Introduction
This is Tanzania’s second Poverty Reduction Strategy (PRS II). It builds on the achievements and lessons from the implementation of the first PRSP (2000-2003) which was mainly linked to debt relief under enhanced High Indebted Poor Countries (HIPC) initiative. Tanzania was required, among other conditions, to channel debt relief resources into “priority social sectors” of education, health, water, agriculture and rural roads and the judiciary. Public
spending on these areas was considered to have higher impact on poverty reduction. However, HIPC resources would not be adequate to eradicate poverty. Neither would spending on a few sectors provide a sufficient momentum for growth required to reduce poverty over a short and medium term. While PRSP lasted three years, PRS II takes a longerterm perspective (5 years).
The central objective of PRS II is to achieve faster, equitable and sustainable growth. It seeks to engage all stakeholders and exploit inter-sector linkages and cross-sector collaboration in the pursuit of poverty reduction outcomes. It also stresses accountability in the use of resources and monitoring and evaluation of the effectiveness of the strategy in reducing
poverty.
In the past three years, achievements have been recorded in the delivery of social services especially in primary education, basic health care and access to clean and safe water. Years of economic reforms have resulted in impressive macroeconomic performance. GDP growth rate consistently rose in the past six years, reaching 6.2 percent in 2002. It declined to 5.6 percent in 2003 due to drought in the 2002/03 season. Inflation dropped to 4.4 percent in 2003 compared to 6 percent in 2000 or higher in previous years. In 2003 foreign reserves reached 8.9 “months of imports” compared to 6.3 “months of imports” in 2000 or lower in previous years. The nominal exchange rate is market-determined with interventions limited to smoothing fluctuations. Also considerable increases in investments in infrastructure especially roads and communication systems have been recorded.
Enormous challenges still lie ahead, however, as the Government strives to maintain the momentum for growth and continued socio-economic reforms. For poverty reduction, growth and macro-level achievements need to be adequately translated into micro-level welfare outcomes all the way to the household level. At the same time, there is a need to sustain the successes, further improve access and quality of social services and address concerns of
vulnerable groups.
PRS II adopts an outcome-oriented approach, emphasizing inter-sector linkages towards the achievement of results. Three broad outcomes for poverty reduction are identified, namely, (i) growth and reduction of income poverty, (ii) improved quality of life and social well being, and (iii) governance and accountability. These form the basis for determining strategic interventions. Increased efforts will be made to mobilise domestic resources, improve investment climate and increase competitiveness and readiness of the economy to cope with the challenges of globalisation.
Greater attention has been paid to mainstreaming crosscutting issues, namely: HIV and AIDS, gender, environment, employment, governance, children, youth, elderly, disabled and settlements into the strategy right from the beginning and not through separate chapters. Goals and interventions relating to the crosscutting issues have been included in the three clusters of broad outcomes. Implementation and monitoring plans for PRS II include specific
actions on mainstreaming and development of indicators for the crosscutting issues.
PRS II remains a crucial organizing framework for putting the focus on poverty reduction high on the country’s development agenda. It continues to be guided by the ongoing reforms and national policy frameworks, including the Tanzania’s Development Vision 2025, Tanzania Assistance Strategy (TAS), Rural Development Policy, Rural Development Strategy and the Medium Term Plan for Growth and Poverty Reduction. It is also instrumental in widening the space for country ownership and effective participation of civil society and facilitating more fruitful local and external partnerships. In addition, PRS II identifies itself also with international development obligations, including the Millennium Development Goals (MDGs), the New Economic Partnership for African Development (NEPAD), the Brussels Plan of Action (BPOA) and the World Summit on Sustainable Development (WSSD), among other international commitments to poverty reduction.
PRS II has seven chapters. Following the introduction, Chapter Two discusses the status of poverty and challenges ahead. Chapter Three spells out the framework guiding the strategy, while Chapter Four provides PRS II Strategy. Implementation arrangements are discussed in Chapter Five and monitoring and evaluation in Chapter Six. Chapter Seven presents the financing arrangements for the strategy.
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