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Tanzania Comoros COUNTRY REPORT Tanzania Comoros 2nd quarter 1996 The Economist Intelligence Unit 15 Regent Street, London SW1Y 4LR United Kingdom The Economist Intelligence Unit The Economist Intelligence Unit is a specialist publisher serving companies establishing and managing operations across national borders. For over 40 years it has been a source of information on business developments, economic and political trends, government regulations and corporate practice worldwide. The EIU delivers its information in four ways: through subscription products ranging from newsletters to annual reference works; through specific research reports, whether for general release or for particular clients; through electronic publishing; and by organising conferences and roundtables. The firm is a member of The Economist Group. London New York Hong Kong The Economist Intelligence Unit The Economist Intelligence Unit The Economist Intelligence Unit 15 Regent Street The Economist Building 25/F, Dah Sing Financial Centre London 111 West 57th Street 108 Gloucester Road SW1Y 4LR New York Wanchai United Kingdom NY 10019, USA Hong Kong Tel: (44.171) 830 1000 Tel: (1.212) 554 0600 Tel: (852) 2802 7288 Fax: (44.171) 499 9767 Fax: (1.212) 586 1181/2 Fax: (852) 2802 7638 Electronic delivery EIU Electronic Publishing New York: Lou Celi or Lisa Hennessey Tel: (1.212) 554 0600 Fax: (1.212) 586 0248 London: Moya Veitch Tel: (44.171) 830 1007 Fax: (44.171) 830 1023 This publication is available on the following electronic and other media: Online databases CD-ROM Microfilm FT Profile (UK) Knight-Ridder Information World Microfilms Publications (UK) Tel: (44.171) 825 8000 Inc (USA) Tel: (44.171) 266 2202 DIALOG (USA) SilverPlatter (USA) Tel: (1.415) 254 7000 LEXIS-NEXIS (USA) Tel: (1.800) 227 4908 M.A.I.D/Profound (UK) Tel: (44.171) 930 6900 Copyright © 1996 The Economist Intelligence Unit Limited. All rights reserved. Neither this publication nor any part of it may be reproduced, stored in a retrieval system, or transmitted in any form or by any means, electronic, mechanical, photocopying, recording or otherwise, without the prior permission of The Economist Intelligence Unit Limited. All information in this report is verified to the best of the author’s and the publisher’s ability. However, the EIU does not accept responsibility for any loss arising from reliance on it. ISSN 0269-6776 Symbols for tables “n/a” means not available; “–” means not applicable Printed and distributed by Redhouse Press Ltd, Unit 151, Dartford Trade Park, Dartford, Kent DA1 1QB, UK 1 Summary Tanzania, Comoros 2nd quarter 1996 June 3, 1996 Tanzania Political and economic structures Pages 3-4 Outlook: The political deadlock in Zanzibar will remain a serious problem for the president and will harm relations with donors until a solution is found. On the mainland, Mr Mkapa faces a difficult task in fighting entrenched corrup- tion and mismanagement, and in overhauling the party state apparatus. His drive against the worst bureaucratic excesses will win him friends among the donors, but few within the ruling CCM. Tight budget targets, if adhered to, will help reduce inflation and represent a major step towards macroeconomic stability. Depending upon the gravity of future developments in Zanzibar, a renewal of IMF lending can be expected under an ESAF, which may in turn trigger a much-needed restructuring of external debt. Following a period of rather surprising strength against the dollar, the shilling will depreciate swiftly, averaging TSh680:$1 in 1997. Pages 5-8 Review: Mr Mkapa has finally acknowledged the potentially dangerous nature of the political stand-off in Zanzibar, after having spent several months avoiding the issue. An increasingly hard line from donor governments may have helped his concentration. The opposition CUF has been controlling the news agenda amid allegations that its supporters, mostly from the northern isle, Pemba, have been persecuted by the CCM administration of the Zanzibari president. Among many diplomatic initiatives, Mr Mkapa has initialled the protocol setting up the East African Cooperation secretariat and concrete meas- ures have been taken to boost regional integration with Kenya and Uganda. Macroeconomic stabilisation has continued as the impact of the presidential election recedes. Money supply has actually contracted, despite low interest rates. The inflation rate is coming down and the shilling has resumed its downwards path against the dollar. Fiscal reform and a clearout of corrupt officials have been signalled and several parastatal boards have been dissolved. A survey has underlined the extent of poverty. Coffee output has risen, al- though speculative traders have been caught out by falling prices. Canadian involvement has continued in the mining sector, although the internal wran- gling at Sutton Resources has diverted attention from elsewhere. Tender bids have been invited for the Songosongo pipeline contract. The South Africa- owned Tanzania Breweries Limited goes from strength to strength, while the Parastatal Sector Reform Commission is adopting a higher public profile, and tourism is being accorded higher governmental priority. The transport sector has suffered strikes, power cuts and a disaster on Lake Victoria. The EIU’s index of export unit values has stabilised after falling in late 1995. Multilateral debt service remains the country’s biggest external burden. Pages 8-22 EIU Country Report 2nd quarter 1996 © The Economist Intelligence Unit Limited 1996 2 Comoros Political and economic structures Pages 23-24 Outlook: France, Comoros’ main foreign partner, will probably build a reason- able working relationship with the newly elected president, Mohamed Taki Abdulkarim. Fiscal austerity and further privatisations will continue to head the donors’ wishlists. Pages 25-26 Review: Mr Taki has won the presidency after several defeated first-round candidates transferred their allegiances to him, against Abbas Djoussouf, criti- cised as being “France’s candidate”. This loyalty has resulted in a number of them being offered cabinet positions. Mr Taki has initiated political reforms, but has not yet arrived at a distinctive economic policy. The economic situ- ation is still dire, although revenue collection has reportedly improved. The privatisation programme remains sluggish. Pages 26-32 Statistical appendices Pages 33-36 Editors: Andrew Manley; Gregory Kronsten All queries: Tel: (44.171) 830 1007 Fax: (44.171) 830 1023 EIU Country Report 2nd quarter 1996 © The Economist Intelligence Unit Limited 1996 Tanzania 3 Political structure: Tanzania Official name: United Republic of Tanzania Form of state: republic, formed by the 1964 union of Tanganyika and Zanzibar Legal system: based on English common law, the 1977 Union and 1985 Zanzibari constitutions, as amended National legislature: National Assembly, comprising 269 members (232 directly elected and 37 women appointed); elected members are chosen by Union-wide adult suffrage every five years; Zanzibar has its own House of Representatives of 59 members (9 women appointees) legislating on internal matters Last elections: October-November 1995 (legislative and presidential) Next elections: 2000 (legislative and presidential) Head of state: president, elected by universal adult suffrage every five years National government: the president, vice-president and Council of Ministers; last reshuffled November 1995 Main political parties: the ruling Chama Cha Mapinduzi (CCM); Civic United Front (CUF); National Convention for Construction and Reform (NCCR-Mageuzi); United Democratic Party (UDP); Chama Cha Demokrasia na Maendeleo (Chadema) President Benjamin Mkapa Vice-president Omar Ali Juma Prime minister Frederick Sumaye Key ministers agriculture & cooperatives Paul Kimiti community development, women’s affairs & children Mary Nagu communications & transport William Kusisla defence Edgar Majogo education Juma Kapuya energy & minerals William Shija finance Simon Mbilinyi foreign affairs Jakaya Kikwete health Zakia Meghji home affairs Ali Ameir Mohammed justice & constitutional affairs Bakari Mwapachu labour & youth development Sebastian Kinyondo lands, housing & urban development Gideon Cheyo natural resources & tourism Juma Ngasongwa science, technology & higher education Jackson Makweta trade & industry Abdallah Kigoda water & livestock development Pius Ng’wandu works Anna Abdallah Governor of the central bank Idris Rashidi EIU Country Report 2nd quarter 1996 © The Economist Intelligence Unit Limited 1996 4 Tanzania Economic structure: Tanzania Latest available figures Economic indicators 1991 1992 1993 1994 1995a GDP at market pricesb TSh bn 626 766 962 1,249 n/a Real GDP growthb % 0.7 2.6 4.4 3.5 3.5 Consumer price inflationb % 22.2 23.1 25.3 34.1 27.0 Populationc m 25.2 25.9 26.7 27.4 28.2 Exports fob $ m 362 401 462 519 550 Imports cif $ m 1,285 1,314 1,300 1,505 1,450 Current account $ m –451 –422 –409 –390 –400 Reserves excl gold $ m 203.9 327.3 203.3 332.1 270.2d Total external debt $ m 6.689 6,781 6,963 7,442 n/a External debt-service ratio % 39.8 40.8 29.2 20.4 n/a Coffee productione ’000 tons 37.7 52.2 56.3 48.5 49.0d Cotton (lint) productiond ’000 tons 49.2 90.7 105.3 50.7 37.0 Manufacturing indexb (1985=100) 117 110 110 101f n/a Exchange rate (av) TSh:$ 219 298 405 510 575d May 31, 1996 TSh565.0:$1 Origins of gross domestic product 1994b % of total Components of gross domestic product 1993b % of total Agriculture, forestry & fishing 57.1 Private consumption 81.6 Trade & hotels 15.3 Government consumption
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