In the recent years, the economic performance of Tanzania at macro level has been impressive and
its improvement has been one of the highest in Sub-Saharan Africa (SSA). Furthermore, macroeconomic
stability and growth has been ensured by a notable fiscal policy progress (The United
Republic of Tanzania, 2003).
Despite these achievements, the macro-economic gains are difficulty transferred into poverty
reduction and the enhancement of the poverty impact of growth is one of the major concerns of the
Government of Tanzania both in terms of understanding the dynamics at work, and of designing
policy responses (IMF and IDA, 2003). The country, committed to a Poverty Reduction Strategy
(PRS) and the Millennium Development Goals, has put in place a sound policy framework for
poverty reduction which is primary income poverty. In this context, the challenges brought about
by the forces of globalization for promoting economic growth and a sustainable development,
considered as critical for fighting poverty, have been taken into account. To this end, the
Government has introduced industrial and trade policies aimed at increasing regional and
international competitiveness and has promoted a privatisation process for the enhancement of
private sector development. Improving efficiency in production, processing and marketing of
current and potential exports in order to encourage the competitiveness of the country on the world
market is part of this strategy and agriculture is one of the priority sectors (The United Republic of
Tanzania, 2003).