Govt names sectors affected by global crisis

AGRICULTURE, tourism and mineral are the most hard-hit sectors in the country in the wake of the global economic meltdown, the House heard here yesterday. Finance and Economic Affairs deputy minister Omar Yusuf Mzee said the sectors have been most affected because of the decline in demand in the world market.

Mr Mzee said the sectors were directly linked with the global market, thus their stability depended on what was happening abroad and therefore there was little the government could do to salvage the situation.

He was responding to Mr Mohammed Ali Said (CUF-Mgogoni) who wanted government statement on the state of the economy following the crisis, which he observed had affected the country contrary to assurance given earlier by the Bank of Tanzania (BoT) Governor.

The deputy minister clarified that the country's economy was spared the first round effects of the meltdown because of a number of reasons including the fact that the country had less attachment with global financial markets. He however said as time went by, the crisis took another turn, known as second round effect, which the country could not avoid.

"This (second round effect) had to do with dwindling financial capacity of Western countries to buy goods and services from third world countries including Tanzania," observed Mr Mzee. He added that as a result the economic growth projections for 2009 currently stand at between five to six per cent, down from 7.4 per cent rate recorded last year.

The deputy minister however appealed for patience among legislators, noting that a task force formed to assess the economy in the wake of the global economic downturn had already submitted its findings and recommendations that would be revealed during the budget speech tomorrow.