Macroeconomic Policy Development in Tanzania

Image: Getty, Marco Longari/AFP
Image: Getty, Marco Longari/AFP

During the period between 1961, when Tanzania attained independence, and the mid-1980s, the country followed socialist macroeconomic policies.

Summary:

  • Tanzania’s economy is facing an unprecedented macroeconomic crisis as attempts are made to contain the impact of the COVID-19 pandemic.
  • The country’s ‘business as usual’ approach (which excluded a lockdown of economic activity apart from urging the population to take precautionary measures) and expansionary macroeconomic policy measures appear to be working with the country averting a recession in 2020.
  • Sectors such as imports, exports and tourism have been seriously affected, and cannot be easily reached through a domestic fiscal and monetary stimulus.
  • Recovery in these sectors will depend on how quickly trade and tourism partners recover.
  • The Tanzanian government’s fiscal and monetary measures have been largely successful in cushioning the severity of the pandemic on the population and businesses while preventing socio-economic deterioration.
  • Tanzania’s economy is on a good path to ‘build back better’ in 2021 and return to a pre-COVID growth path.
4 Oct 2021
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Research by
Series
COVID-19 MACROECONOMIC POLICY RESPONSES IN AFRICA 07
Region
Middle East & North Africa
Country
Tanzania
SAIIA Programme
Economic Diplomacy
Tags
COVID-19, Monetary and Fiscal Responses, macroeconomic
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