THE ROLE AND INFLUENCE OF MAIN INTEREST GROUPS IN THE NATIONAL TRADE POLICY PROCESS IN TANZANIA By Robert Mabele* *Associate Research Professor, Economic Research Bureau, University of Dar es Salaam
Economists point out that the gains from trade may not be equitable for two countries engaged in a trade transaction. For the country gaining this gain may not be shared by all segments of society in that country. Similarly in the losing country the loss may affect some segments of society more adversely than others. This is clearly demonstrated in all basic texts of trade theory and policy.
Except for the government, the other stakeholders in the trade process are not very homogenous groups. There are for example agricultural producers and manufacturing firms which are not expected to have common interests all the time.
Even the category of manufacturers may have conflicting interests since one group may be producing inputs for further manufacturing by some other manufacturer and therefore their interests may differ.
The most heterogeneous group is perhaps the consumers. In the final analysis we are all consumers. Workers probably make up the most important sub-category of consumers. Furthermore employees support their employers since they get their means of livelihoods from the salaries they get from their employers. Thus apart from conflict of interests there are opportunities for coordination and cooperation among stakeholders.
The key stakeholders in the trade policy making process
It is clear that there are numerous groups that can claim to have a stake in the trade policy process. It is not possible for all of these groups to participate in common at the same time. While trade policy is mainly a government activity with the active participation of stakeholders, the government should take the lead in the mobilization and coordination of all the stakeholders in the trade sector.
The idea should be to have representatives from the following organizations that have a stake in Tanzanian’s trade. In summary the group would consist of the following organizations.
(a) GOVERNMENT (EXECUTIVE, LEGISLATIVE, JUDICIARY and PARASTATALS
(b) FARMERS AND COOPERATIVES
(c) WORKERS UNIONS
(d) INDUSTRIALISTS (eg CIT)
(e) TRADERS (e.g. TCCIA
(d) ACADEMICS RESEARCHERS AND PROFESSIONALS
(e) NGOs and CBOs
(f) POLITICAL PARTIES
(g) OTHER SPECIAL INTEREST GROUPS eg. Women entrepreneurs
It is seen from above that for such a wide and varied range of interests it is difficult to smoothly participation manage. The formation of apex or umbrella organization will help the creation of a more manageable representation.
When it comes to actual practice in Tanzania, progress has been made to ensure the participation of as many stakeholders as possible in the trade policy process. However participation by workers and cooperatives seems to be clearly weak.
2. Representation and Influence in the Policy Process
Apart from the Government Ministries, the influential stakeholders are the representatives of the industrial organizations like CIT the Chamber of Mines and TCIA. The Farmers’ Organization is also beginning to be active. The cooperatives and trade unions seem to be the least influential.
3. Means to Wield Influence
The main factors determining influence and participation appear to be homogeneity of interest and availability of resources in terms of personnel and finance to undertake or commission studies to study issues of interest and come up with recommendations which contribute to policy formulation. Sometimes these efforts do not succeed. For example some stakeholders tried their best to reverse Tanzania decision to quit COMESA. To-date Tanzania’s has not yet rejoined COMESA.
We can take any trade issue. If the Minister of Finance raises the import duty on a commodity some people will gain some will lose. The government gains through increased revenue but consumers lose because they have to pay higher prices. When the East African countries eliminate tarrifs among member countries, consumers gain because prices fall but government loses revenue. Manufactures may fail to compete in the Customs Union and close. This means that employment in some members countries may decline.
4. The Roles Played by the Various Stakeholders
The important activities the private sector participants are engaged in include participating in the national dialogue on the economy as a whole as well as on specialized issues such as those relating to trade. They support their contribution to the dialogue through undertaking studies. The dialogue is an of the strategy to strengthen public-private partnership. This strategy is carried further when
representatives of the private sector join government on negotiating delegations for regional cooperation e.g. in ECA and SADC, for negotiations with the EU as part of the ACP block and for negotiations at the global level e.g. in the WTO, at UNCTAD, other UN Economic Agencies etc-- The participation of representatives from the private sector in the negotiations help the country to increase the number of knowledgeable people in the country on trade issues.
This knowledge also flows further down the grassroots. Some of the important activities concerning public-private consultation and dialoging are undertaken jointly by the government and the private sector through the Tanzania Business Council. These include the SMART Partnership programme which is intended to run from the district to the National Level. Regions are now forming Regional Business Councils (which will forward recommendations to the National Business Council) or directly to government.
5. Challenges and Way Forward for Strengthening the Role and Influence of Main Influence Groups
There is need for the capacity of the private sector and especially the non-governmental organizations (NGOs) and civil based societies (CBOs) to be strengthened it they are to benefit from the participation in the trade policy process. This must be done by tackling the obstacles they face as participants in the process.
The most important obstacle facing them is lack of knowledge of the issues. For those who join the country’s negotiating teams they normally receive intensive training seminars and workshops which include learning some of the technical terms and techniques involved. The aim however is to raise the general awareness of as many people as possible on the issues. Good economic governance requires that people understand the main economic issues.
The other obstacle hindering the weaker groups in their participation is lack of resources. These resources may be needed in providing training facilities in terms of teachers and teaching materials.
While some of the resources can be provided through the government, donors and local organizations e.g. Universities, NGOs (both local and locally based international NGOs and UN and other international organizations the organizations can also raise their own resources. The training of trainers to train participants at the grassroots is needed if the improvement of the knowledge of the people on trade and other economic issues is to reach the general public.
In order to appreciate the need for training their members, there is need to strengthen Private Sector Institutions so as they can design better training programmes of their own or make use of training by others. Some of these training may be free but they must be sought out and well programmed.
Finally the Platform on National Dialogue on economic issues including those on trade must continue to be developed with opportunities given to all to contribute ideas being open to all participants for it to be a real dialogue and not degenerate into a monologue.
It is only then that government’s efforts to ensure that governance arrangements for growth-enhancing interventions are successful when market failures for example, cause problems. Recent good efforts in this regard include targeted agricultural subsidies and targeted guaranteed credit schemes.
GoT ( ) National Trade Policy.
Robert J. Utz (Edit) (2007) Sustaining and Sharing Economic Growth in Tanzania, World Bank, Washington DC.
SIDA (2005) Tanzania Diagnostic Trade Integration Study.
Thomas A. Engel, Peter H. Linder (2000) International Economics , McGraw-Hill.
USAID (2004) Assessment of Tanzania’s Producer Organization.