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See Malima, op. eit. (1986) pp. 137-138. See Singh, Development and Change, op. eit. (1986) pp. 449-450. Ibid. Walter Biermann and John Campbell, 'The Chronology of Crisis in Tanzania, 1974 to 1986', (London: Institute for Afriean Alternatives, September 1987) mimeo, p. 16. Malima, op. eit. (1986) p. 132. Ibid. p. 138. Vali Jamal, 'Eeonomies of Devaluation: The Case of Tanzania', Labour and Society, vol. 11 (September 1986) no. 3. Government of Tanzania, Structural Adjustment Programme Jor Tanzania (Dar es Salaam: June 1982).

It relied, principally, upon directives to state entities and moral exhortation to peasants and workers. But directives per se were of little value in a situation of acute goods shortages and the mobilisation of workers and peasants on a purely political basis was, by 1981, almost futile in Tanzania. Exhortation had met with some success in stimulating food production in the mid-1970s but after years of austerity and falling living standards, and in a context of widespread shortages of consumer goods, equipment and supplies, not to mention transport bottlenecks, the ability of the state to mobilise people by exhortation was greatly reduced and the physical capacity of people to respond was limited.

It is envisaged that these capital inflows will complement policy and institutional reform to permit a sustained expansion of domestic supply. It remains a moot point whether or not a more accommodating approach to exchange rate adjustment would have secured them four years earlier and allowed adjustment to take place at a lower social cost in terms of reductions in real income and in the provision of public goods. It is far too early to assess the effectiveness of the 1986 package and in particular the more flexible exchange rate policy but some 28 Structural Adjustment in Africa preliminary observations can be made.

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Advanced Macroeconomics Solutions by Romer

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