Economy - Tanzania is perhaps the only country in the world that 'discourages' exports. Government's recent decisions to ban exports of maize and sugar not only contradict its own policies but take the country back in the dark days of protectionism. You cannot promote Kilimo Kwanza initiative on one hand and prohibit maize farmers from fetching better prices in foreign markets on other hand. There is no way farmers will be motivated to produce more next agricultural season if they can't sell their surplus this year. If they can't produce more they will forever remain peasants, something which is not the main target of Kilimo Kwanza. With this attitude, surely, there is no way Tanzania will get large-scale investors in agriculture sector because they will be discouraged. You can't have an investor who has spent millions of money to produce maize then bar him/her to sell where he wants. Trade is the only major solution for agricultural revolution in Tanzania because the more farmers will export or even sell within the country, the more they will expand their productions the next season. Besides, in modern days farmers only produce when they are certain of the markets for their produce. If they are not sure of the markets then they will not produce given the fact that agriculture nowadays need al lot of financial investments.

It was reported that some farmers in Regions bordering other countries such as Rukwa, Mbeya have tons of maize piled up and there is no one to buy within the country. Likewise there are other Regions with food shortages. This situation is a function of fragmented local commodity market coupled with severe supply side constraints.

The constraints include poor infrastructure such as roads and electricity, which both raise costs of production. Why not allow a farmer in Rukwa sell his maize in Zambia and keep money in a bank than holding huge stock of maize he cannot handle due to higher storage costs?

We must also bear in mind that maize is now a semi-cash-crop, which means keeping it just for food is a loss. Tanzanians are now getting used of eating other food other than 'Ugali', which means even without maize they can survive.

Using Strategic Grain Reserve (SGR) to do maize business is perhaps another bad move by the government because SGR has limited financial and human resources.I doubted whether SGR has enough marketing and trade experts to assume the role of Ministry of Industry, Trade and Marketing, not to mention the ministry itself which has failed to that.

The government should not do business but just facilitate private sector to do it. Giving SGR mandate to regulate grain supply in the markets will only distort markets.I understand the government's concern of food security. But you should remember that since it started the bans some years back, the country has continued to face food shortages.

Since food producers are individuals, it is important to make them responsible for their actions. Farmers of today are very much aware of the consequences of exporting or selling all their produce. Besides, in trade there is nothing wrong with exporting the same product in one country and buying it from another country when you need it.

It is ok for a farmer in Rukwa to sell maize in Zambia and people in Kigoma to buy maize in Rwanda because sometimes it is expensive to move goods from Rukwa to Kigoma than from Rwanda.

Likewise in the Sugar case, there is no way local sugar industries will expand if they are prohibited from exporting foreign markets, especially even to our neighbours.But also why protect few workers and farmers in sugar value chain at expense of 40 million Tanzanians who pay exorbitantly price of sugar.

The bad thing about protectionism is that it doesn't help local sugar producers improve. It makes them inefficient, hence increasing costs and price of the commodity. The best way could be to allow competition between the local producers and imported sugar.

Here the duty of the government should be to regulate competition between the two so that the local producers are not heavily overshadowed. With competition, local producers will adjust themselves to work in a more efficient way. Tanzanians now have become smugglers instead of legitimate traders because of too much protection.

Even crossing goods to Kenya is nowadays called smuggling while under East African Community Common Market Protocol traders are entitled to move freely without any charges. The more the country will 'discourage' exports the more it will lose foreign currencies.

Already we are losing a lot from factory closures due to acute shortage of electricity.

Without foreign currencies our shilling will continue to depreciate and commodity prices including that of sugar and maize will continue to soar.

Faraja Mgwabati

Tanzania Daily News/27/10/2011