Competitividad de las PYMEs y el comercio internacional en la era de las cadenas globales de valor (GVCs) en Tanzania: Análisis y desafíos

[ENG] International trade continues to play a crucial role in economic transformation in African countries. The rise of Global Value Chains (GVCs) presents opportunities through which international trade can be effectively conducted. GVCs facilitate organization of trade, international production and investment by locating different stages of production process across varied countries. This presents opportunities to integrate Small and Medium Enterprises (SMEs) into global trading systems but also may generate challenges particularly to resource constrained SMEs. Reviewing the challenges for the participation in international trade and possible integration into GVCs by Tanzania’s SMEs, the results show that the major challenges for SMEs internationalization are international marketing related constraints and global competition (69%), supply side constraints (56%), unfriendly investment climate (50%) and financial constraints (37.5%). As such, the role of trade policies remains critical in mitigating some of these challenges through formulating friendly legal and regulatory frameworks, enhancing SMEs productivity by building their managerial and technical capacities, minimizing trade costs, and increasing trade openness. However, given the current global, regional and domestic developments in Tanzania, trade policies need review so as to respond to the changing global trade landscape but also promote policy harmony, coherence and complementarities among varying implementing institutions, deficiency of which is debilitating policy implementation at present.[SPA] El comercio internacional sigue desempeñando un papel crucial en la transformación económica de los países africanos. El auge de las cadenas globales de valor (GVCs) ofrece oportunidades para llevar a cabo el comercio internacional de forma más eficaz. Las GVCs facilitan la organización del comercio, la producción global y la inversión al situar las diferentes etapas del proceso de producción en diferentes países. Esto presenta oportunidades para integrar a las pequeñas y medianas empresas (PYMEs) en los sistemas de comercio mundial, pero también puede generar desafíos, especialmente para las PYMEs con recursos limitados. Al revisar los retos para la participación en el comercio internacional y la posible integración en las GVCs por parte de las PYMEs de Tanzania, los resultados muestran que los principales retos para la internacionalización de las PYMEs son las limitaciones relacionadas con el marketing internacional y la competencia global (69%), las limitaciones del lado de la oferta (56%), el clima de inversión poco favorable (50%) y las limitaciones financieras (37,5%). Por ello, el papel de las políticas comerciales sigue siendo fundamental para mitigar algunos de estos retos mediante la formulación de marcos legales y reglamentarios favorables, la mejora de la productividad de las PYMEs mediante el desarrollo de sus capacidades técnicas y de gestión, la minimización de los costes comerciales y el aumento de la apertura comercial. Sin embargo, dada la actual evolución mundial, regional y nacional de Tanzania, las políticas comerciales deben revisarse no sólo para responder al cambiante panorama del comercial mundial, sino que además deben promover la armonización, la coherencia y la complementariedad de las políticas entre las distintas instituciones de ejecución, dichas deficiencia están debilitando la implementación de las políticas en la actualidad

Export Diversification Dynamics in Tanzania: Non-Traditional Products Approach

This paper empirically examines the influence of export diversification on export growth, following strides towards non-traditional exports diversification in Tanzania. The causal relationship between export growth and growth rate of aggregate non-traditional products using time series data from 1980 to 2012 was examined. Growth rate of aggregate traditional products was included in the study for comparable purposes. The results indicate that growth rate of aggregate non-traditional products has a statistically significant impact on the overall export growth in the short run while that of aggregate traditional products has recorded insignificant impact. This suggests that recent export growth in Tanzania is attributed to by non-traditional product growth. How-ever, there is no long run relationship between the two variables but a bi-directional short run relationship which runs from non-traditional products to export growth and vice-versa exists. Keywords: Export Diversification, Non-Traditional Product, Traditional product, export growth, vertical export diversification, horizontal export diversification. JEL: F4

A Comparative Analysis of the Application of Seasonal ARIMA and Exponential Smoothing methods in short run Forecasting Tourist Arrivals in Tanzania

This paper compared the performance of two forecasting models (Seasonal ARIMA and Exponential smoothing) in an attempt to identify the model that fits properly in forecasting tourist arrivals in a dynamic tourism industry in Tanzania.  A two-staged approach to forecasting was carried out using monthly data for the period of 2000 to 2009. The models were assessed in similarly structured setting at the outset, and then best models identified at this level were compared in a differently structured setting. The results show that Seasonal ARIMA(4,1,4)(3,1,4)12 and Holt-Winters multiplicative smoothing method are effective in forecasting tourist arrivals in Tanzania in a similarly structured setting. However, when the two models were compared under different structures, the performance of Holt-Winters multiplicative smoothing method outstripped that of Seasonal ARIMA(4,1,4)(3,1,4)12. This suggests that Holt-Winters multiplicative smoothing method with Alpha (0.01), Delta (0.11) and Gamma (0.11) is more effective in forecasting tourist arrivals in Tanzania in the short run and it can be used to aid planning processes in the tourism industry. Moreover, the seasonality pattern that characterizes tourist arrivals in Tanzania highlights the need to promote more of local tourism so as to lessen the negative impacts associated with it. Keywords: Tourist Arrivals, Forecasting, Model, Seasonal ARIMA, Exponential Smoothing, Holt-Winters additive, Holt Winters Multiplicativ

Financial Development and Private Sector Investment in the post-financial liberalization era in Tanzania

This paper examines the relationship between financial development and private sector investment in the post-financial sector liberalization episode in Tanzania. The proxies for financial development were the financial market depth index and financial institutions depth index. Applying Autoregressive Distributed Lag (ARDL) technique, the results show the nexus between financial development and private sector investment in Tanzania. We find that the financial market depth index has a positive and significant impact on private sector investment in the long run but not in the short run. This is linked to the underdevelopment of capital markets in Tanzania at present. Similarly, we find that the financial institution depth index positively and significantly impacts private sector investment in both the long and short run. The degree of openness of the economy recorded a positive and significant impact on private investment in both periods suggesting that it has played a critical role in the financial development and growth of the private sector in Tanzania. In contrast, we observe that the real exchange rate has recorded a negative and significant impact on private investment in the long and short run. This suggests that appreciation of the real exchange rate had a negative impact on private investment. We recommend increasing financial openness and reinforcing the financial regulatory reforms to widen and deepen the financial system that can effectively support the mobilization of short, medium, and long-term finance for private sector investment

Utilización de servicios no financieros de apoyo a las empresas para contribuir al desarrollo de las Pequeñas y Medianas Empresas (PYMEs) en Tanzania

[ENG] A variety of factors inhibit the development of MSMEs in African countries, which in turn affects entrepreneurship, job creation and economic transformation. Using cross-sectional data from 250 MSMEs in the Dar es Salaam region, we find in most of the examined variables the positive relationship between the use of non-financial business support services (BDS) and the development of MSMEs in the Dar es Salaam region. However, contrary to expectations, building business linkages and mentoring programs recorded negative relationships with MSMEs development. This is related to restricted capacities stemming from the size of MSMEs compared to large companies and deficiencies in the content of mentoring programs. In addition, the discrepancy between BDS demand and supply as well as the low adoption rate of BDS are associated with the inadequate adaptation of BDS to the needs of MSMEs, high service costs and a lack of qualified service providers. Thus, we argue that the provision of BDS to MSMEs should be demand-driven and that institutions should build on the pre-eminent characteristics of MSMEs when designing business support programs. On the other hand, Government efforts to nurture the development of MSMEs through policies and programs should extend to promoting business linkages between MSMEs and large enterprises.[SPA] Diversos factores inhiben el desarrollo de las MIPYMES en los países africanos, lo que a su vez afecta al emprendedurismo, la creación de empleo y la transformación económica. Utilizando datos transversales de 250 PYMEs de la región de Dar es Salaam, encontramos que en la mayoría de las variables examinadas existe una relación positiva entre el empleo de Servicios de Desarrollo Empresarial (SDE) y el desarrollo de las PYMEs en la región de Dar es Salaam. Sin embargo, en contra de lo esperado, la creación de vínculos empresariales y los programas de tutoría registraron relaciones negativas con el desarrollo de las PYMEs. Esto está relacionado con las restricciones de capacidad derivadas del tamaño de las PYMEs en comparación con las grandes empresas, además de las deficiencias en el contenido de los programas de tutoría. También, el desajuste entre la demanda y la oferta de SDE, así como la baja tasa de adopción de los SDE, se explican por: los SDE prestados no se ajustan a las necesidades de las PYMEs, a los elevados costes de los servicios y a la escasez de proveedores de servicios cualificados. Por lo tanto, sostenemos que la prestación de SDE a las PYMEs debe estar orientada a la demanda y que las instituciones deben basarse en las características preeminentes de las PYMEs al diseñar los programas de apoyo empresarial.Por otra parte, los esfuerzos del gobierno para fomentar el desarrollo de las PYMEs a través de políticas y programas deberían extenderse a la promoción de los vínculos empresariales entre las PYMEs y las grandes empresas

Trade Liberalisation in SADC and the Economic Benefits of belonging to an RTA: The case of Tanzania

This paper examines the dynamics of trade liberalisation in the Southern Development Community (SADC), region and the economic benefits that Tanzania derives from SADC membership. The paper uses qualitative analysis and trade indices. The findings show that SADC is far behind its agreed schedule of transforming the region into a customs union and SADC intra-regional trade is very low, only South Africa and Mozambique seem to carry the potential to increase intraregional trade and benefit from SADC in the short run. On the other hand, Tanzania's economic benefits from SADC membership have remained trivial, though her exports and market share have been steadily increasing since the mid 1990s. However, Tanzania does not suffer adversely from the dual membership of EAC and SADC regions, despite its membership in the two overlapping RTAs making its trade regime complex because tariff reductions under EAC customs union are not compatible with SADC's hence resulting in problems in implementing the SADC Trade Protocol. However, the country may not need to withdraw  its membership from either EAC or SADC due to signs of good prospect in the long run under the proposed harmonisation of the EAC and SADC trade regime through the Tripartiite Free Trade Area arrangement (COMESA-EAC-SADC)

Managerial Skills for Micro, Small and Medium-sized Enterprises (MSMEs)

Effective managerial skills can play a key role in the internal governance of micro and small businesses in Africa, enabling them to survive, compete and thrive in a dynamic business environment. However, due to the low absorption capacity, many micro and small entrepreneurs and managers lack the necessary managerial skills. We collected data from MSMEs owners and managers in Tanzania to examine the managerial skills required and their effect on business performance based on thematic content analysis and regression analysis. The results show that the managerial skills of MSMEs owners and managers have a significantly positive effect on MSMEs performance, in particular, financial management, marketing, human relations, and entrepreneurial skills were crucial skills in running small businesses successfully. However, financial management, marketing and entrepreneurial skills were the main skills gaps for many MSMEs owners and managers, suggesting that education, mentoring, and training in these areas for MSMEs owners and managers need to be strengthened. This study argues that since young people form the majority of the stakeholders running small businesses, targeted policies and strategies to promote entrepreneurship among young people through entrepreneurial learning and experiences can help instil an entrepreneurial mindset, one of the crucial skills in small business management

Export Diversification and Poverty Reduction in Tanzania

The objective of the study was to explore the role of export diversification in poverty reduction strategies following recent growth of non-traditional exports and its perceived potential to contain poverty in Tanzania. Real income per capita growth was used to proxy poverty reduction. Applying Toda and Yamamoto (1995) causality test model on time series yearly data (1980-2015), the results show the existence of a uni-directional causal relationship between horizontal export diversification and income per capita growth in Tanzania. The relationship between vertical export diversification and income per capita growth was found to be insignificant. The possible explanation is country’s weak industrial base. Drawing lessons from East Asia and some other African countries, it was found that deep horizontal export diversification and vertical export diversification were significant factors in enhancing income per capita growth. However, in East Asia income per capita growth led by vertical export diversification was more impressive than that of horizontal export diversification in addressing poverty. Thus, the study argues that export diversification could contribute towards poverty reduction initiatives in Tanzania. However, to enable it generate significant impacts in form of reduced poverty an integrated package of policies and strategies need to be put in place in order to spearhead both deep horizontal and vertical export diversifications in Tanzania