not follow development; for without adequate connection between producer and market there can be no change- over from subsistence to economic farming. Of all the Commission's themes this in my opinion is the one that touches Tanganyika the closest.

Tanganyika is approximately 725 miles from north to south and 660 miles from east to west. Within its 362,688 square miles the pockets of fertility, some of them mountainous, are scattered and separated by long stretches of inhospitable country.

The German administration laid down at the beginning of the century the Central Line from Dar es Salaam to Lake Tanganyika and the Tanga line to the Northern Province, and the beginnings of a road system. During the period of the mandate between the wars, the British administration main- tained these lines of communication throughout the trade recession and improved them within the limits of the exiguous financial resources then available. Since the last war considerable and successful efforts have been made to improve and add to the original framework.

Even so, of the zones in Tanganyika which have a "fair prospect" of 30 inches of rainfall annually, none but the lake shores of Mwanza and Kigoma and the coastal areas served by the Tanga, Central and Southern Province lines is in actual contact with a railway. The much larger zones in the north-west and south-wiest have to depend on long distance feeder roads some of which are still not up to all-weather standards. - h -

As you know, the rising costs of railway construction have post- poned and seem likely to continue to postpone the building of a north- south rail link across Tanganyika connecting the Tanga and Kenya/Uganda system with the Central Line, and the latter with the Rhodesian system. Present plans in this respect provide only for building a short middle section in the form of a branch line from Morogoro southwards to the head of the Kilombero Valley, a distance of 200 miles. It is hoped that the first 100 miles, which will serve an area open to immediate develop- ment, will be built in the near future. If the second hundred miles can then be built it will lead into the Kilombero Valley itself. The exten- sion of the line from the Valley up the Iringa escarpment to the top of the Southern Highlands plateau is a desirable but, I fear, more remote development. I hope, however, that within the nextten years it may be possible to fill in the gap between Morogoro and Korogwe so linking the Central Line with the Tanga and Kenya/Uganda system, and also to make some extension of the Southern Province railway.

The present road programme provides for bringing up to all- weather standard a grid system of four north-south crossed by three east-west trunk roads. The north-south roads are the coastal road from Mombasa to Mtwara, the Great North Road from Nairobi to Tunduma, the central road from Lake Victoria to Lake Nyasa and the western road from the Uganda boundary following the shores of Lake Tanganyika down to Abercorn. The three east-west roads run inland from Tanga, Dar es Salaam and Mtwara respectively. For the most part these roads will be brought to the standard of first-class gravel roads. They will be sealed with bitumen only where and when traffic densities make it economical to do so.

When these proposals are carried out all the thirty-inch rainfall reliability areas will be brought into touch with the main road and rail network of the territory.

While Tanganyika is better served with four ocean ports than Kenya and Uganda with one, it is necessary to ensure that we keep abreast if not ahead of the traffic. Dar es Salaam's hinterland includes the south- eastern Congo. The current congestion at Mombasa has extcnded the hinter- land of Tanga and Dar es Salaam, whether temporarily or not, to Kenya/ Uganda and Uganda respectively. Assuming that the Royal Commission's recommendations do accelerate the expansion of the economy, and allowing for mineral development in western Tanganyika, it seems likely that with- in the next ten years the lighterage wharf at Tanga will have to be materially enlarged and the three deep water berths now completing in Dar es Salaam may have to be doubled to six. Such expansion of these two ports would be additional to works already in contemplation by the East African Railways and Harbours Administration.

The estimated cost of all these improvements is f37 million. As at present foreseen the finance which can be put to the purpose over the next ten years is f12M million. -5-

Education

The Commission see the aim as the provision of universal educa- tion up to the intermediate stage in the country and up to the end of the intermediate stage in towns. It is vitally important that it should be understood by everyone that the enormous expenditure involved in providing education is pushing that objective further and further into the future. The present position in Tanganyika is that the limitation of finance necessitates greater concentration during the next five years on intermediate, secondary and technical education and the reduction in rate of expansion in primary education, save possibly in the towns. These measures, which I think are in conformity with the Commission's views, are intended by 1961 to quadruple the number of pupils passing the School Certificate and to increase substantially the supply of skilled labour. But it must be realised that even so the number of pupils passing School Certificate will not exceed h00-500 in that year and the output of really skilled labour is unlikely to meet the demand.

As technical education is so important I will briefly outline the Government's programme. The Trade School at Ifunda is now properly staff- ed and equipped and showing every promise of success. A second Government Trade School is now under construction at Moshi, where the Kilimanjaro Native Co-operative Union is also erecting a commercial school. A third Trade School is planned to be placed in the Lake Province at a later stage. The building of a Technical Institute to provide courses in engineering, building, commerce, domestic science and general academic subjects for 750 pupils of all races is about to begin in Dar es Salaam. This Intitute will provide the highest technical training available within the territory. It is very much to be hoped that these institutions will from the beginning succeed in inculcating the true spirit and standard of craftsmanship and that the doubts of the Commission about the adaptability of the apprentice- ship system to African conditions will not discourage employers from continuing to give a fair trial to the system which has been so important a feature of the industrial strength of more advanced countries. *Mention must also be made of the Royal Technical College in Nairobi to which selected students will be sent to prepare for professional qualifications, and which is due to open, with Tanganyika students in attendance, in March of this year.

Because the fundamental impediment to the expansion of education is its recurrent cost, it is unavoidable that school fees for all levels of education and for all communities should be raised so far as this can be done without leading to any falling off in school enrolments and attend- ances. In this context it will probably be necessary for some years to come to continue the practice of remitting a substantial proportion of the fees for girls, though there are signs that resistance to the education of girls is beginning to yield.

Bearing in mind the recurrent liability it is not practicable to embark on a heavy programme for the construction of educational buildings - 6 -

and in this review estimated expenditure for this purpose over the next ten years is limited to f8 million, a figure which does not of course include such buildings as the voluntary agencies may be able to undertake. Unfortunately building costs continue to rise and as a consequence of this and the need to get the maximum capacity from the funds available, schools are now being built to minimum standards compatible with township building regulations, reasonable efficiency and the avoidance of high maintenance costs.

Finance

As the Commission so wisely remarks, what is important is not that there should be development plans but that there should be capital resources available to promote expansion. I am the first to acknowledge that this territory has received valuable financial assistance from external sources, but it has to be stated that the continuing drop in the value of money has frequently resulted in the real value of the assist- ance being less than was intended at the time it was granted. I am mind- ful that good things come to those who help themselves but I think that Tanganyika has, if not over-exerted itself, at least exerted itself to the limit of its present meagre resources to provide from within capital for development. It is forcibly argued here that the level of taxation has been raised at a time when the economy of the territory would have benefited from a reduction in taxation. Be that as it may, it cannot be disputed that any further increase in the level of taxation can only be harmful. I must also make the point that in an agrarian country, the revenue of which is at the mercy not only of unstable prices for agricultural produce but also of the vagaries of the weather, the surplus balances in the Treasury should not be so reduced as to jeopardise payment for essential services when a large fall in revenue is temporarily suffered.

It was against this background that my Government prepared its recently published capital works programme for the five year period ending in 1960. It was necessarily a modest prgramme with an estimated cost of f26 million. Even so the foreseeable finance falls short of that figure by f2l million. This programme does not measure up to the demands of the Commission's Report, and an expanded programme has therefore been drawn up to show what could and should be effected during the next ten years if finance were available.

This expanded programme, which is set out in the Annexure in the form of a Schedule with notes attached, covers the ten years from now until 1965 and includes all that has been set forth in the published 1955-60 plan. As I have said, the latter has an estimated cost of f26 million. The expanded programme has an estimated cost of fh2 million for the five years and f96 million for the ten years, against which the foreseeable finance is f24 million and fh8 million respecti,Tely. Of the total of f96 rciillion more than one-third, or f37 million, is for comnuni6ations. f1(9 million is ior exnen.iture upon natural resources inclurding water and minerals, fll million on urban development, f5 million on nower, ancl £2 Million on agricultural - 7 -

and industrial loans. It is significant that not more than f12 million, of which f8 million will be for education, can be allocated to those social services which will not give an immediate return in economic activity although they are essential for the attainment of the increased standards of efficiency required for further development. I wish very much that the expenditure of flO million on departmental buildings and staff houses could have been reduced but I am satisfied that anything less would be unrealistic and would only result in inability to carry out the programme.

The question must be faced whether, if the capital finance is made available for the expanded programme, the resulting increased recurrent costs can be met. In the long run, when the development expenditure becomes fully effective, I have no doubt that they can. There will how- ever be an intermediate period when many of the schernes proposed may not be fully viable and it will be some considerable time before the education- al investment brings return. To what extent and for how long the economic schemes will not be fully viable, and the time which will elapse before they will be able to carry the enhanced social programme as well, will depend on the trend of word agricultural prices. The trend at the moment is unfavourable to an agricultural economy and should it persist some external help in meeting recurrent commitments may also be needed for a period. If, however, prices for our main exports stabilise at a reason- able level, I am confident that any period for which such assistance was needed would be short.

I have endeavoured to set out as concisely as I can the implications of the Royal Commission's Report as applied to Tanganyika. I am naturally far from content at the sum of my conclusion, which is that if we are not to resign ourselves to half measures there has to be found within the next ten years fh8 million which in the ordinary course as I see it will not be available to this Government, and this takes no account of what the High Commission requires for its services, including the development programmes of the East African Railways and Harbours and Posts and Telecommunications Administrations. ESTIMATED CAPITAL REQUIREMENTS 1955-65 Total Period 1955-60 Period 1960-65 Additional Total ______Require- Additional Provided in Total Total ments for Require- HEAD Develop- Balance Require- Provision Balance Require- 10 years ment by ment Plan Required ments Anticipated Required ments 1955-65 Heads 1955-60 Cols. 3 and 6 1 2 3 4 5 6 7 8 9

f f f f f f f A. COMMUNICATIONS 1. Railways . 3,000,000 - 3,000,000 _ 9,000,000 9,000,OOL 9,000,000 2. Harbours . .- 2,500,000 2,500,000 - 3,000,000 3,000,000 5,500,000 3. Roads . . . . 4,270,000 3,800,000 8,070,000 5,000,000 5,000,000 10,000,000 8,800,000 4. Aerodromes . .200,000 600,000 800,000 200,000 200,000 400,000 800,000 24,100,000

B. NATURAL RESOURCES 1. ,griculture and Veterinary 1,200,000 800,000 2,000,000 2,000,000 1,000,000 3,000,000 1,800,000 2. Water Supplies and Irrigation 3,500,000 1,500,000 5,000,000 4,000,000 2,000,000 6,ooo,000 3,500,000 3. Afforestation .250,000 150,000 400,000 250,000 500,000 750,000 650,000 5,950,000

C. MINERAL DEVELOPMENT . . . - 250,000 250,000 250,000 500,000 750,000 750,000 750,000

D. URBAN DEVELOPMENT 1. Water Supplies .2,450,000 1,000,000 3,450,000 2,000,000 500,000 2,500,000 1,500,000 2. Se-4erage and Surface Drainage 525,000 500,000 1,025,000 1,000,000 500,000 1,500,000 1,000,000 3. African Urban Housing . . 970,000 - 970,000 - 500,000 500,000 500,000 4. Miscellaneous .140,000 - 140,000 200,000 - 200,000 - 5. Site Development (Industrial) 100,000 200,000 300,000 200,000 300,000 500,000 500,000 3,500,000

E. ELECTRICITY AND POWER . . . . 2,000,000 - 2,000,000 - 3,000,000 3,000,000 3,000,000 3.000,000 3,000,000

F. TOPOGRAPHICAL SURVEY . . . . - 250,000 250,000 - 250,000 250,000 500,000 500,000

G. PUBLIC WORKS 1. Staff Housing .1,000,000 2,000,000 3,000,000 1,500,000 1,500,000 3,000,000 3,500,000 2. Government Buildings . . . 950,000 1,000,000 1,950,000 1,000,000 1,000,000 2,000,000 2,000,000 5,500,000

H. SOCIAL SERVICES 1. Medical Buildings . . . 1,400,000 800,000 2,200,000 1,750,000 500,000 2,250,000 1,300,000 2. Education Buildings . . . 3,793,000 - 3,793,000 1,750,000 2,250,000 4,000,000 2,250,000 3. Broadcasting .100,000 - 100,000 - - - 3,550,000

I. AGRICULTURAL AND INDUSTRIAL LOANS ...... - 500,000 500,000 1,000,000 500,000 1,500,000 1,000,000 i,O O,O O 1,000,000

TOTAL . 25,848,000 15,850,000 41,698,000 22,100,000 132,000,0001 54,100,000 47,850, 000 47,5000 -.9 -

III. Notes on the Capital Requirements Programme for 1955-65 The suggested capital requirements for this ten year period have been divided into those needed during the first five years and those needed in the second five years. It will be noted that the periods relate to Government financial years, i.e. from 1st July to 30th June. It is calculated that during the first period a total sum of f41-2 million, including the expenditure of f25 3/4 million forecast under the 1955-60 Development Plan, can be spent. Towards this amount of f412l million, f232 million is expected to become available, the short- fall for the years 1955-60 amounting to £18 million. It is expected that during the second period 1960-65, 254 million is required, towards which £22 million is likely to become available from normal sources leaving a shortfall of £32 million. Thus, for the whole ten-year period the total deficit in funds amounts to approximately f50 million.

The Plan has been drawn up for the fulfilment of only the most urgent projects for the welfare and economic progress of the territory. It is within the works capacity of the territory, not necessarily as that capacity stands at present, but on the assumption that during the next few years the capacity can be considerably augmented. There would, in fact, be no difficulty about augmenting works capacity provided that it was reasonably certain that a large programme loomed ahead.

It is difficult to calculate the recurrent expenditure that may result from the undertaking of this proposed programme. As regards rail- ways, it must be accepted that during the second period 1960-65 and for some years thereafter, the railways projects may not be fully economic, but the degree to which any losses may devolve either from Government itself or upon the users of the railways is uncertain. As regards harbours, it is judged that the users of the ports will be the bearers of the increased cost and that Government itself is not likely to be saddled with any recurrent burdens. It is also difficult to estimate the amount of additional recurrent expenditure which will result from the road programme envisaged but a reasonably close figure may be £750,000 per annum at the end of the ten year period.

Turning to the other heads, it is clear that there will also be a considerable burden of recurrent expenditure arising particularly from the capital expenditure on social services, which may amount to approximately 10 per cent. of the total, i.e. El- million. In other cases there should be little or no recurrent burden after the first few years. For instance, water supplies and a great deal of the urban development will be paid for by the consumers and ratepayers. At a very rough calculation it is suggested that the additional recurrent burden at the end of the ten year period may amount to as much as f5m. per annum, but world prices of crops will have a marked effect on the viability, or otherwise, within the period, of a number of the NTatural Resources Schemes. A. Communications

(1) Railways. - The only items which have been inserted for Rail- ways and Harbours projects are for those works which are not already included in the Development Plan of the E.A.R. & H. and exclude expendi- ture on such works as the re-ballasting or re-alignment of either the Central Line or the Tanga Line, the provision of additional facilities on the Lakes, the building of a new railway station in Dar es Salaam, and the removal of the M4echanical Workshops to Morogoro. In the first period the only railway project which has been included is that for the extension of the Central Line to the northern end of the Kilombero Valley on the assumption that a large sugar undertaking will begin operations there. It should be noted that included in the f9 million for the second period is provision for the extension of that railway to the head waters of the Kilombero Valley; for it is reasonable to assume that during the next five years sufficient progress will have been made with agricultural and hydrological services to provide the necessary data for the development of that area. The second project which is included is in respect of the Korogwe-Morogoro or Korogwe-Kilosa link for which it is estimated that a sum of nearly f6 million will be required. While at the present time there is no prospect of an economic return for a link between the Tanga and Central Lines, it is felt that within the ten year period there is likely to be a demand for such a link not only on administrative grounds but also in order to open out the country which would be traversed by such a railway.

(2) Harbours. - The problem of the development of the port of Dar es Salaam and the question of how many additional deep water berths will be required within the next decade is a peculiarly difficult one. The estimate of the E.A.R. & H. Administration, which has to some extent been confirmed by the Report of the Economist Intelligence Unit, is that there will be a 5 per cent. cumulative increase in the traffic passing through the port. It can therefore be deduced that with the three deep water berths now being built and the lighterage facilities available, no addition- al new work will be required for some years and the port capacity, which theoretically could amount to 1,500,000 tons per annum, will be sufficient for some time. Nevertheless, there are serious factors which can be brought to bear in argument against this view. In the first place there are indications that traffic trends may be much greater than those at present calculated by the E.A.R. & H. Administration. During the past six years - which is admittedly a very short period - there has been, exclusive of bulk oil traffic, a cumulative increase of 92- per cent. per annum. It is considered also that if the development of the territory quickens through the provision of new capital and the gradual implementation of the Report of the Royal Commission, traffic in both imports and exports will very materially increase. It would not be unreasonable to assume a cumulative increase of 72 per cent. per annum. In this assumption it has been taken into account that the Belgian traffic will increase very considerably both in respect of imports and exports. On this basis the amount of cargo, exclusive of bulk oils, which would require handling by 1965 would be - 11 -

1,675,000 tons. As this is an hypothetical exercise no firm reliance can be placed on these figures.

Nevertheless, there are many other factors which have to be considered in assessing the future of Dar es Salaam port. It is calcu- lated that with a struggle as much as 750,000 tons of cargo can be handled by lighterage, but this is a wasteful and uneconomic method of handling cargo and experience shows that even with the fleet available at present there are inevitable delays and difficulties. Lighterage needs a great deal of additional labour and many units of the lighterage fleet will before long require replacement. It is probably not prudent to calculate that more than 600,000 tons per annum can be handled by lighterage rmethods and an additional 600,000 tons handled at the three deep water berths now under construction. In this connection it should be noted that it will not always be possible for the Belgian berth to be used to its full capacity. An additional three deep water berths would add to the capacity of the port some 675,000 tons, giving a total of 1,875,000 tons which will be more than the capacity which appears to be required. In that event the lighterage fleet could, if necessary, be reduced. For the foregoing reasons it is calculated that at least three additional deep water berths will be required in the next ten years and that it may be necessary to start a fourth. Provision has been made as shown in the Schedule for the building of the first three. It would be logical and economical to continue building operations as soon as the existing three berths are completed, in which case the additional three envisaged would probably be completed by about 1962. If at that date there was spare capacity in the port, the lighterage facilities could be reduced and, in fact, may have to be reduced unless replacements are made.

It is estimated that the cost of the three berths will be approxi- mately f4 million, of which f2,500,000 will be needed in the first period. In addition, provision is made for increasing the capacity of Tanga port during the second period at the cost of aporoximately fl million by extensions to the existing lighterage wharf and the erection of additional sheds on the quayside.

There are two smaller items which are nevertheless of great import- ance. The first is an estimated provision of f300,000, for the removal of the port facilities at N4wanza from their existing site to a new site a short distance to the south. The port installations cannot be extended on the existing site which is extremely cramped. The rebuilding of the port at Mwanza South would provide Mwanza with far better facilities and allow of the release of the existing port area for extremely valuable build- ing sites. Lastly, provision is made for a sum of f200,000 for the building of a small port at Ikombe on Lake Nyasa. A recent survey by Messrs. Halerow at this Government's request has finally disposed of any hopes of building up the existing port at Itunge. The consultants have advised that a new port should be constructed on the north-east corner of the Lake at Ikombe. The need for a good outlet over Lake Nyasa for the produce of the TukuVu and Mbeya districts has been felt for a long time. The INyasaland Railways - 12 M

intend to increase the capacity of their fleet on the Lake and it is throught that advantage should be taken of this improved economic transport.

(3) Roads. - Unless additional capital funds are obtainable it will not be possible within the next ten years to complete the projected programme to bring the roads system of the territory up to the required standard and in particular it will not be possible to provide sufficient money for the construction of roads to newly developed areas.

A careful programme has been tentatively worked out, the details of which are shown in the Road Programme. The first objective is to complete the main system of roadways, which is in fact a grid system consisting of four main roads running from north to south and three from east to west across the territory. To accomplish this several millions of pounds will be required, as in some cases these roads do not exist and in others they only exist to a very poor standard frequently impassable during wet periods. The second objective in the programme is to provide bituminous stretches primarily on these main roads where traffic densities warrant them. In fact, it is expected that within this programme an additional four hundred miles of bituminous roadway should be constructed. The third objective is to bring the township roads up to the requisite standard, particularly in the high density areas where there is a great backlog of work to be undertaken. Fourthly, large sums must be provided for the improvement to district roads and minor roads in order that these can be brought up to a reasonable standard so that both local produce and imported consumer goods may easily reach their respective markets. Lastly, but by no means least, a very large sum of over f2 million is set aside for the provision of roads to new productive areas whether of agricultural, mineral or industrial nature.

The Plan envisages a total expenditure of f18 million for the ten year period. The programme is realistic and capable of being undertaken within the period. Not only has capacity increased both of the Public Works Department itself and of contractors, but the experience gained dur- ing the past decade has shown that reasonable roads can be constructed to a good gravel standard at no great cost and with no very great delay. The recurrent implications are not inconsiderable and will probably rise to about f750,000 per annum by 1965 in addition to existing expenditure.

(h) Aerodromes. - The territory is moderately well served with aerodromes at the present time and has a number of aerodromes up to International F. standard, i.e. capable of taking Dakotas. It is not thought likely that in the next ten year period many aerodromes capable of taking large aircraf will be required. At such places as Tanga and Tabora, however, aerodromes for heavier aircraft will probably be required and provision has been made in the Paln for these extensions.

In addition there are still a number of airfields which require to be brought up to full Dakota standard and many more which will be needed for the servicing of smaller planes. - 13 -

B. Natural Resources

The estimated expenditure on the development of natural resources included in the 1955-60 Development Plan represents the maximum sum that can be made available, not the sum which can be expended to advantage. These estimates have since been re-examined in the light of the Royal Commission Report and account has also been taken of possibilities which have in the meantime received further study.

Land Use. - It has for some time been apparent that a systematic approach to research into soil management was necessary, more particularly in relation to the agronomy of rotational cropping. It was hoped that this research would be largely financed from the C.D. & W. Central Research Allocation and would be closely associated with land use surveys. This research programme was considered essential to the development of inten- sive settled cultivation, a pre-requisite to the system of individual land tenure recommended by the Commission. Unfortunately, it is now known that little, if any, assistance will be forthcoming from the Central Research Allocation.

The sum of f200,000 earmarked for land use surveys has therefore been increased by another f200,000 for the establishment of the requisite agricultural research stations to form one comprehensive scheme which will cost f4Oo,000 in capital and recurrent costs up to 1960.

Planned Settlement Schemes. - It is still not certain at what rate this form of development can wisely be undertaken but as investigations proceed, considerable potentialities become apparent. The fl,000,000 already earmarked for this purpose has been increased by an additional £500,000.

Veterinary. - The livestock industry is, of course, provided for under the above headings but there are, in addition, two special require- ments in respect of which sufficient information is now available to estimate more precise needs.

The first is for more facilities to train Veterinary Assistants so that an adequate cadre can be built up in a reasonable time. It is accord- ingly proposed to double the Veterinary Training School at Mpwapwa at a cost of f20,000.

The second requirement relates to East Coast Fever and other tick- borne diseases. It has now been established that these diseases are the limiting factor in livestock development in many under-stocked areas, and experience with the Iringa Dipping Scheme has shown that they can be controlled under local conditions at a reasonable cost. It is accordingly proposed to embark upon a continuing programne of dip construction in areas where surveys point to the need for dipping, and capital expenditure at f20,000 per annum is envisaged. f80,000 will thus be required for this purpose up to 1960. Water Supplies and Irrigation are the key to the greatest potential field of development in the country and once the initial difficulties have been overcome and pilot schemes are working success- fully, the rate of development is likely to be rapid. At the same time, hydrographic surveys in progress point to the need for improving the water regime in many catchments by the provision of storage dams on rivers to check the wet season flow and augment the dry season flow. Once the requisite surveys have been completed considerable funds will be repuired for construction. Accordingly fl: million has been added to the f3F million already provided for these purposes.

Afforestation. - There is now every indication that, given the requisite funds, the Forest Department will be in a position to undertake an annual planting in excess of that for which provision has already been made. The importance of making the best use of forest reserves needs no emphasis. fl50,0O0 is needed in addition to the f250,000 already provided.

It is impossible to make precise estimates of requirements in the 1960-65 period but the estimates provided represent the conclusions drawn from a careful review of the rate of progress likely to be achieved by 1960 and probable requirements in the subsequent quinquennium.

C. Mineral Development

It is considered that the Mineral Exploration Team, mentioned in paragraph 40 of the despatch, has rendered to the mining industry a valuable service in excess of the cost of its operations. Provision has therefore been made for the continuance of its activities during the next ten years.

D. Urban Development

(1) Water Supolies. - The increasing tempo of urbanization which has already taken place and which will doubtless be accelerated during the next ten years means that in a number of places the township water supplies will have to be considerably augmented. It is considered that insufficient capital is likely to be available from normal sources for this purpose dur- ing the next decade. In Dar es Salaam, for instance, it is likely that the new supply from the Ruvu River which is now being installed at a cost of approximately fl2 million may have to be again increased by the provision of a second pipe-line which may cost a further fl million. Moreover, apart from existing townships where supplies are likely to be deficient, it is expected that several new townships or settlements will spring up which will require proper water supplies.

(2) Sewerage and Surface Drainage. - A recent report by the medical authorities indicates that sewerage systems will have to be installed in Moshi, Arusha and MIwanza, and it is likely too that further extensions will be requiredboth in Dar es Salaam and Tanga. The lack of surface drainage in a number of townships has always been a serious problem and additional sums will be needed for this purpose. - 15 -

(3) African Urban Housing. - After the proposed African Urban Housing Company becomes established it should be able to meet its obligations without any further capital expenditure over and above that which is envisaged for the first five year period, but it may well be that as demand will exceed supply and the difficulties of establish- ing housing on a purely economic basis will continue, it may be necessary to inject further capital into the company during the second five years and for this purpose a sum of f500,000 has been included in the programme.

E. Electricity

The preliminary estimate by Mr. F. P. Egerton, C.B.E., of the cost of electrical development needed before 1963 was f4 million, of which the major item would be the future development of the Pangani Falls and a transmission line from the Pangani Falls to Dar es Salaam.

Surveys for this scheme are at present being undertaken by Messrs. Balfour Beatty & Co., Ltd., the Electric Supply Companies' consultants, and it is likely that proper estimates will be ready at an early date. These may prove to be slightly in excess of Mr. Egerton's figure.

Whether the finance for this development is provided by the Electric Supply Companies or by Government (and there would be certain advantages in this latter alternative), external finance will be needed. The figure of f2 million, which was inserted in the Development Plan, is the amount likely to be spent before 1960.

F. Topographical Survey

It is evident that progress with the land usage schemes, which are envisaged, will be retarded unless accurate maps are available. A topo- graphical survey of the territory, mentioned briefly in paragraph 15 of the despatch, should be started without delay. Provision has therefore been made for as much of this work as it is considered possible to accom- plish during the next ten years.

G. Public Wforks

(1) Staff Housing. - The sum of El million provided in the 1955- 60 Development Plan and an amount of fl2 million suggested as being avail- able for the period 1960-65 for Staff Housing are quite inadequate, but it is difficult to see how more could be provided for this purpose in view of the urgency of other items. Ever since the war there has been a short- age of Staff Housing which still persists in spite of all efforts. During the first few years after the war the difficulties were experienced through the lack of staff and building capacity but now and in future years it is the absence of money which limits the number of houses that can be built.

At the present time there is a shortage of about 150 houses for officers recruited from overseas and with the development of the territory envisaged in this programme steady additional recruitment will be necessary - 16 -

if the plans are to be fulfilled. In addition, a large number of houses of an inappropriate and obsolete standard require replacement at the earliest possible date. It has to be emphasised also that it is essential to provide an increasing quantity of Staff Housing for officers not recruited from outside the territory, particularly in those places where accommodation cannot be rented. This applies to all out-stations and a number of other places. The figure set out of f6 million for a ten-year period is considered to be realistic.

(2) Government Buildings. - As with housing it has not been possible to provide sufficient or suitable offices for the Civil Service. In Dar es Salaam there are many buildings of a temporary nature and others quite inappropriate to the needs of a modern Service. It is intended to replace all these over a period of years and to include in the programme a new Legislative Council building and a new High Court. When the plans were originally formulated it was estimated that the total cost would be fl million, but it now is doubtful whether the project can be completed for under fl2 million. In addition, it is most essential to provide suitable office accommodation not only to meet the existing deficiencies in up-country stations, but also to meet the needs of a grow- ing Civil Service. A large number of District Offices, Provincial Head- quarters, County Council buildings, Town Council buildings, Court Houses for Magistracy, Stores, Workshops and Depots are required.

H. Social Services

(1) Medical Buildings. - The lack of adequate hospitals in the territory has long been a matter of reproach to Government. Owing to capital expenditure upon projects which will bring more immediate wealth to the territory it has not been possible to enter upon a full scale building programme of hospitals, and it will be necessary to add to the likely provision in order that a reasonable programme may be achieved within the next ten years. Included in this tentative programme is the completion of the large new hospital in Dar es Salaam which is in the process of erection, complete newr large-scale units at Mwanza and Tanga, a number of district hospitals, tuberculosis sanatoria, leprosaria and other medical buildings. A large amount of capital expenditure is required in order that medical training may be undertaken on a proper scale.

(2) Education Buildings. - No additional funds during the first five years have been suggested as necessary for there is already a large programme contemplated including the European type school at Iringa and a considerable programme of capital works to be undertaken by the European and Indian Education Authorities in addition to the provision of many more schools for African education. It has to be noted that with the exception of primary schools in urban areas, no provision is included in this programme for African Primary Education ap this is the responsib- ility of the local authorities. 17

During the second period it is suggested that an additional f24 million will be needed over and above the fl 3/4 million which it is expected can be provided. During this period also it is expected that more immediate attention will have to be paid to higher education.

I. Agricultural and Industrial Loans

Apart from the Land Bank and small revolving loan funds - one for African agricultural projects and the other primarily for African industrial purposes, no forms of Government credit facilities exist. It is thought that during the next ten years it will be essential to increase the availability of agricultural and industrial loans, and for this purpose it is suggested that a further fl million will be needed over and above that which can probably be provided from existing sources. - 18 -

BIBLIOGRAPHY

L ote: More detailed bibliographies on Tanganyika are contained in the following:

Tanganyika: A review of its resources and development. Prepared under the direction of J. F. R. Hill and edited by J. P. Moffett. Tanganyika, 1955. Biblio- graphy, pp. 861-868.

Handbook of Tanganyika, 2nd ed. Edited by J. P. Moffett. Tanganyika, 1958. Bibliography, pp. 567-6777

General Economic Surveys

BARCLAYS BANK, D.C.O. Tanganyika: An economic survey. London, Annual since 1954.

TEUBUSCHER, C. Tanganyika Territory: A study of economic policy under man- date. London, Oxford University Press, for Royal Institute of Inter- national Affairs, 1944, pp. 217.

MALCOLM, D. W. Sukumaland: An African people and their country, a study of land use in Tanganyika. London, Oxford University Press, 1953, pp. 224.

TANGANYIKA. Tanganyika: A review of its resources and their development. Prepared under the direction of J. F. R. Hill and edited by J. P. Moffett. Tanganyika, 1955, pp. 924.

EAST AFRICA ROYAL COMMISSION, 1953-55 Report: (Chairman, Sir Hugh Dow). London, H.M.S.O. 1955, pp. 482 (Cmd. 9475). See also: United Kingdom, Colonial Office. "Land and population in East Africa". London, H.M.S.O. 1952 (Colonial No. 290). See also: United Kingdom Colonial Office. tDespatches from the Governors of Kenya, Uganda and Tanganyika and the Administrator, East Africa High Commission, commenting on the East Africa Royal Commission, 1953-1955 report". London, H.M.S.O. 1956. (Cmd. 9801).

See also: United Kingdom, Colonial Office. "Commentary on the despatches from the Governors of Kenya, Uganda and Tanganyika and the Administrator, East Africa High Commission, on the East Africa Royal Com- mission 1953-1955 Report". London, H.M.S.O. 1956 (Cmd. 9804).

ECONOMIST INTELLIGENCE UNIT. The Economy of East Africa: A study of trends. Prepared for the East African Railways and Harbours Administration, October, 1955. Nairobi 1956, pp. 237.

ECONOMIST INTELLIGENCE UNIT. An economic geography of the Commonwealth. Blackie 1957, pp. 296. - 19 -

HAIIEY, Lord. An African survey -- revised 1956: A study of problems aris- ing in Africa south of the Sahara. London, Oxford University Press for Royal Institute of International Affairs, 1957, pp. 1,800 (First pub- lished 1938).

ROBINSON, E. A. G. Report on the needs for economic research and investiga- tion in East Africa. Entebbe, 1955, pp. 26.

UNITED KINGDOM, Board of Trade. British East Africa: Economic and commer- cial conditions in British East Africa (Kenya, Uganda, Tanganyika and Zanzibar), April, 1952 by G. T. Dow-Smith. London H.M.S.O. 1953, pp. 156 (Overseas Economic Surveys). An earlier survey was published in 1948.

UNITED KINGDOM, Colonial Office. An economic survey of the colonial terri- tories, 1951: Vol. 11 -- The East African territories: Kenya, Tanganyika, Uganda, Zanzibar and the Somaliland Protectorate, with Aden, Mauritius and Seychelles, London, H.M.S.O., 1954, pp. 203 (Colonial No. 281-2).

UNITED KINGDOM, Colonial Office. Tanganyika under United Kingdom Adminis- tration, 1957 (annual), London, H.M.S.O.

TANGANYIKA. Statistical Abstract, 1958. Dar es Salaam, Government Printer, 1958.

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TANGANYIKA. Handbook of Tanganyika, 2nd ed. Edited by J. P. Moffett. Tanganyika, 1958.

UNITED NATIONS (Trusteeship Council). Report on Tanganyika by the United Nations Visiting Mission to Trust Territories in East Africa, 1957. Document T/1401. New York, 1958.

TANGANYIKA. Monthly Statistical Bulletin. Government Printer, Dar es Salaam.

Government and Constitution

TANGANYIKA. Report of the special commissioner appointed to examine mat- ters arising out of the report of the committee on constitutional development. (Commissioner, W. J. M. Mackenzie), Dar es Salaam, Government Printer, 1953, pp. 121.

Population

EAST AFRICAN STATISTICAL DEPARTMENT. African population of Tanganyika Territory: Geographical and tribal studies, 1948. Nairobi, revised edition, 1953, pp. 89, duplicated. - 20 -

TANGANYIKA. Report on the census of the non-native population taken on the night of 25th February, 1948. Dar es Salaam. Government Printer, 1953, pp. 73.

TANGANYIKA. Report on the census of the non-African population taken on the night of 13th February, 1952. Dar es Salaam, Government Printer, 1954, pp. 51

UNITED NATIONS. Department of social affairs. Population division. The Population of Tanganyika. New York, 1949, app. 151. (Reports on the population of trust territories, No. 2.)

See also: United Nations. "Additional information on the popula- tion of Tanganyika". (Supplement to above.) New York, 1953, pp. 32.

KUCZYNSKI, R. R. Demographic survey of the British colonial empire, Vol.II -- South Africa High Commission territories, East Africa, Mauritius, Seychelles. London, Oxford University Press for Royal Institute of International Affairs, 1949, pp. 983.

MARTIN, C. J. A demographic study of an immigrant community: the Indian population of British East Africa. Population Studies, VI, 3, March, 1953, pp. 233-47.

MARTIN, C. J. Some estimates of the general age distribution, fertility and rate of natural increase of the African population of British East Africa. Population studies VII, 2, November, 1953, pp. 181-99. Transport

GILLMAN, C. A. Short history of the Tanganyika Railways. Tanganyika Notes, 13, June, 1942, pp. 14-56.

TANGANYIKA. Tanganyika transport: A review by J. R. Farquharson, Dar es Salaam, Government Printer, 1945, pp. 96. Agricultare

BARCLAYS BANK, D.C.O. Tba and coffee, London, 1956, pp. 25.

BARCLAYS BANK, D.C.O. Sisal. London, 1956, pp. 27.

The East African agricultural journal. Nairobi Government Printer for E.A. Agriculture and Forestry Research Organization. Quarterly since July,1953.

East African farmer and planter. Nairobi, D. A. Hawkins, Ltd., monthly since October, 1956.

EAST AFRICAN STATISTICAL DEPARTPIENT. Report on the analysis of the sample census of African agriculture, 1950 (revised). Nairobi, 1953, pp. 46, duplicated. _ 21 -

TANGANYIKA DEPARTMENT OF AGRICULTURE. Agriculture in 'nrganyika. Dar es Salaam, Government Printer, 1945, pp. 60.

TANGANYIKA. The cotton industry 1939-1953. Dar es Salaam, Government Printer, 1953, pp. 29.

MATHESON, J. K. and BOVILL, E. W., ed. East African agriculture: A short survey of the agriculture of Kenya, Uganda, Tanganyika and Zanzibar, and of its principal products. London, Oxford University Press, 1950, pp. 332.

GUITJEBAUD, C. W. Econonic Survey of the Sisal Industry of Tanganyika. London, 1958.

Land Tenure

LIVERSAGE, V. Land tenure in the colonies. Cambridge University Press, 1945, pp. 151.

UNITED KINGDOM, Secretary of State for the Colonies. Report of the confer- ence on African land tenure in East and Central Africa, held at Arusha, Tanganyika, February, 1956. London, H.M.S.O., October, 1956, pp. 44. (Special supplement to the journal of African Administration.)

UNITED NATIONS (Trusteeship Council). Report by FAO on Land Tenure and Land Use Problems in Trust Territories of Tanganyika and Ruanda-Urundi. Document T/1438, 19 February, 1959 (mimeographed).

Industry

EAST AFRICAN STATISTICAL DEPARTMENT. Survey of industrial production in Dar es Salaam for 1954. Dar es Salaam, 1956, pp. 18, duplicated.

TANGANYIKA. Commerce and industry in Tanganyika 1957. Dar es Salaam, Department of Commerce and Industry, 1957, pp. 104.

TANGANYIKA. Minerals and industry in Tanganyika, by C. B. Bisset. London, H.M.S.O., 1955, pp. 13.

EAST AFRICAN TRADE AND INDUSTRY, Nairobi, D. A. Hawkins, Ltd., monthly since March, 1954.

EAST AFRICAN INDUSTRIAL COUNCIL. Some notes on industrial development in East Africa. Nairobi, Government Printer, 1956, pp. 63. Money and Banking

NEWLYN, W. T. and ROWAN, D. C. Money and banking in British Colonial Africa: A study of the monetary and banking systems of eight British African territories. Oxford, Clarendon Press, 1954, pp. 301. - 2 -

SAYERS, R. S. ed. Banking in the British Commonwealth. Oxford, Clarendon Press, 1952, pp. 486.

Public Finance

PEACOCK, A. T. and DOSSER, D. G. M. The National income of Tanganyika, 1952-1954. London, H.M.S.O., 1958, pp. 78 (Colonial research study No. 26).

TANGANYIKA. East African Statistical Department. Budget survey 1958-59. Dar es Salaam, Government Printer, 1958. (This is the third in a series.)

EAST AFRICA. Report of the East African commission of inquiry on income tax 1956-57. (Chairman, E. Coates) Nairobi, Government Printer, 1957, pp. 212.

WOODS, Sir Wilfrid. Report on a fiscal survey of Kenya, Uganda, and Tanganyika. Nairobi, Government Printer for Conference of East African Governors, 1946, pp. 178. Development Plans and Programmes

TANGANYIKA. A ten-year development and welfare plan for Tanganyika Terri- tory, by Bruce Hutt. Dar es Salaam,Government Printer, 1946, pp. 67. TANGANYIKA. Revised development and welfare plan for Tanganyika 1950- 1956. Dar es Salaam, Government Printer, 1951, pp. 40.

TANGANYIKA. Development plan 1955-1960: Capital works programme. Dar es Salaam, Government Printer, 1955, pp. 29.

TANGANYIKA. A review of development plans in the Southern Province -- 1953. Dar es Salaam, Government Printer, 1954, pp. 49. Labour

EAST AFRICAN STATISTICAL DEPARTMENT. Report on the enumeration of African employees in Tanganyika, July, 1952. Nairobi, 1953, pp. 81, dupli- cated.

GULLIVER, P. H. Labour migration in a rural economy. A study of the Ngoni and Ndendeuli of Southern Tanganyika. Kampala, E.A. Institute of Social Research, 1955, pp. 48 (East African Studies No. 6).

NORTHCOTT, C. H. ed. African labour efficiency survey. London, H.M.S.O. 1949, pp. 123. (Colonial research publication No. 3.)

ORDE BROINE, G. St. J. Labour conditions in East Africa. London, H.M.S.O. 1946, pp. 94. (Colonial No. 193.) - 23 ^

Cost of Living

EAST AFRICAN STATISTICAL DEPARTNENT. The pattern of income, expenditure and consumption of African labourers in Dar es Salaam, August, 1950. Nairobi, 1951, pp. 27, duplicated.

WRIGHT, F. C. African consumers in Nyasaland and Tanganyika: An enquiry into the distribution and consumption of commodities among Africans carried out in 1952-1953. London, H.M.S.0., 1955, pp. 117.

Education

TANGANYIKA. Report on Non-African Education by D. Riddy, C.B.E., H.M.I., and L. Tait, B.A., July, 1955, Dar es Salaam, Government Printer, 1955, pp. 92. LIST OF TABLES

1. Land utilization, overall and by province.

2. Population by province and by origin, 1957, and population density by province.

3. Population of thirteen principal towns, 1957.

4. Industrial distribution of African employees, 1957.

5. Occupational status of African adult male employees, 1957.

6. Gross domestic product by origin: a) narrow definition - f million, 1954-57. b) narrow definition - per cent of total, 1954-57. c) figures on narrow and wider definitions compared - per cent of total, 1956.

7. Use and supply of resources, 1954-57.

8. Pattern of expenditure on gross domestic product. a) including activity outside monetary economy, on "narrow definition". b) monetary economy only.

9. Gross domestic capital formation by sector, industrial use and type of asset, 1954-57. a) f million. b) percentage breakdown.

10. Total external and inter-territorial trade of Tanganyika, value, volume and price.

11. Commodity composition of total domestic exports to destina- tions outside East Africa, various periods fron 1921.

12. Changes in quantity of principal exports to destinations outside East Africa, 1925, 1935, 1938 and 1947-57,

13. Average value indices and recent price quotations for Tanganyika's principal exports.

14. Commodity composition of retained imports, 1956 and 1957.

15. Geographical distribution of external trade.

16. Principal destinations of exports in 1956 and 1957 and principal commodities exported to these destinations.

17. Principal destinations of Tanganyika's main exports, 1956-57. 18. Major items in Tanganyikats trade with Kenya and Uganda.

19. Elements of Tanganyika's balance of payments in 1956.

20. Production of main cash crops.

21. Miscellaneous indicators of growth of the Tanganyika economy in recent years.

22. Current budget of the central government.

23. Capital budget of the central government.

24. Functional analysis of total budgetary expenditure, cur- rent and capital.

Notes to tables

- nil or less than half of the last significant figure shown.

n.a. not available.

( 7 estimate, or figure not entirely on the same defini- tion as its neighbors.

( ) component of sub-total immediately above.

"Tons" are long tons.

All figures are rounded to last significant figure shown. Con- sequently components may not add exactly to totals.

Sources: Most of the principal statistics for Tanganyika are reproduced in the annual Tanganyika Statistical Ab- st-ract. Sources given without underlining are those cited in the Statistical Abstract. References to sour-ces outside the Statistical Abstract are under- lined. TABLE 1

Tanganyika - Land Utilization, Overall and by Province South ern Total Lake Central Tanga Southern Eastern Western Highlands Northern Tanganyika Province Province Province Province Province Province Province Province

Total land area,- thousand square miles 342.7 38.8 35.3 14.0 56.1 41.6 78.7 45.0 33.3 Vegetation actively induced by man - thousand square miles 30.0 8.2 4.9 1.5 4.7 2.9 4.2 2.3 1.3

Percentage of total

Vegetation actively induced by man 9 21 14 11 8 7 5 5 4

Forest and woodland 36 9 21 18 53 33 61 40 6

Woodland bushland intermediate, bushland and thicket 16 11 33 45 8 12 4 14 42

Wooded grassland and grassland 37 56 32 21 30 47 27 39 45

Swamp 1 2 1 1 - 1 2 1 1

Desert and semi-desert 1 - 1 4 - - 1 1 1

Source: Tanganyika Forest Departnent.

1/ Provinces are arranged in descending order of the percentage of total area covered by vegetation actively induced by man. TABLE 2 Pepulation by Province and by Origin, 1957 and Population Density by Province Density per Population - thousands sqare mile Indian Goan Culti- Province and and Dry vated Total African European Pakistani Arab other land landi/ Lake 2,246.2 2,228.5 2.3 10.0 4.3 1.1 59.3 274 Tanga 688.3 671.4 2.4 8.5 4.0 1.9 49.4 459 Eastern 1,084.6 1,039.8 6.2 29.5 5.2 3.9 26.3 369 Central 887.0 879.4 1.3 3.5 1.8 0.9 25.3 181 Northern 772.4 759.0 3.6 7.7 0.2 1.9 23.5 581 Southern Highlands 1,030.3 1,023.8 2.3 3.3 0.3 0.5 23.0 458 Southern 1,014.3 1,008.0 1.1 4.6 0.2 0.3 18.2 218 Western 1,062.6 1,052.8 1.3 4.4 3.1 1.0 13.8 251 Total Tanganyika 8,785.6 8,662.7 20.5 71.7 19.1 11.6 26.0 293

Source: East African Statistical Department. / Based on area of "vegetation actively induced by man" - c.f. Table 1. TABLE 3 Population of Thirteen Principal Towns, 1957 Number of persons Town Total African European Others Dar es Salaam 128,742 93,363 4,479 30,900 Tanga 38,053 27,973 768 9,312 Mwanza 19,877 15,241 366 4,270 Tabora 15,361 12,005 340 3,016 Morogoro 14,507 12,440 281 1,786 Moshi 13,726 9,399 441 3,886 Dodoma 13,435 10,386 350 2,699 Mtwara 10,459 9,617 207 635 Lindi 10,315 8,370 100 1,845 Arusha 10,038 5,161 878 3,999 Iringa 9,587 7,792 304 1,491 Mbeya 6,932 5,641 266 1,025 Mikindani 4.,807 4383 2 422 Total, thirteen towns 295,839 221,771 8,782 65,286 Percentage of total for the whole of Tanganyika 3% 3% 43% 64%

Source: East African Statistical Department. TABLE 4 Industrial Distribution of African Employees in Tanganyika, 1957 Number of persons Adult Adult Young persons Industry Total males females & children/ Agriculture, forestry & fishing 211,351 167,425 20,605 23,321 Mining and quarrying 12,975 12,441 200 334 Manufacturing and electricity 19,839 18,756 425 658 Construction 11,377 11,196 90 91 Transport and communications 8,157 8,131 3 23 Commerce 9,675 9,159 316 200 Miscellaneous services 12,777 11,,418 796 563 Public service 94,284 92,686 1,323 275 Total of above 3803435 331,212 23,758 25,465 Domestic service 50,00 L36,o007 n.a. n.a. Unclassified 10,03 n.a. n.a. n.a, Total, all African employees 530,4702 n.a. n.a. n.a.

Source: Labor Department. Includes all workers whose apparent age does not exceed 18 years.

TABLE 5 Occupational Status of African Adult Male Employees in Tanganyika, 1957

Occupation Number of persons Clerical 10,251 Shop, office and store hands 8,476 Drivers, mechanics and fitters 14,582 Carpenters and joiners 5,885 Masons and bricklayers 7,133 Teachers 4,571 Other services (excluding domestic service in private households) 3,561 Headmen (foremen) 15,803 Other skilled workers 31,219 Unskilled laborers 229,731 Total of above 331,212 Plus: Domestic service C 6,00o7 Unclassified n.a.

Source: Labor Department. TABLE 6a Gross Domestic Product of Tanganyika, by origin, 1954-57 - narrow definition &/ f million at factor cost 1957 (pre- liminary 1954 1955 1956 estimate) Agriculture 63.4 67.5 69.4 71.5 (of which: monetary economy (28.2) (29.7) (34.0) (32.6) subsistence sector) (35.1) (37.8) (35.4) (38.9) Livestock products 13.0 12.4 12.7 15.4 (of which: monetary economy (3.7) (3.6) (3.7) (3.9) subsistence sector) (9.3) (8.8) (9.0) (11.5) Forest products 3.0 3.2 3.6 3.7 (of which: monetary economy (3.0) (3.1) (3.5) (3.7) subsistence sector) (0.04) (0.03) (0.03) (0.03) Hunting and fishing 1.4 1.5 1.7 2.1 (of which: monetary economy (0.2) (0.2) (0.2) (0.1) subsistence sector) (1.2) (1.4) (1.6) (2.0) Mining and quarrying?/ 4.6 5.1 5.0 5.0 Manufacturing?/ 3.7 4.1 4.0 5.2 Construction 6.6 4.2 5.3 5.0 (of which: monetary economy 6:2) (3:7? (4.8) (4.4) subsistence sector) 0 .044 0 4 N5 Public utilities / 0.7 0.8 0.9 1.0 Transport, storage and communications?/ 8.0 8.5 9.0 10.0 Distribution2/ 7.0 7.6 7.6 7.8 Ownership of dwellings&' 2.6 2.7 2.9 3.1 Public administration and defense?/ 7.7 8.7 9.3 10.9 Miscellaneous services?/ 3e6 4.0 4.3 4.5 Total gross domestic product at 125.2 130.2 135.7 145.1 factor cost (of which: monetary economy (79.1) (81.8) (89.3) (92.3) subsistence sector) (46.2) (48.4) (46.4) (52.9) Source: East African Statistical Department; reproduced in Tanganyika Statistical Abstract, 1958. iJ Excluding certain forms of production in the subsistence sector, estimates for which are "nothing but reasoned guesses". Omitted activities include hut building and beer making by Africans. Estimates for these activities are included in Table 6c. / Production wholly within the monetary economy. TABLE 6b Gross Domestic Product of Tanganyika, by Origin, 1954-57 - narrow definition 2/ Per cent of total gross domestic product at factor cost 1957 (pre- liminary 1954 1955 1956 estimate) Agriculture 50.6 51.8 51.1 49.2 (of which: monetary economy (22.6) (22.8) (25.1) (22.4) subsistence sector) (28.1) (29.0) (26.1) (26.8)

Livestock products 10.4 9.5 9.3 10.6 (of which: monetary economy (3.0) (2.7) (2.7) (2.7) subsistence sector) (7. 4 ) (6.8) (6.6) (7.9)

Forest products 2.4 2.4 2.6 2.5 (of which: monetary economy (2.4) (2.4) (2.6) (2.5) subsistence sector) (0.03) (0.02) (0.02) (0.02)

Hunting and fishing 1.1 1.2 1.3 1.5 (of which: monetary economy (0.2) (0.1) (0.1) (0.1) subsistence sector) (1.0) (1.0) (1.2) (1.4)

Mining and quarrying 2 3.7 3.9 3.7 3.5 Mlanufacturing 3.0 3.1 3.0 3.6 Constxuction 5.3 3.2 3.9 3.4 (of which: monetary economy (4.9) (2.9) (3.6) (3.0) subsistence sector) (0.3) (0.3) (0.3) (0.4) Public utilities ? 0.5 o.6 0.7 0.7 Transport, storage & communications?/ 6.4 6.5 6.7 6.9 Distribution ? 5.6 5.9 5.6 5.4 Ownership of dwellings ? 2.0 2.1 2.1 2.1 Public administration & defense ? 6.1 6.7 6.9 7.5 Miscellaneous services 2.8 3.0 3.2 3.1

Total gross domestic product at 100.0 100.0 100.0 100.0 factor cost

(of which: monetary economy (63.1) (62.8) (65.8) (63.6) subsistence sector) (36.9) (37.2) (34.2) (36.4)

Source and notes: as for Table 6a. TABLE 6c Gross Domestic Product of Tanganyika, by Origin

- figures on narrow and wider definitions compared /l956 Per cent of total f million at factor gross domestic pro- cost tiuct t factor- cost Narrow Wider Narrow Wider definition definition definition definition Agriculture 69.4 74.4 51.1 48.8 (of which: monetary economy (34.0) (34.0) (25.1) (22.3) subsistence sector) (35.4) (40.3) (26.1) (26.5) Livestock products 12.7 12.9 9.3 8.5 (of which: monetary economy (3.7) (3.7) (2.7) (2.4) subsistence sector) (9.0) (9.2) (6.6) (6.0) Forest products 3.6 5.7 2.6 3.7 (of which: monetary economy (3.5) (3.5) (2.6) (2.3) subsistence sector) (0.03) (2.1) (0.02) (1.4)

Hunting and fishing 1.7 1.7 1.3 1.1 (of which: monetary economy (0.2) (0.2) (0.1) (0.1) subsistence sector) (1.6) (1.6) (1.2) (1.0) Mining and quarrying 5.0 5.0 3.7 3.3 Manufacturing 4.0 9.3 3.0 6.1 (of which: monetary economy (4.0) (4.0) (3.0) (2.6) subsistence sector) ( - ) (5.3) ( - ) (3.5) Construction 5.3 9.3 3.9 6.1 (of which: monetary economy (4.8) (4.8) (3.6) (3.2) subsistence sector) (0.4) (4.5) (0.3) (2.9) Public utilities ? 0.9 0.9 0.7 0.6 Transport, storage & communications 9.0 9.0 6.7 5.9 Distribution / 7.6 7.6 5.6 5.0 Ownership of dwellings 2.9 2.9 2.1 1.9 Public administration & defense 9.3 9.3 6.9 6.1 Miscellaneous services 4.3 4.3 3.2 2.8 Total gross domestic product at factor cost 135.7 152.4 100.0 100.0 (of which: monetary economy (89.3) (89.3) (65.8) (58.6) subsistence sector) (46.4) (63.1) (34.2) (41.4) Source: East African Statistical Department; reproduced in Tanganyika Statistical Abstract, 1958.

1/ By contrast with the "narrow definition", the "wider definition" covers certain forms of production, estimates for which can be "nothing but reasoned guesses". These activities include, notably, hut building and beer making by Africans. 2/ Production wholly within the monetary economy. TABLE 7

Use and Supply of Resources in Tanganyika, 1954-57 f million

Year-to-year changes at Annual figures current prices 1957 1956-1957 (preliminary 1954- 1955- (preliminary 1954 1955 1956 estimate) 1955 1956 estimate) Use of resources Private consumption 97.2 111.3 99.8 117.7 +14.2 -11.5 +17.9 General government consumption 12.0 13.5 14.9 16.8 + 1.5 + 1.4 + 2.0 Gross domestic capital formation 21.3 23.6 22.4 23.0 + 2.3 - 1.2 + o.6

(of which: private enterprises (11.1) (12.7) (13.1) (13.4) (+ 1.6) (+ 0.4) (+ 0-4) general government ( 5.1) ( 5.5) ( 6.4) ( 7.4) (+ 0.4) (+ 0.8) (+ 1.1) government enterprises) ( 5.1) ( 5.4) ( 3.0) ( 2.1) (+ 0.3) (- 2.4) (- 0.8) Exports 38.8 39.1 48.4 43.1 + 0.3 + 9.3 5,3 Total use of resources at 169.3 187.5 185.5 200.7 +18.2 - 2.0 +15.2 market prices

Supply of resources Gross domestic product at factor cost 125.2 130.2 135.7 145.1 + 4.9 + 5.6 + 9.4 Imports (c.i.f.) 37.8 49.1 42.2 47.0 +11.3 - 6.9 + 4.8 Plus: Taxes on expenditure 6.4 8.4 7.8 8.7 + 2.1 - 0.7 + 0.9

Less: Subsidies 0.1 0.2 0.2 0.1 + 0.1 - - 0.1 Total supply of resources at 169.3 187.5 185.5 200,7 +18.2 - 2.0 +15.2 market prices_

Source: East African Statistical Department. ._j Figures as given in the original. Include some activity outside the monetary economy ("narrow definition"). TABLE 8a

Pattern of Expenditure on Tanganyika's Gross Domestic Product 1954-57 a/

Percentage of gross domestic product at current market prices 1957 (pre- liminary 1954 1955 1956 estimate)

Private consumption 73.9 80.4 69.7 76.6 General government consump- 9.1 9.7 10.4 11.0 tion Gross domestic capital for- mation 16.2 17.1 15.6 15.0 (of which: private enter- prises (8.4) (9.2) (9.1) (8.7) general govern- ment (3.9) (4.0) (4h4) (4.8) government enter- prises) (3.9) (3.9) (2.1) (1.4) Exports 29.5 28.3 33.8 28.1

Less: Imports (c.i.f.) 28.8 35.5 29.5 30.6

Gross domestic product at market prices 100.0 100.0 100.0 100.0

Source: East African Statistical Department.

/ Figures as given in the original. Include some activity outside the monetary --conomy. TABLE Sb

Pattern of Expenditure on Tang ika's Gross Domestic Product,

1954-57 (Monetary Econoxy Only)

Percentage of gross domestic product at current market prices

1957 (pre- liminary 1954 1955 1956 estimate)

Private consumption 60.5 70.6 55.8 65.1

General government consump- tion 14.1 15.0 15.4 16.7

Gross domestic capital for- mation 24.2 25.5 22.5 22.0

(of which: private enter- prises (12.3) (13.4) (12.8) (12.5)

general govern- ment (6.0) (6.1) (6.6) (7.4)

government enter- prises) (6.0) (6.0) (3.1) (2.1)

Exports 45.5 43.5 50.0 42.8

Less: Imports (c.i.f.) 44.3 54.6 43.6 46.6

Gross domestic product at market prices 100.0 100.0 100.0 100.0

Source: East African Sta-tistical Department. TABLE 9a Gross Domestic Capital Formation in Tanganyika bxy Sector, Industrial Use and Type of Asset, 1954-57 f million 1954 1955 1956 1957 (preliminary BY SECTOR -estimate) Monetary economy Private 10.5 12.1 12.4 12.6 (of which: building & construction (4.8) (3.7) (4.2) (4.6) machinery & equipment) (5.7) (8.4) (8.2) (8.0) Public: general government 5.1 5.5 6.4 7.4 government enterprises 5.1 5.4 3.0 2.1 (of which: building & construction (6.8) (7.1) (7.4) (8.2) machinery & equipment) (3.4) (3.8) (1.9) (1.3) Subsistence sector - private building & construction&/ 0.6 o.6 o.6 0.8 Total (as in Tables 7 and 8)1/ 21.3 23.6 22.4 23.0 BY INDUSTRIAL USE Agriculture 2.0 1.9 2.0 2.2 Livestock and forestry - - - - Hunting and fishing 0.03 0.05 0.1 0.2 Mining and quarrying 1.1 0.9 1.1 1.3 Manufacturing 0.9 1.8 1.7 1.4 Construction 1.1 1.5 1.3 1.3 Public utilities 0.6 0.2 0.4 0.3 Transport, storage & communications 5.6 6.5 4.0 3.1 Distribution 1.0 1.8 1.7 1.6 Ownership of dwellings 3.8 3.5 3.9 4.3 Public administration & defense 4.7 5.0 5.7 6.6 Miscellaneous services 0.5 0.5 0.6 o.6 Total gross domestic capital formation 21.3 23.6 22.4 23.0 BY TYPE OF ASSET Building Dwellings 3.8 3.5 3.9 4.3 Non-residential buildings 3.3 3.1 3.8 4.4 Construction Water supply 0.5 0.8 1.2 1.7 Communications 2.1 1.6 1.4 1.4 Railways & harbors 1.8 1.8 1.1 1.0 Other construction & works 0.7 0.7 0.8 1.0 Equipment Transport equipment 4.7 7.5 5.3 4.2 Machinery and other equipment 4.4 4.7 4.8 5.1 Total gross domestic capital formation 21.3 23.6 22.4 23.0

Source and Note: see next page. TABLE 9a - cont'd.

Sources East African Statistical Department.

/ Estimates of capital formation outside the monetary economy, as used in the principal national accounting tables, cover only a relatively small amount of building and construction. Rough supplementary esti- mates, not included in the figures used in the principal tables, are available. These put African hut building and possibly some other building and construction outside the monetary economy, at around f4.3 million, No effort is made in the official national accounts to evaluate any other investment, or disinvestment, which may take place outside the monetary economy. TABLE 9b

Percentage Distribution of Gross Domestic Capital Formation in Tanganyika by Sector, Industrial Use and Type of Asset, 1954-57

Percentage of total gross domestic capital formation at market prices 1954 1955 1956 1957 (preliminary estimate) By sector Private enterprises 52.1 53.8 58.4 58.4 General government 24.0 23.4 28.3 32.4 Government entexprises 23.9 22.8 13.3 9.3 Total gross domestic capital 100.0 100.0 100.0 100.0 formation By industrial use Agriculture 9.4 7.9 9.1 9.6 Livestock and forestry - - - - Hunting and fishing 0.2 0.2 0.6 1.0 Mining and quarrying 5.3 3.9 4.7 5.6 Manufacturing 4.2 7.5 7.5 6.2 Construction 5.0 6.3 5.8 5.7 Public utilities 2.8 1.0 1.6 1.4 Transport, storage and com- munications 26.3 27.4 17.8 13.6 Distribution 4.8 7.4 7.4 6.8 Ownership of dwellings 17.7 14.9 17.5 18.7 Public administration & defense 22.1 21.2 25.3 28.9 Miscellaneous services 2.2 2.2 2.6 2.4 Total gross domestic capital 100.0 100.0 100.0 100.0 formation By type of asset BUILDING Dwellings 17.7 14.9 17.5 18.7 Non-residential buildings 15.6 12.9 17.1 19.1 CONSTRUCTION Water supply 2.5 3.4 5.2 7.2 Communications 9.8 6.9 6.3 5.9 Railways and harbors 8.3 7.5 5.1 4.3 Other constructional works 3.4 2.9 3.8 4.2 EQUIPMENT Transport equipment 22.2 31.7 23.7 18.4 Machinery & other equipment 20.5 19.9 21.4 22.2 Total gross domestic capital 100.0 100.0 100.0 100.0 formation

Source: East African Statistical Department. Note: Figures cover limited part only of capital formation outside the monetary economy: see note to Table 9a. TABLE 10

Total External and Inter-territorial Trade of Tanganyika, Value, Volume and Price, 1948-1957

1948 1949 1950 1951 1952 1953 1954 1955 1956 1957

-VALUE - f million Exports 16.6 21.4 25.4 41.5 48.3 36.8 38.8 39.1 48.4 43.1

(of which: external (15.1) (19.9) (23.2) (39.3) (46.5) (34.2) (36.2) (36.2) (44.9) (39.4) inter-territorial ( 1.2) ( 0.9) ( 0.9) ( 1.2) ( 0.9) ( 1.2) ( 1.1) ( 1.7) ( 2.1) ( 2.0) re-exoorts) ( 0.3) ( 0.6) (1.3) ( 1.0) ( 1.0) ( 1.4) ( 1.5) (1.2) ( 1.4) ( 1.6) Imports (c.i.f.) 22.2 28.8 28.1 31.7 41.9 33.9 37.8 49.1 42.2 47.0 (of which: extermal (20.1) (25.5) (24.2) (28.1) (37.5) (28.4) (32.0) (43.5) (35.9) (39.3) inter-territorial) ( 2.1) ( 3.2) ( 3.9) ( 3.6) ( 4.5) ( 5.5) (5.9) ( 5.6) ( 6.3) ( 7.7) Trade balance (imports c.i.f.) -5.7 -7.4 -2.7 +9.8 +6.4 +2.9 +1.0 -10.0 +6.2 -3.9

INDICES - 1955-57 = 100 Domestic Exports Value 39 50 57 96 113 84 89 90 112 98 Volume 44 n.a. 58 n.a. 83 79 83 92 107 101 Price (unit value) 78 n.a. 105 n.a. 143 111 109 99 104 97 Imports Value 48 62 61 69 91 74 82 107 92 102 Volume n.a. n.a. 67 n.a. 75 67 84 108 89 103 Price (unit value) / n.a. n.a. 91 n.a. 121 110 98 99 102 99 Terms of trade n.a. n.a. 116 n.a. 119 101 112 100 102 98 Source: East African Statistical Department. 2/ Obtained by dividing value index by the average value index for the imports of the three East African terri- tories. This method, while unsatisfactory, is the only feasible one. 2/ For the three East African territories combined. TABLE 11

Commodity Composition of Tanganyika's Total Domestic Exports to Destinations Outside East Africa

Per cent of total, by value 1948 & 1952 & 1956 & Commodity 1921 1938 1949 1953 1957 Sisal 20 35 57.3 42.7 24.1 Coffee 11 10 6.7 14.1 19.4

Cotton 10 9 9.7 11.8 16.7

Diamonds - 0.1 7.8 7.2 7.2

Lead ore and concentrates - L .9 2.9

Hides and skins 2 5 3.1 3.4 2.9

Cashewnuts 0.5 1.2 2.8

Groundnuts 0.4 0.9 2.5

Castor seed 0.4 1.9 1.9

Sesame seed n.a. 0.1 1.4

Other seeds, nuts, kernels . 1.6 2.1

Gold 3.4 2.2 1.7 Tea 0.4 0.8 1.4

Wood, lumber and cork 0.8 0.8 1.3 Pyrethrum 0.1 O.1 0,2

Tobacco, unmanufactured 1.3 0.3 O.1 Other 6.5 10.4 11.3

Source: Annual Trade Reports. TABLE 12

Changes -inQuant.ity-of Principal Exports from Tanganyika to Destinations Outside East Africa

Average Average Index: average quantity 1956-57 = 100 annual qua-ntity, 1925 1935 1938 1947 1948 1949 1950 1951 1952 1953 1954 1955 1956 1957 value, 1956-57 1956-57, (thousand :f million tons unless othenrise Commodity stated)

Sisal 10.2 l83.7 10 45 55 52 64 72 65 77 86 93 91 95 101 99 Coffee, hulled 8.2 19.8 ,g7 Z37 L67 57 62 60 75 83 94 77 98 93 109 91 Cotton 7.0 27.6 16 36 32 26 36 39 25 30 40 54 44 74 101 99 Diamonds 3.1 365,361 - - 1 25 41 53 19 2 91 47 90 88 98 102 carats Lead ore and 1.2 13.8 59 109 91 concentrates

Hides, skins & 1.2 10.4 56 115 106 99 101 furskins million lbs. Cashew nuts 1.2 25.2 22 14 26 33 46 45 65 72 66 134 Groundnuts 1.0 15.6 23 20 5 1 22 60 7 16 36 97 103 Tea 0.6 2.1 24 38 48 53 77 81 95 105 For comparison:

Export volume index 43 59 80 76 80 89 103 97

Sources: Annual Trade Reports; Digest of Colonial Statistics. TABLE 13

Average Value Indices and Recent Price Quotations for Tanganyika's princioal exports

All Sisal Cotton Coffee Diamonds exports

Average value: Index - 1956-57 100 1948 138 53 20 77 1949 152 75 30

1950 181 81 57 139 105

1951 302 131 66 1952 249 165 74 142

1953 135 128 94 124 110 1954 118 109 127 113 109

1955 104 106 92 118 98

1956 106 105 105 96 104 1957 94 95 95 104 96

Price quotations

Quality No. 1 U.S.A. Santos London 15/16" No. 4, -(.per ton) middl- New ing York New (cents York per spot lb.) (cents per.lb.)

May 1957 70 35.4 57.8

May 1958 69 36.3 50.0

May 1959 100 36.3 37.3 TABLE 34

Commodity Composition of Tanganvika's Retained Imports. 1956 and 1957

Per cent of total By S.I.T.C. grouP

Food 6.8 Beverages and Tobacco 0.8 Crude materials, inedible, except fuels -0.3 Mineral fuels, lubricants and related materials 8.1 Animal and vegetable oils and fats 0.7 Chemicals 4.8 Manufactured aoods classified chiefly by material 40.7 M&chinery and transport equipment 27.1 Miscellaneous manufactured articles 7.6 Miscellaneous transactions and commodities n.e.s. 3.7

Total lCO.0

By stage of production and use Total Government Other

Food, drink and tobaccol! 7.6 _ 7.6 Producerst materials2i 33.7 4.6 29.1 Producers' capital goods2/ 21.6 4.6 17.0 Spares and access4ies 4.0 0.8 3.2 Consumers' goo4s4/ 29.4 1.7 27.7 Miscellaneous/ 3.7 0.2 3.4

Total 100.0 12.0 88.0

Source: East African Statistical Department. 1J Includes certain material for the production of food and also un- manufactured tobacco. 2 Includes feeding stuffs for animals; oilseeds and nuts; processed oils and fats; all aviation and motor spirit; all fuel oils, lubricating oils and greases. 2/ Excludes private motor cars, motor cycles, cycles and domestic appliances, furniture and fixtures; all of these are included under "Consumer's goods". / Includes private motor cars, motor cycles, cycles and tyres and tubes for same; domestic appliances including refrigerators; sewing machines; wirteless sets and radiograms; wood and metal; furniture and fixtures and other household utensils; all cotton and other pieceg6ods; blankets; all articles of clothing and footwear. / Includes all imports by parcel post, livestock not for food, and gold and silver. TABLE 12

Geographical Distribution of Tanganyika's Exterral Trade Per cent of total

1950 1951 1952 1953 1954 1955 1956 1957 Destination of Excports {excluding reexports) United Kingdom 39.1 39.4 40.3 38.3 34.1 35.0 29.9 29.2 Kenya and Uganda 3.7 2.8 2.0 3.5 2.8 4.5 4.4 4.9 Other sterling coun- tries 19.9 17.8 14.3 15.2 16.0 18.1 17.5 20.9 Total, sterling area 62.8 60.1 56.6 57.0 52.9 57.5 51.8 55.0 United States and Canada 11.5 19.9 22.7 17.7 15.8 10.9 9.3 8.5 Non-sterling O.E.E.C. countries 20.1 19.0 18.3 20.5 26.8 26.2 33.6 29.7 Others 5.6 1.0 2.4 4.9 4.4 5.3 5.2 6.7 Total 100.0 1CO.O 100.0 100.0 100.0 100.0 100.0 100.0 Origin of Imports lJ United Kingdom 48.3 39.4 42.1 39.5 36.3 36.2 L8.g0.27 Kenya and Uganda 14.0 11.4 10.6 16.3 15.5 11.4 15.0 16.4 Other sterling coun- tries 14.2 17.3 18.2 19.8 23.9 16.8 L14.Z7 LT3.7 Total, sterling area 76.5 68.1 70.9 75.6 75.6 64.4 L67.2/ L60./

United States and - Canada 5.7 3.9 4.2 6.1 2.8 2.6 2.27 L2.2 Non-sterling O.E.E.C. countries 7.6 14.8 15.0 12.5 14.8 18.7 /16. 113.1 Others 10.1 13.2 8.3 3.1 3.3 11.4 Ll /1.21.2 Unallocated - - 1.6 2.7 3.5 2.9 L2. L2.§ … Total 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0

Source: East African Statistical Department and Annual Trade Reports. l/ 1956 and 1957 figures for imports originating outside East Africa ("external imports") cover "direct imports" only: this is to say, they exclude imports arriving by way of Kenya or Uganda. For these two years, direct imports were 92% and 88% of total external imports. In this table, it has been assumed that the ratio of direct imports to total external imports is the same for imports from each source. This is unlikely to be the case in practice. TABLE 16

Principal Destinations of Tanganyikals Exports in 1956 and 1957,

and Principal Commodities Exported to these Destinations

Figures are average exports in 1956-57, in f '000

Destination Total Exports Of which:

United Kingdom 13,066 Sisal 3,350 Diamonds 3,054 Coffee - - - - 1,885

Germany 4,745 Coffee - - - - 1,557 Cotton - - - - - 1,367 Sisal - - - - 893

United States 3,372 Coffee - - - - 2,306 Sisal - - - - - 662

Belgium 2,930 Sisal --- -- 1,009

India 2,732 Cashew nuts - - 1,190 Cotton - - - - - 1,176

Netherlands 2,240 Sisal - - - - - 789 Coffee - 360

Source: Annual Trade Reports. TABLE 17

Principal Destinations of Tanganyikats Main Exports, 1956-57 -/

Figures following countries are percentage of total exports of commodity to destinationsoutside East. Africa in 1956 and 1957.

Average va±Lue of total exports Commodity 1956-57 (vooo) Destinations

Sisal 10,153 United Kingdom - 33% Belgium - - - - 10% Germany 9% United States - 7%

Coffee 8,190 United States - 28% Germany - - - - 19% Australia - - -- 5%

Cotton 7,032 Germany - - - - 19% India - - - - - 17% United Kingdom - 8%

Diamonds 3,054 United Kingdom -100%

Hides, skins and 1,211 United Kingdom - 40% United States - 14% Netherlands - 13% Italy - -- - 12% furskins Cashew nuts 1,198 Indiar- - - - - 99%

Groundnuts 1,045 United Kingdom - 42% Netherlands - - 13%

Source: Annual Trade Reports.

X~] Exports to Hong Kong and Japan are not covered in this table. They may well be relatively important for certain items. TABLE 18

Major Items in Tanganyika's Trade with Kenya and Uganda f'000 1951 1952 1953 1954 1955 1956 1957 Exports

Tobacco, umanufactured 123 113 72 43 329 269 450 Coconut oil 119 113 183 147 169 189 159 Wood, lumber & cork 142 114 78 139 165 172 152 Beans and peas, etc. 60 90 140 98 221 178 136 Hides, skins & fur skins 89 42 80 34 70 157 45 Electric energy n.a. n.a. n.a. 42 73 81 68 Sugar & sugar pre- - 1 88 34 45 117 10 parations Other 618 463 586 516 629 924 1.011

Total 1,151 935 1,227 1,053 1,701 2,087 2,031

Imports

Cigarettes 1,288 1,815 2,138 2,362 2,685 2,939 3,147 Beer 111 300 344 424 500 517 488 Wheat flour 349 517 582 581 612 385 506 Clothing & footwear 285 249 185 274 314 354 347 Manufactures of metals n.a. n.a. n.a. 181 194 317 283 Tea 144 199 175 242 61 204 387 Sugar & sugar pre- 216 185 287 46 55 140 356 parations Cement - 4 3 23 33 146 312 Other 1,232 1,183 1,805 1,723 1,159 1,347 1,900 Total 3,625 4,452 5,519 5,856 5,613 6,349 7,726

Source: East African Statistical Department and Annual Trade Reports.

Note: Exports are for use in Kenya and Uganda and imports for use in Tanganyika. TABLE 19

Elements of Tanganyika's Balance of Payments in 1956

2000

Current account Credit Debit Balance

Merchandise!/ 48,394 42,234 +6,160 Government interest 324 434 -110 Government payments to War Department - 642 -642 Government pension payments 415 -415 Crown and other Agents' charges - 52 -52 Transactions with East African High Commission 650 89L -241 Miscellaneous government payments - 58 -58 Education costs - 262 -262

Capital account Colonial Development and Welfare Grants 841 - +841 Government borrowing from official sources - 79 -79 Security transactions of public sector 526 112 *414 Change in sterling assets +3,961 Change in other external assets -7 Balance of other transactions, both current and capital -9,510

Source: East African Statistical Department; Iden: An Estimate of the Balance of Payments of East Africa for the year 1956. PublicFinance in 9dem:East Africa, an.Analysis 1959).

2/ Imports c.i.f. TABLE 20

Production of Main Cash Crows in Tanganyika

Average Index: average Quantity 1956-57 = 100 quantity 1938 1939 1947 1948 1949 1950 1951 1952 1953 1954 1955 1956 1957 1956-57 Commodity (tons) Sisal fibre & tow 185,300 55 50 57 65 67 66 78 88 91 96 95 100 100 Coffeei/: African 16,350 n.a. n.a. n.a. n.a. 64 72 81 81 84 104 96 98 102 estate 5,300 n.a. n.a. n.a. n.a. 28 36 40 30 28 45 62 96 104 Tea 2,600 LO LF7 23 26 24 30 40 42 49 62 77 92 108 Tobacco: fire cured 500 84 102 52 146 210 292 162 118 76 172 118 106 94 flue cured 1,560 n.a. 1 21 54 49 82 79 68 63 102 97 97 103 total 2,060 n.a. 25 29 77 88 133 100 80 66 119 102 100 100 Cotton lint2/ 26,900 29 42 26 36 34 33 31 52 33 68 80 88 112 Sugar 18,200 27 L34J 42 34 42 47 45 55 64 53 64 99 101 Pyrethrum (dried flower) 740 El L47 69 34 32 39 41 32 39 65 86 100 100 Oilseeds3-/ 89,350 n.a. n.a. n.a. n.a. n.a. n.a. n.a. 64 48 61 66 88 112 Wheat 4,8o0 52fl I5q7 148 90 102 169 121 110 102 204 77 100 n.a.

Source: Agricultural Department. 1/ Clean coffee. 2/ Lint equivalent of seed cotton delivered. J/ Includes groundnuts, copra, cashew nuts, castor seed, sesame seed and sunflower seed. 4/ 1956 only. General note: For the crops shown, deliveries at some stage in the course of processing and marketing give a good indication of production. The figures are not fully comprehensive however. E.g. some labor is con- sumed direct by African growers and some "buni" production by-passes the coffee hulleries. TABLE 21

Miscellaneous Indicators of the Growth of the Tanganyika Econo!M in Recent Years

Index, average 1956-57 = 100 Average quantity, Item 1956-57 1948 1949 1950 1951 1952 1953 1955 1956 14

Cement consumption 121,587 tons 41 69 91 93 89 105 91 133 96 104

Licensed private motor vehicles 27,940 68 79 87 94 106

Total electricity sales2i 110.3 million kWh 22 29 36 50 58 66 77 87 97 103

Cotton piece goods-/ and arti- 84.9 million sq. 58 57 73 60 923' 1143' 81/ 119 ficial textile fabrics - yds retained imports

African primary education - 345,856 47 51 58 62 71 80 90 97 103 number of pupils enrolled

Source: Statistical abstract, various tables.

1/ Including exports to Mombasa.

2/ Excluding blankets.

3] Including artifical silk piece goods. TABLE 22

Current Budget of the Central Government of Tanganyika 21000 1952 1954/5 1955/6 1956/7 1957/8 1958/9 Revenue est. est. Direct Taxation 4,989 5,901 6,021 5,579 6,443 6,082 Indirect Taxation 7,358 7,615 8,113 7,925 8,782 9,848 Provision of Goods & Services 681 888 994 1,104 1,288 1,430 Goverment Property 2,117 1,768 1,839 1,786 1,759 1,688 Miscellaneous 520 2,013 1,038 1,074 747 733 Poll Taxes Transferred to Local Authorities 713 904 317 24 8 6 Transfers from Reserve 52 188 358 - - - Total Revenue 16,430 19,277 18,680 17,492 19,027 19,787

Functional Analysis of Sources 1. Taxes on Income 4,966 5,847 5,996 5,570 6,381 6,052 2. Taxes on Expenditure 5,965 7,153 8,242 8,023 8,955 10,033 3. Export Duties 1,330 505 19 24 20 25 4. Income from Property 1,678 2,055 1,874 2,033 2,200 2,212 5, Provision of Goods & Services 473 682 710 698 780 851 6. Other Income 185 395 338 190 70 346 Total 14,597 16,637 17,179 16,538 18,406 19,519 Adjustments 1,833 2,640 1,501 954 621 268 Total Revenue 16,430 19,277 18,680 17,492 19,027 19,787

Expenditure Social Services 2,478 3,912 4,538 4,775 5,552 5,857 Economic Services 1,711 2,899 3,390 3,683 4,024 4,259 Maintenance of Law & Order 945 1,687 1,854 2,053 2,078 2,221 Defence 296 588 604 652 679 673 2,104 Administration 1,010 1,390 1,423 1,573 1,668 Pensions & Gratuities 534 683 772 880 927 921 Local Government 315 764 623 657 624 689 1,184 Publ;c Debt 229 561 543 715 916 Revenue Collection, etc. 344 405 443 476 587 625 Unallocated Items 4,759 2,677 3,984 2,359 2,524 2,418 Total 12,621 15,566 18,174 17,823 19,579 20,951

Poll Tax Receipts Transferred Local Authorities 713 904 317 24 8 6 to - Transfers to Reserves 2,544 1,231 1,041 310 3 Total Expenditure 15,878 17,701 19,532 18,157 19,590 20,957

Source: Budget Survey 1958-59. TABLE 23

Capital Budget of the Central Government of Tanganyika

f1000

1952 1954/5 1955/6 1956/7 1957/8 1958/9 Sources of Funds est. est.

Development Fund 1,645 491 466 637 1,131 1,068 Loans (including Advances) 1,924 2,015 2,271 3,200 3,539 2,674 Colonial Development & WJelfare & other Grants 1,080 530 677 922 1,219 1,589 Custodian of Enemy Property Funds - - 450 523 738 693 Total 4,649 3,036 3,864 5,282 6,627 6,024

Agricultural Development Reserve 340 301 220 - - -

Total 4,989 3,337 4,084 5,282 6,627 6,024

Expenditure

Natural Resources 752 640 584 599 900 1,258 Communications 2,210 1,385 1,197 966 975 921 Township Development 367 350 570 1,292 1,166 931 Public Buildings & Works 1,213 335 707 942 1,581 1,134 Social Services 387 594 1,020 1,445 1,893 1,668 Miscellaneous 60 33 6 38 112 112 Total 4,989 3,337 4,084 5,282 6,627 6,024

Source: Budget Survey 1958-59. TABLE 24

Functional Analysis of Total Budgetary Expenditure, Current and Capital

£1000

1952 1954/5 1955/6 1956/7 1957/8 1958/9 Heads of Expenditure Est. Est.

ECONOMIC SERVICES: 5,653 5,837 6,38 7,333 7,445 8,536

Agriculture, Forests, Veterinary 1,631 1,805 1,752 1,879 1,998 2,563 Mines and Surveys 354 429 484 648 526 593 Water Supply Develop- ment* 583 763 1,104 1,979 1,807 1,990 Roads 2,196 2,023 1,987 1,766 1,870 1,910 Railways 10 8 195 177 180 180 Aviation and Meteor- ology 455 423 292 266 332 298 Other 136 197 214 251 281 405 Township Development 119 70 159 182 186 316 African Urban Housing 169 119 197 185 265 281

SOCIAL SERVICES: 3,179 4,652 5,604 6,176 7,455 8,059

Education 1,801 2,841 3,382 3,806 4,744 5,271 Medical 1,174 1,575 1,864 2,139 2,401 2,386 Other 204 236 358 231 310 402

ADMINISTRATION, LAW AND ORDER: 3,005 4,477 4,936 5,337 5,790 6,512 - -- Central and Local Administration 1,177 1,770 2,018 2,147 2,253 2,696 Law, Order and Defence 1,454 2,297 2,474 2,714 2,950 3,191 Revenue Control and Collection 374 410 444 476 587 625 GENERAL EXPENDITURE: 6,049 4,523 4,238 3,149 4,495 3,919

Public Works 1,959 1,402 1,468 1,700 2,066 1,719 Other general recur- rent items 1,722 2,264 2,715 2,050 2,392 2,277 Other general non-re- current items 2,368 857 55 -601 37 -77

Total current and capital expenditure excl. de- preciation 17,886 19,489 21,162 21,995 25,185 27,026 Total adjustments 2,981 2,001 2,452 1,4k4 1,031 -45 Total expenditure as shown on Government Accounts 20,867 21,490 23,614 23,439 26,216 26,981 * Including urban water supplies. Source: Budget Survey, 1958-59.