The Relationship of the Stock Market Prices on Exchange Rate and Market Capitalisation: the Case Dar es Salaam Stock Exchange in Tanzania

This paper investigated the relationship between the Dar es Salaam Stock Exchange All Shares Index (DSEI), Exchange rate (EX) and Market capitalisation (MC) using monthly data from July 2009 to December 2013 obtained from quarterly Updates and website of Dar es Salaam Stock Exchange. The regression and correlation techniques were used to establish the relationship. The dependent variable was the Dar es Salaam Stock Exchange All Shares Index while Exchange rate and Market capitalisation, were independent variables of regression. The results show that the Exchange rate and the Dar es Salaam Stock Exchange All Shares Index have positive regression coefficient, Market capitalisation and Dar es Salaam Stock Exchange All Shares Index also have positive regression coefficient. Also these three variables were found to have positive correlation coefficients. From these results obtained, we suggested that there is strong positive linear relationship between Market capitalisation and Dar es Salaam Stock Exchange All Shares Index, and moderate positive relationship between Exchange rate and the Dar es Salaam Stock Exchange All Shares Index. Keywords: Dar es Salaam Stock Exchange, Market capitalisation, exchange rate, relationship, regressio

Financial Inclusion and Challenges in Tanzania

Financial inclusion is said to be very important for economic growth and policymakers had high expectation about the prospect of their financial sector which encourage financial inclusion. The year 1990 marked changing point in Tanzania financial sector following financial liberalization. Since then the level of financial sector has steadily increased supported by an increase in the number of banks and financial services. However Tanzanian banks have not been able to include various segments of the population into the banking services.  This paper highlights the overall status of financial inclusion in Tanzania through looking at existing statics on people access to various financial services and institutions. The overall people’s perception and understanding over the accessing of these financial services were also observed through simple questionnaire. The paper found that despite the increase in financial services the level of access to these services especially in the formal banking sector remain very low. According to the FinScope survey Tanzania 2013, the proportion of adult population in Tanzania with access to formal banking services was approximately 14%. The paper also found that issues like cost, lack of robust technology, lack of awareness and regulatory requirements are among the challenges hindering financial inclusion. Keywords: Financial Inclusion, Financial sector, Financial Liberalization and challenges