8.

1 Introduction

Policy debates on various economic development theories have argued for the gradual

transformation from primary production to tertiary production as essential both in the allocation

of limited resources and in the realization of gains from trade. Relative to Africa, such debates

have often pointed out the inadequacy of industrialization on the continent. The performance of

Africa’s industrial sector in terms of growth, structural change, and absorptive capacity has

historically lagged behind that of other regions. Subsequently, Africa’s terms of trade have fared

no better relative to the rest of the world (the Prebisch-Singer hypothesis).

In Tanzania, industrialization has been characterized by shifts in roles of the state and private

sector: starting with largely private sector driven industrial development up to the mid-1960s as

reflected in the First Five-year Development Plan (1964–9), shifting to largely state driven

industrial development from 1967 to the mid-1980s as reflected in the Second and Third Five-

year Plans (1969–74 and 1976–81). After all economic Recovery Program was introduced (ERP)

and the Economic and social Action Program from 1989 up to 1992 for the aim of sustainable

development from the middle 1990s to 2020 and integrated industry development of 2011.

8.2 Historical Developments: Pre-independence Period

During that time the primary focus of manufacturing in Tanzania was on

Primary, low value, labour-intensive agricultural goods. Before the First World

War (WWI).Tanzania was under the German colon which take control with the German East

Africa Company in main land. That Company of economic performance based on export of

potential and good’s exports were twice as high as those of British East Africa which operated in
the neighboring British colony of Kenya. As a result of constraints posed by the financing of the

war and the associated production and trade interruption, the German East African company

performance suffered, as the colony could not produce for outside markets. Consequently, there

were no imports, and industries which produced goods for military purposes experienced higher

growth levels.