• Msuya points finger at global oil prices
  • Tanzania-Uganda war
  • Collapse of former East Africa Community

Did Ujamaa policy occasion Tanzania’s economic collapse? At least, not in Cleopa David Msuya’s thinking.

The former Prime Minister and First Vice-President has vehemently denied that Mwalimu Julius Kambarage Nyerere’s socialism policy necessitated the country’s collapse on the economic front. He responded during an interview with a team of writers from Tanzania Standard (Newspapers) Limited (TSN) who recently paid him a visit at his birthplace, Chomvu village in Usangi Division, Mwanga District in Kilimanjaro Region.

According to the sharpminded nonagenarian, there was more to Socialism Policy than what befell the country in the late 1970s and early 80s. “Many have linked Tanzania’s economic downfall to socialism and the industrial crisis, which is utter falsehood,” he asserts.

The main reason, according to the retired politician, was the infamous decision by the Organisation of the Petroleum Exporting Countries (OPEC) of increasing global oil prices by 200 per cent, in 1973 and 1979.

“Much as we were importing oil, the price ate up on other earnings accrued from what we were exporting,” he opens. “Tanzania wasn’t the only country hit by the crisis, I had visited Jamaica and Tunisia at that time, and both were going through the same hardships.” The 1973 oil crisis or first oil crisis began in October when OPEC countries, led by King Faisal of Saudi Arabia, proclaimed an oil embargo. The embargo was targeted at nations that had supported Israel during the Yom Kippur War.

The initial nations targeted were Canada, Japan, the Netherlands, the United Kingdom and the United States, though the embargo also later extended to Portugal, Rhodesia and South Africa. By the end of the embargo in March 1974, the price of oil had risen nearly 300 per cent from 3 US dollars per barrel ($19/m3) to nearly 12 US dollars per barrel ($75/m3) globally; US prices were significantly higher.

The embargo caused an oil crisis, or “shock”, with many short- and long-term effects on global politics and the global economy. It was later called the “first oil shock”, followed by the 1979 oil crisis, termed the “second oil shock”.

The Tanzania-Uganda war, famous as the Kagera war was also partly to blame for the country’s economic crisis, according to the former MP and long-serminister for finance.

The war is said to have severely harmed Tanzania’s fragile economy and inflicted long-lasting damage to Kagera Region. “We had to borrow armoury from outside the country to keep Idi Amin at bay,” he explains.

Kenya’s decision to withdraw from the former East African Community (EAC) in 1977 and eventually leading to its collapse also negatively impacted the county’s economy, according to Mzee Msuya. Kenya announced its withdrawal and is said to have taken over all EAC services operating in Kenya.

“The series of events really caught us off guard as we were in Arusha, planning the merger of Tanganyika African National Union (TANU) and Afro-Shirazi Party (ASP),” Mzee Msuya narrates. While everything was managed from community level, Tanzania had to retain two of its aircraft after the East African Airways Corporation collapsed.

“This really pulled us back as we had to also start training our pilots to fly the aircraft,” he recalls.

The worst was far from over as the East African Railways came to an end, forcing Tanzania to set up its own railway corporation and an autonomous harbour services. In the economic field, the smooth running of the EAC was marred by problems arising from dissimilarities among the partners in the level of development, from trade imbalances, and from an inability to agree on a fair distribution of the costs and benefits.

It also proved difficult to harmonise economic policies in general. By and large, the East African Community collapsed due to Kenya requesting more seats in the decisionmaking organs, disagreements between member countries and the different economic systems between countries, primarily between Tanzania and Kenya.

Mzee Msuya insists that Ujamaa had nothing to do with the collapse of the economy and whatever happened was beyond Tanzania’s control. Such a setback notwithstanding, the former minister of industries and trade has a piece of advice to leaders of today.

“It is very important for our leaders to delve on researching on how best to run our economies amidst the face of adversities.” He is however, of the opinion that some issues may require external interventions at the expense of those found within.

The former Vice-President is concerned on seeing export earnings from agriculture produce stagnating. He is however quick to point out the reforms which he says have continued to reap fortunes. Such reforms, initiated by former President John Magufuli have seen Tanzania enter into agreements with other countries, according to Mzee Msuya.

“Tanzania is endowed with an array of rare minerals, just the other day we struck a deal with Burundi on Nickel exploration.” The major component of the East African Nickel Belt (EANB) is located in Burundi and western Tanzania. These deposits have been explored and delineated by mining companies, but they remain undeveloped due to their distance to the Indian Ocean coast and a lack of transport and energy infrastructure.

Kabanga is currently the only one of these EANB intrusions with potentially economic nickel sulfides.

Located in far northwestern Tanzania, approximately 120 km south-west of Lake Victoria and within a few kilometres of the Burundi border, the Kabanga deposit is acknowledged to be one of the largest and richest undeveloped nickel sulfide deposits known at present, of unmatched scale and grade.

Commercial exploration has been carried out almost continuously since 1991 by various foreign mining and exploration companies.

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