Abstract:
Studies which have been carried out on industrial development in underdeveloped
countries have shown that usually the aims and objectives of industrialization through
import substitution do not conform to the outcome of the strategy. Normally, import
substitution is designed to solve balance of payment problems including other problems
of economic underdevelopment. Yet, it has been claimed that the strategy ends up in
bringing more balance of payments and economic stagnation. This paper therefore tries
to investigate the problems of import substitution industrialization in Tanzania based on
quantitative data from six selected consumer and intermediate goods industries. The
study is guided under the hypothesis that import substitution industrialization has not
successfully solved the balance of payments problems.