| dc.description.abstract | The objective of this paper was to explore and estimate the
effects of the Economic Recovery Programme (ERP) on the
Manufacturing sector in relation to exports, productivity changes
and-export diversification. The study was motivated by a lack of
systematic analysis of the impact of trade and macroeconomic
Policies on the manufacturing sector since the introduction of
the ERP. This study is important both in terms of validation
of theoretical models often used in such studies, and in terms
of guiding the choice of a policy mix consistent with economic
institutions and realities in Tanzania.
Econometric and comparative analysis technique, were used
to analyze the impact of ERP. Two equations in which real exports
and real exchange rate enter as dependent variables were
developed. The real exchange rate was introduced as a variable
in the export supply equation, so as to capture the effects of
both trade and macroeconomic policies as well as other policies
designed to promote exports. The equations were estimated using
Ordinary Least Squares, using time series data for the period
1966 1992. The relative impact on exports performance was
estimated utilizing the estimates of supply responsiveness to the
real exchange rate.
The signs and statistical significance of the estimated
coefficients of the econometric analysis, strongly support the
model empirically. Nevertheless, the comparative analysis results
showed that in the short run the ERP policies boosted export
performance whereas in the long-run supportive policies are
required for sustainable export growth. Hence the study confirms
The conclusions that for a sustainable export growth and steady
improvement of the manufacturing sector structural reform
policies are required in addition to trade and macroeconomic
.policies.
The comparative analysis exercise, also showed that the
macroeconomic and trade policies adopted by the ERP were subt
optimal and that they were inconsistent with the development of
Tanzania's manufacturing sector. | en |
