Financial Sector Reform and Its Impact on the Financing of Agricultural Marketing Cooperatives in Tanzania

Abstract

The world today is in a major transformation process from state led social economic development to heavy reliance on market. Indeed, this is more pronounced among the once socialist oriented countries. Tanzania, which once claimed to be a socialist state, is not left out of this major transformation. In an attempt to build socialism, Tanzania relied heavily on cooperatives. As a result, cooperatives were promoted and supported heavily from the early days of independence. Series of cooperative transformation measures were introduced at different times. At first, cooperatives were vigorously promoted and replicated all overt the country This was followed by a systematic infusion of the ujamaa ideology into cooperation. However, by 1976, it was found that the existing form of cooperation could not co-exist with the ujamaa village policy, and hence cooperatives were dissolved. The present cooperatives were as a result of the government’s U-turn in her policies by allowing the reintroduction of cooperatives in 1984 through the enactment of cooperatives legislation in 1982