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Is Broad Industrialisation Imperative for Development? Case Studies on Uganda and Tanzania

Listed author(s):
  • Eva Näfe
  • Barbara von Toll
Registered author(s):

    On the basis of two case studies viz. Uganda and Tanzania, this paper examines possible paths to development. The traditional one, here called ‘broad’ industrialisation, is contrasted with agricultural-based industrialisation and service sector development as possible alternative routes for countries to improve their situation. It is argued that traditional industrialisation is not an exclusive path towards development; rather there are other options such as industrialisation based on agriculture or service sector development. For Uganda the importance of all the three sectors has been recognised. However, it is suggested that a focus on agricultural and service sector development could be more promising for the near future as there are fewer obstacles that need to be overcome. Furthermore, prioritisation of subsectors could even lead to more effective results. Within the agricultural sector it is of critical importance to develop the value-adding activities in order to increase the quality of life eventually. In the case of Tanzania, it is not so clear whether broad industrialisation or services are the key. But clearly a diversification of the economy needs to take place. Compared to Uganda, Tanzania has a clear advantage of being situated at the sea shore. Very little focus has been put on policies supporting the service sector. But, growth rates of traditional agricultural exports in Tanzania are low. Thus, there is the need to diversify into service sector exports and non-traditional value-adding activities in order to pursue a path of development.

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    File Function: First version, 2011
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    Paper provided by Hochschule fuer Technik und Wirtschaft, Berlin in its series Competence Centre on Money, Trade, Finance and Development with number 1105.

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    Length: 91 pages
    Date of creation: Aug 2011
    Publication status: Published in Berlin Working Papers on Money, Finance, Trade and Development, August 2011
    Handle: RePEc:mtf:wpaper:1105
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    1. Sheehan, Peter, 2008. "Beyond Industrialization: New Approaches to Development Strategy Based on the Service Sector," WIDER Working Paper Series 060, World Institute for Development Economic Research (UNU-WIDER).
    2. Petro S Magai & Alejandro Márquez-Velázquez, 2011. "Tanzania’s Mining Sector and Its Implications for the Country’s Development," Competence Centre on Money, Trade, Finance and Development 1104, Hochschule fuer Technik und Wirtschaft, Berlin.
    3. Kaplinsky, Raphael & Morris, Mike, 2008. "Do the Asian Drivers Undermine Export-oriented Industrialization in SSA," World Development, Elsevier, vol. 36(2), pages 254-273, February.
    4. Singh, Nirvikar, 2006. "Services-Led Industrialization in India: Assessment and Lessons," Santa Cruz Department of Economics, Working Paper Series qt8jn2b8z6, Department of Economics, UC Santa Cruz.
    5. Ajit Singh & Sukti Dasgupta, 2005. "Will services be the new engine of economic growth in India?," Working Papers wp310, Centre for Business Research, University of Cambridge.
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