zanzibar human development report 2009 towards pro poor growth

Transcription

ZANZIBAR HUMAN DEVELOPMENT REPORT
2009
TOWARDS PRO POOR GROWTH
(Background picture: the famous decorated door of Zanzibar. The top cover
can also be adorned by the colours of Zanzibar flag with blue coming out
more prominently)
TABLE OF CONTENTS
TABLE OF CONTENTS.............................................................................................................................. 2
LIST OF ACRONYMS ............................................................................................................................... 5
LIST OF TABLES ........................................................................................................................................ 7
LIST OF FIGURES...................................................................................................................................... 9
ACKNOWLEDGEMENT .........................................................................................................................10
FOREWORD...........................................................................................................................................12
EXECTUTIVE SUMMARY........................................................................................................................15
CHAPTER 1: INTRODUCTION................................................................................................................21
1.1
TOWARDS PRO-POOR GROWTH ................................................................................................... 21
1.2
DATA .......................................................................................................................................... 21
1.3
SUMMARY OF HUMAN DEVELOPMENT SITUATION IN ZANZIBAR ......................................................... 22
ORGANIZATION OF THE REPORT .................................................................................................................. 24
CHAPTER 2: STATUS OF HUMAN DEVELOPMENT IN ZANZIBAR .........................................................26
2.1
2.2
2.3
2.4
2.5
2.6
2.7
2.8
GLOBAL CONTEXT........................................................................................................................ 26
DIMENSIONS OF HUMAN DEVELOPMENT ........................................................................................ 26
GDP PER CAPITA AND HOUSEHOLD EXPENDITURE; TRENDS AND SPATIAL DIMENSIONS .................... 29
HEALTH AND LIFE EXPECTANCY ..................................................................................................... 31
KNOWLEDGE AND EDUCATION ..................................................................................................... 37
GENDER PARITY ........................................................................................................................... 45
WATER ........................................................................................................................................ 48
CONCLUSION AND SOME POLICY ISSUES ....................................................................................... 48
CHAPTER 3: NATIONAL INCOME GROWTH AND DISTRIBUTION .......................................................50
3.1
OVERVIEW ................................................................................................................................... 50
3.2
GROWTH PATTERN AT MACRO-LEVEL ............................................................................................ 50
3.3
SECTORAL PATTERNS OF GROWTH ................................................................................................. 53
3.4
PATTERNS OF GROWTH AND PRO-POOR EMPLOYMENT .................................................................. 55
3.5
PREDICTING POVERTY PATH FROM THE GROWTH PATTERN .............................................................. 57
3.5.1 Poverty Trends under the Assumption of Distributional Neutral Growth ................. 57
3.5.2 Poverty Trends under Different Assumptions on Inequality ....................................... 58
3.6
CONCLUSION AND POLICY MESSAGES.......................................................................................... 59
CHAPTER 4: REACHING THE POOR: POVERTY AND HOUSEHOLD INCOME DISTRIBUTION .............60
4.1
OVERVIEW ................................................................................................................................... 60
4.2
POVERTY MEASUREMENT: AXIOMATICALLY PREFERRED INDICES AND THE ESTIMATES ......................... 61
4.2.1 Poverty Severity.................................................................................................................. 62
4.2.2 Sensitivity Analysis to Poverty Measures ........................................................................ 65
4.3
INEQUALITY AND HOUSEHOLD WELFARE IN ZANZIBAR ...................................................................... 67
4.3.1 Gini Coefficient and Generalized Entropy Measure. ................................................. 68
4.3.2 Generalized Lorenz Curves.............................................................................................. 69
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Zanzibar Human Development Report 2009
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4.4
REACHING THE POOR: POLICY RESPONSE AND PROPOSALS........................................................... 71
4.4.1 Explaining the Disparity .................................................................................................... 72
4.4.2 Policy Response and Proposals ...................................................................................... 74
4.5
CONCLUSION .............................................................................................................................. 76
CHAPTER 5: TOURISM PERFORMANCE AND ITS LINKS TO HUMAN DEVELOPMENT.........................77
5.1
5.2
5.3
5.4
5.5
OVERVIEW ................................................................................................................................... 77
THE LEVEL AND THE POTENTIAL OF TOURISM IN ZANZIBAR ................................................................. 79
TOURISM AND ECONOMIC GROWTH ............................................................................................. 83
DISTRIBUTION OF BENEFITS FROM TOURISM ...................................................................................... 87
SOME POLICY ISSUES .................................................................................................................... 91
CHAPTER 6:
MICRO, SMALL AND MEDIUM ENTERPRISES (MSMES) IN ZANZIBAR: IS IT AN EXIT
VALVE OUT OF POVERTY? ................................................................................................................... 94
6.1
INTRODUCTION ............................................................................................................................. 94
6.2
REVIEW OF THE STATUS AND ROLE OF MSME S IN ZANZIBAR ............................................................. 94
6.2.1 Status of MSMEs.................................................................................................................. 94
6.2.2 Contribution of MSMEs...................................................................................................... 97
6.2.3 Profile of Workers, Markets and Efficiency of the Enterprises .................................... 98
6.2.4.
Constraints on Enterprise Operations and Growth............................................... 100
6.2.5.
Country Comparative Analysis ................................................................................ 101
6.2.6 Major Conclusions and Recommendations .............................................................. 105
CHAPTER 7: GOVERNANCE, PARTICIPATION AND INCLUSIVENESS: INGREDIENTS OF PRO-POOR
GROWTH .............................................................................................................................................108
7.1
THE KEY CONCEPTS AND STUDY APPROACH ................................................................................ 108
7.2
THE STUDY FINDINGS ................................................................................................................... 109
7.2.1 Governance and Mobility in Zanzibar: Overall Assessment.................................... 109
7.2.2 Governance and Mobility in Zanzibar: The Case of Mwanyanya and Chachani
Shehias ............................................................................................................................................ 120
7.2.3 Major Conclusions and Recommendations................................................................. 124
CHAPTER 8:
KEY MESSAGES.........................................................................................................127
8.1
HUMAN DEVELOPMENT SITUATION ............................................................................................... 127
8.2
NATIONAL INCOME GROWTH AND DISTRIBUTION ......................................................................... 128
8.3
Reaching the Poor: Poverty and Household Income Distribution ......................... 128
8.4 Tourism and Human Development ..................................................................................... 129
8.5 MSME and the Prospect of Poverty Alleviation................................................................. 130
8.6 Governance, Participation and Inclusiveness ................................................................ 131
REFERENCES........................................................................................................................................133
APPENDICES .......................................................................................................................................138
APPENDIX B.......................................................................................................................................... 141
APPENDIX D ......................................................................................................................................... 145
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LIST OF ACRONYMS
AIDS
ANGOZA
ARV
CADS
CCM
CIS
CUF
DFID
DHMT
DHS
DPT
EPI
EPZs
FDIs
FGIS
GDP
HMIS
HSPS
HBS
HDI
HDR
HIV
ICLS
ICT
ILFS
IMF
LGRP
MACEMP
MDGs
MKUZA
MoFEA
MSME
NBS
NSAs
NSGRP
OCGS
OPD
Acquired Immunodeficiency Syndrome
Association of Non-Governmental Organization in Zanzibar
Anti- Retro Viral
Community Agricultural Development Sub-project
Chama cha Mapinduzi
Community Investment Sub-project
Civic United Front
United Kingdom’s Department for International Development
District Health Management Teams
Demographic and Health Survey
Diptheria, Pertussis and Tetanus
Expanded Programme on Immunization
Economic Partnership Zones
Foreign Direct Investments
Farmers Group Investment Sub-project
Gross Domestic Product
Health Management Information System
Health Sector Programme Support
Household Budget Survey
Human Development Index
Human Development Report
Human Immunodeficiency Virus
International Conference of Labour Statistics
Information Communication Technology
Integrated Labour Force Survey
International Monetary Fund
Local Government Reform Program
Marine and Coastal Environment Management Project
Millennium Development Goals
Mkakati wa Kukuza Uchumi na Kuondoa Umasikini Zanzibar
(Zanzibar Strategy for Growth and the Reduction of Poverty, ZSGRP)
Ministry of Finance and Economic Affair
Micro, Small and Medium Enterprises
National Bureau of Statistics
Nan-state Actors
National Strategy for Growth and Reduction of Poverty
Office of the Chief Government Statistician
Out Patient Department
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ODA
OPV
PADEP
PHCC
PHCUs
PHDR
PRS
RCH
RGoZ
2002 TPHC
TASAF
TB
TRCHS
UN
UNDP
VCT
WHO
ZHSRSP II
ZHMT
ZIFA
ZIPA
ZMCP
ZSGRP
Official Development Assistance
Oral Polio Vaccine
Participatory Agricultural Development and Empowerment Project
Primary Health Care Centres
Primary Health Care Units
Poverty and Human Development Report
Poverty Reduction Strategy
Reproductive and Child Health
Revolutionary Government of Zanzibar
2002 Tanzania Population and Housing Census
Tanzania Social Action Fund
Tubercle Bacilli
Tanzania Reproductive and Child Health Survey (1999)
United Nations
United Nation Development Programme
Voluntary Counselling and Treatment
World Health Organisation
Zanzibar Health Sector Reform Strategic Plan II
Zonal Health Management Teams
Zanzibar Institute of Financial Administration
Zanzibar Investment Promotion Agency.
Zanzibar Malaria Control Programme
Zanzibar Strategy for Growth and Reduction of Poverty
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LIST OF TABLES
Table 1.1: Life Expectancy by Region (With HIV Incidence Taken into Account) ................................... 22
Table 1.2: Gross Enrolment Ratio by Region (Basic) ............................................................................... 23
Table 1.3: Adult Literacy Rate by Region in 2004/2005........................................................................... 23
Table 1.4: Mean Household Expenditure over 28 Days per Region in 2004/2005.................................. 23
Table 1.5: Human Development Index by Administrative Region for 2005 ............................................. 24
Table 2.1: Per Capita Household Expenditure for 28 Days ...................................................................... 31
Table 2.2: Life Expectancy at Birth (with HIV Assumption)....................................................................... 31
Table 2.3: Nutritional Status in Zanzibar, Unguja, Pemba and the Rest of Tanzania ............................. 32
Table 2.4: Infant, Child and Under-5 Mortality: Zanzibar vs. Tanzania Mainland .................................... 33
Table 2 5: Percentage of Individuals Reporting Illness or Injury in the Past Four Weeks by District
(2004/2005) ................................................................................................................................................. 33
Table 2.6: The MDG Progress on Health Related Targets....................................................................... 34
Table 2.7: Malaria incidence per 100 population, 2008 ............................................................................ 35
Table 2.8: Tuberculosis cases and treatment outcomes 2004 - 2008...................................................... 36
Table 2.9: Tuberculosis cases and treatment outcomes .......................................................................... 36
Table 2.10: HIV cases found in Ante natal care services, 2008 ............................................................... 37
Table 2.11: Distribution of Health Facilities by District and Type, 2007 ................................................... 37
Table 2.12: Gross Enrolment Ratio (Basic Education, STD 1 to Form 2) ................................................ 38
Table 2.13: Transition rate Form 2 to Form 3 by district (Form Two Examination Pass Rates In
Percentage)................................................................................................................................................. 39
Table 2.14: Class Pupil Ratios by District.................................................................................................. 42
Table 2.15: Enrolment into Universities in Zanzibar.................................................................................. 42
Table 2.16: Level of Education and the Percentage of Trained Teachers by Districts............................ 43
Table 2.17: Adult Literacy and by District ................................................................................................. 44
Table 2.18: Employment and Earnings by Sector and Sector, 2007........................................................ 45
Table 2.19: Representation of Women in Decision Making Bodies, 2007 ............................................... 46
Table 2.20: The Number of Shehas and Councillors by Gender and Districts ........................................ 47
Table 2 21: Basic Education: Gender Parity Index (Boys/Girls) STD I to FORM II ................................. 47
Table 2.22: Proportion of People with Access to safe and Clean Water by Region, 2003 – 2008 ......... 48
Table 3.1: Decomposition of GDP Growth into Sectoral Growth in Zanzibar (in percent)
Table 3.2: Employment elasticity of growth in Zanzibar in between 2007 and 2008
54
56
Table 4.1: Ranking of Districts in Terms of Head Count Poverty Measure.............................................. 62
Table 4.2: Ranking of Districts in Terms of Poverty Severity Index.......................................................... 64
Table 4.3 Confidence Interval of Difference in Poverty Severity between Districts................................. 64
Table 4.4: Inequality Measures .................................................................................................................. 68
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Table 4.5: Inequality, Pemba vs. Unguja ................................................................................................... 69
Table 4.6: Distribution of Industrial Establishments By Size and Districts in 2001.................................. 72
Table 4.7: Distribution of Hotels/Guest Houses by grading and district ................................................... 73
Table 4.8: Number of Households Connected to Electricity .................................................................... 73
Table 4.9: Budgetary Allocation by Districts .............................................................................................. 75
Table 4.10: Distribution of Per Capital Budgetary Allocation by Districts, 2008/9 ................................... 75
Table 5.1: Contribution of Tourism Sector to the Economy (2001/02-2005/06) ...................................... 80
Table 5.2: Number of Tourist Arrivals (2006-2008) ................................................................................... 81
Table 5.3: Comparison of Revenue and Labour Force in Tourism Sector............................................... 81
Table 5.4: Accommodation Facilities and Average Stay........................................................................... 82
Table 5.5: Accommodation in Zanzibar by their classes/grades .............................................................. 82
Table 5.6: Contribution to GDP by the Tourism Sector July-March 2007/2008 USD.............................. 84
Table 5.7: Interpolated Estimates of Tourism Contribution to the GDP ................................................... 86
Table 5.8: Share of Fresh Foods Locally Sourced by Hotels and Restaurants ....................................... 87
Table 5.9: Distribution by Nationality of Projects Approved by ZIPA 2008 .............................................. 89
Table 5.10: Percentage of Population (15-64 Years) who’s Main Activity is Tourism ............................. 90
Table 6.1: Number of Business by Region ................................................................................................ 95
Table 6 2: Number of Businesses by District............................................................................................. 96
Table 6.3: Distribution of Businesses by Region and Size of Workers .................................................... 96
Table 6.4: Number of Businesses by Ownership and percent Change .................................................. 97
Table 6.5: The Profile of Workers............................................................................................................... 98
Table 7.1: Cumulative Fund Disbursed to Community Agricultural Development Sub-projects (CADS)
as at 31st March, 2008 ............................................................................................................................. 115
Table 7.4: Number of Private Schools by Category: 2003 – 2008 ......................................................... 119
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LIST OF FIGURES
Figure 2.1: Trend in GDP in Zanzibar, 1991-2008 .................................................................................... 30
Figure 2.2: Trend in GDP per Capita in USD............................................................................................. 30
Figure 2.3: Observed GER against Predicted GER .................................................................................. 40
Figure 2.4: Trend in the Enrolment Rate by Class/Grade and by District ................................................ 40
Figure 3.1: Trend in Zanzibar's GDP between 2002 and 2008 ................................................................ 51
Figure 3.2: Simulated Poverty Levels in Zanzibar since 2004.................................................................. 58
Figure 3.3: Simulated poverty trends in Zanzibar since 2004 under different assumptions on the
inequality ..................................................................................................................................................... 59
Figure 4.1: Correlation of the HDI and per Capita Income........................................................................ 61
Figure 4.2: First Order Stochastic Dominance Graphs ............................................................................. 67
Figure 4.3: Stochastic Graphs for Pemba Island against Unguja Island.................................................. 67
Figure 4.4: Generalized Lorenz, Unguja and Pemba................................................................................ 70
Figure 4.5: Generalized Lorenz, Districts in Pemba.................................................................................. 70
Figure 4.6: Generalized Lorenz, Districts in Unguja.................................................................................. 71
Figure 5.1: Tourist Arrivals in Zanzibar; 1980-2008 .................................................................................. 79
Figure 5.2: Trends of the Share of Hotels and Restaurants in the GDP .................................................. 85
Figure 6.1: The Establishments’ Sales to Various Markets ( percent) ..................................................... 99
Figure 6.2: Major Obstacles to Enterprise Operations and Growth........................................................ 100
Figure 6.3: Very Severe Obstacles to Enterprise Operations and Growth............................................. 101
Figure 6.4: Tax Rate and Tax Administration: Country Comparison...................................................... 102
Figure 6.5: Telecommunication, Power and Transport ........................................................................... 103
Figure 6.6: Labour Productivity ................................................................................................................ 104
Figure 6.7: Enterprise Efficiency: Capital – Output Ratio........................................................................ 105
Figure 7.1: A Graph Showing Perception of the Status of Participation and Inclusiveness:................. 121
Figure 7.2: A Bar Chart Showing Perception of the Status of Participation and Inclusiveness: June 2009
................................................................................................................................................................... 121
Figure 7.3: A Graph Showing Perception of the Status of Democracy: June 2009............................... 122
Figure 7.4: A Bar Chart Showing Perception of the Status of Democracy: June 2009 ......................... 123
Figure 7.5: A Graph Showing Perception of the Status of Corruption in Mwanyanya and Chachani
Shehias: June 2009 .................................................................................................................................. 124
Figure 7.6: A Bar Chart Showing Perception of the Status of Corruption in Mwanyanya and Chachani
Shehias: June 2009 .................................................................................................................................. 124
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ACKNOWLEDGEMENT
This report was commissioned by the Revolutionary Government of Zanzibar through the MKUZA
Secretariat. The theme of this report was discussed and approved by the meeting of all Principal
Secretaries, chaired by the then Chief Secretary, Mr. Ramadhan Muombwa, that was held at Bwawani
Hotel on 30th November 2008. The meeting was attended by the following; Ms. Amina Shaaban, Mr.
Makame Vuai Simai, Dr. Mohamed A. Jidawy, Dr. Abdulhamid Y. Mzee, Dr. Omar D. Shajak, Mr.
Hassan Hamad Juma and Mr. Makame Abdulrahman. Others who attended the meeting are Mr. Salum
M. Salum, Mr. Affan O. Maalim, Mr. Msham A. Khamis, Mr. Mwalimu A. Mwalimu, Mr. Ali V. Vuai and
Mr. Shariff A. Sharrif.
The actual preparation of the report was organized by the Zanzibar Institute of Financial Administration
(ZIFA) under the guidance of Dr. Hamed R.H. Hikmany, Mr. Rashid Kibao and Mr. Kamal Kombo
Bakari. The drafting team for this report was made up of Mr. Kamal Kombo Bakari, Dr. Hamed
Hikmany, Mr. Rashid Kibao, Mr. Zaidu J. Ussi, Mr. Iddi H. Makame, Mr. Abdulla A. Sendaro and Mr.
Hassan K. Hassan. Dr. Hamed R.H. Hikmany read each draft of this report and offered valuable
suggestions both in terms of the substance and in terms of editorial corrections. Three consultants from
the Department of Economics of the University of Dar es Salaam were commissioned for this work.
These are Dr. Adolf F. Mkenda who took the lead in drafting chapters one, two, four and five and was in
charge of putting together the whole report, Dr. Oswald Mashindano who took the lead in drafting
chapters six and seven and Dr. John K. Mduma who took the lead in drafting chapter three. Several
background papers were prepared for this report. The following participated in authoring the
background papers that were useful as input into this report; Ms. Estella N. Hassan, Mr. Kai B.
Mbarouk, Mr. Mwinyiussi Hassan, Mr. Suleiman S. Msaraka, Mr. Idriss A. Shamte, Mr. Mbawana O.
Mbwana, Mr. Said S. Mzee, Mr. Kombo M. Kombo, Mr. Iddi S. Haji, Zaidu Juma Ussi and Dr. Adolf F.
Mkenda. Ms. Halima Rajab Mwinyi helps with typesetting of the whole document. Mr. Mahadhi Juma
Omar, the Principal Secretary for Constitutional Affairs and Good Governance and Dr. Beatrice K.
Mkenda of the University of Dar es Salaam read the entire draft and made valuable editorial
suggestions.
The Office of the Chief Government Statistician (OCGS) made a number of data available for this study,
particularly the 2004/2005 Household Budget Survey data and various statistical abstracts. Special
thanks are due to Mr. Mohammed Hafidh Rajab, the Chief Government Statistician and Mr. Amour H.
Bakari and Abdallah Othman Makame also of the OCGS in Zanzibar. Without the support of the OCGS
this work would not have been possible. Mr.Khalid Masoud Waziri from the Ministry of Education and
Vocational Training availed educational data for this report and was kind enough to explain a number of
things regarding the data. Ms. Attiye J. Shaame from the Ministry of Health and Social Welfare also
assisted with both availing the data and giving interpretation to data related to health.
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Mr. Amon Manyama of the UNDP has constantly offered support for this project, including attending
meetings that discussed various drafts of this report and offered valuable advice and encouragement.
Dr. Bandara, also of the UNDP Dar es Salaam offered numerous valuable advices during the
preparation of this report.
Drafts of this report were discussed in a stakeholder meeting in October 2009 in which numerous
suggestions were put forward to improve the report. The following participated in this stakeholders’
workshop;
Mr. Abdulhamid Yahya Mzee - Principal Secretary President Office and Chief Secretary, Mr. Khamis
Mussa Omar - Ministry of Finance & Economic Affairs, Mr. Julian Raphael Banzi - Principal Secretary
President Office, Mr. Mahadhi Juma Maalim - Ps Ministry of State, Constitutional Affairs and Good
Governance, Mr. Mwalimu Ali Mwalimu - Ministry of Water, Construction, Energy and Land, Mr. Said
Abdulla Natepe - Ps Ministry of State (President Office) Regional Administration and Special
Departments, Mr. Chrispin Kapinga - UNDP Resident Representative Zanzibar, Mr. Remidius E. Kissasi
- Representative from Zanzibar National Chamber of Commerce, Industry and Agriculture, Mr. Francois
Rumeci - UNICEF Representative - Zanzibar
The financial support from the UNDP towards the preparation and production of this report is highly
appreciated.
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FOREWORD
This is the first Human Development Report for Zanzibar. This report evaluates the achievement of
Zanzibar in terms of human development. It covers such important issues as income and income
distribution, education, health, gender, governance and inclusiveness. The theme of this report is
“Towards Pro-poor Growth”, signifying that for economic growth to be meaningful it must lead to
significant poverty reduction.
Consistent with the spirit of human development approach, this report was prepared in a participatory
manner so as to reflect the true aspirations of the people of Zanzibar. After all, since human
development approach is premised on the self-evident fact that human being is the end of, rather than
the means for, development, then people must have a say in shaping and evaluating development.
The first global Human Development Report was issued by the UNDP in 1990, and ever since such
report is issued every year. Several countries and territories have adopted the approach of producing
Human Development Report at a regular interval. Tanzania Mainland has for sometimes now been
producing the Poverty and Human Development Report (PHDR) at a regular interval of two years. It is
therefore proper that Zanzibar, which is an autonomous part of the United Republic of Tanzania with its
own system of political and economic governance, produces its report.
Indeed Tanzania, of which Zanzibar is an autonomous part, has long recognized that development
means nothing if it does not focus on people. The common refrain in the United Republic of Tanzania in
the 1960s was “lengo la maendeleo ni watu”, that is, people are the end of development. Within
Zanzibar this refrain went even further. The 1964 revolution of Zanzibar was a rejection of any form of
“development” that ignores human dignity, equity, freedom and human right. The revolution came about
because of the marginalization of the majority of the people and the extensive denial of freedom and
human right. The economic system that existed in Zanzibar prior to the revolution was such that
extreme and growing inequality was deliberately promoted and there was a rampant social, political and
economic marginalization and exclusion of the majority of the people. The growth of the national
income, no matter how high, was not going to assuage the majority of Zanzibar people who clamoured
for social justice and better living standard. The People of Zanzibar recognized that real development
cannot be attained by the growth of the national income alone; they wanted a more equitable
distribution of income, better education, a better health care and above all, they wanted social justice
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and human right. They wanted each individual to have dignity and to count as much as anybody else in
deciding the destiny of Zanzibar. The spirit of the revolution continues to inspire the people of Zanzibar
in seeking development in its multidimensional extent. This report is a testament of this continuing
quest.
A number of decades were lost by the world through overly focusing on economic growth while paying
too little attention to other dimensions of human development. Time has shown that the trickle down
effect that was believed to happen automatically following high economic growth is largely a myth. It
has now become clear that development can only take place if concerted effort is exerted not only
towards attaining higher economic growth, but also towards promoting dimensions of human
development that are intrinsically valuable such as longevity of life, health and education. Human
development approach has now gained widespread acceptance thanks to many people, in particular
the Nobel winning economist, Professor Amartya Sen, who launched a sustained campaign1 to reorient
the focus of development from things and income to a more multidimensional outlook with the
philosophy that “Human beings are the real end of all activities, and development must be centred on
enhancing their achievements, freedoms and capabilities (Anand and Sen 1994). The human
development approach has now gained the valuable support of the United Nations Development
Program (UNDP).
Even though this is the first Human Development Report to be issued in Zanzibar, it is gratifying that it
fits very well with the historical aspirations of Tanzania and in particular of Zanzibar. The philosophy
that guides Human Development Approach is in consonance with the philosophy that has guided
Zanzibar since the Revolution. Above all, this report dovetails very well with the ongoing efforts for
fostering economic growth and reducing poverty as articulated in MKUZA, the VISION 2020 and the
Millennium Development Goals.
This report constitutes a useful monitoring tool for assessing the extent that we live up to our historical
aspirations and the extent to which we are succeeding in implementing MKUZA, the VISION and the
Professor Amartya K. Sen is credited with formulating and advocating changes in the way economics evaluate welfare. He
argued against the exclusive focus on utility or commodities and proposed a wide approach of using functioning and
capabilities in evaluating welfare. Prior to this others had advocated the use of Basic Needs approach in evaluating
development rather than just focusing on income only. Sen’s rigorous and even devastating criticism of the exclusive focus
on income in evaluating development, coupled with his towering stature in the economic profession, had a great deal of
influence in shaping the Human Development Approach.
1
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Millennium Development Goals. There is no doubt that the Revolutionary Government of Zanzibar
would use this report for critical self evaluation and would also encourage effort to seek ways of scaling
up and sustaining some of the achievements identified in this report.
This report should stimulate deep reflections, encourage useful and critical debates and inspire
advocacy for positive change. Members of the House of the Representatives, leaders of political
parties, civic organizations and other groups are encouraged to use this report for reflections and for
advocating positive change.
The Revolutionary Government of Zanzibar would wish to thank the UNDP for funding the preparation
and the production of this report. Individuals who took part in drafting the report as well as those who
offered comments to shape this report have done a good job which is appreciated by the Revolutionary
Government. MKUZA secretariat and the Zanzibar Institute of Financial Administration did a
commendable job in overseeing this process.
Khamis Mussa Omar
Principal Secretary
Ministry of Finance and Economic Affairs
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EXECTUTIVE SUMMARY
Human Development Situation in Zanzibar
This is the first Human Development Report for Zanzibar. Human Development Report was first issued
by the UNDP for the whole world in 1990. Ever since, such report is issued every year. Each report
gives a focus on a specific theme, but the overall aim of Human Development Reports remains the
same, that is, to spur human development in its multidimensional reach. Indeed, Human Development
Reports have encouraged a broader evaluation of human development.
It is now more recognized that GDP is not a sufficient measure of human development, other
dimensions of human development such as longevity of life, low morbidity, education and freedom are
equally, if not more important, in evaluating human development. Indeed, the self-evident truth that
income is just a means rather than the end of development is gaining more practical recognition thanks
to among others, the annual global Human Development Reports.
The success of the global UNDP Human Development Reports has spurred many countries and
territories to produce country or territorial human development reports. Tanzania Mainland, which is
part of the United Republic of Tanzania, has been issuing its Human Development Reports under the
name of Poverty and Human Development Report after every two years for some time now. It is proper
that Zanzibar, which is an autonomous part of the United Republic of Tanzania, also issue its own
Human Development Report.
After wide consultation, it was agreed that the theme of this Human Development Report be Towards
Pro-Poor Growth. This theme makes it clear that the objective of attaining economic growth in Zanzibar
must also focus on poverty reduction. Indeed, MKUZA makes it explicit that Zanzibar aims at attaining
broad-based or pro-poor growth. It was further agreed that within the theme of pro-poor growth, issues
of tourism and development, the development of the micro, small and medium scale enterprises in
Zanzibar and the issue of good governance be covered. The traditional coverage of human
development situation features in this report together with in-depth analyses of growth and poverty
reduction and poverty and income distribution.
One of the major highlights of Human Development Reports is the Human Development Index. In this
report such index is calculated for the year of 2005, the year that has a complete set of data for
constructing the index along the line of the global Human Development Index. The Table below reports
the Human Development Index for administrative regions in Zanzibar in 2005. The region that is doing
relatively better is the one whose index is closer to one, and regions that are not doing very well have
index with values closer to zero. In the Table below it can be seen that there is significant variation in
human development across administrative districts of Zanzibar. Mjini/Magharibi region is doing much
better than other regions, followed by Unguja Kusini and then Pemba Kusini. Pemba Kaskazini is worse
than any other region, followed by Unguja Kaskazini. There does not appear to be any systematic
disparity in terms of welfare between Unguja Island and Pemba Island.
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Human Development Index by Administrative Region for 2005
Region
Mjini/Magharibi
Kusini Unguja
Kusini Pemba
Kaskazini Unguja
Pemba Kaskazini
HDI
0.8557294
0.653992476
0.639721323
0.600669223
0.5590927
However, a number of other indicators, such as the mean household expenditure and poverty rate
indicate that districts in Pemba tend to be worse off compared to districts in Unguja. This kind of
geographical disparity needs to be addressed. Indeed, as reported in Chapter Four, there is now
significant investment in infrastructure in Pemba, which suggests that this disparity would eventually
disappear. Still, analysis of budgetary allocation to districts does not suggest that poverty levels are
taken into account in determining such allocation.
The data for poverty that are used in this report are from the 2004/2005 Household Budget Survey for
Zanzibar. This is the latest dataset suitable for comprehensive analysis of income poverty. This data
indicate that poverty is still very high in Zanzibar. However, the projection done in this report using the
GDP indicates that poverty might have declined significantly in Zanzibar between 2004/2005. The new
Household Budget Survey dataset that is going to be released soon would offer more comprehensive
picture. Furthermore the next series of Zanzibar Human Development Report will offer an update
status of human development
Income may not be the end of economic development, but it remains an important instrument for
achieving higher human development. The macroeconomic data indicates that Zanzibar has been
enjoying positive income growth since 1991, and that the growth in the 2000s is higher than in 1990s.
Various indications of health show that Zanzibar is making some progress. Using nutritional indicators,
Zanzibar outperform Tanzania Mainland. Zanzibar is also on track to attaining health-related MDGs.
Private health facilities are concentrated in very few districts. These facilities seem to be attracted by
high income but not by the general need for medical attention. This means that the government must
continue to play a key role in providing health services, otherwise the poor would be left out.
Zanzibar has an impressive gross enrolment ratio in schools, but this tapers out very significantly at the
tertiary level of education. Over 90 percent of school teachers have been trained as educationists.
Overall, however, the highest education of teachers prior to being trained in education is generally low
and this has a negative effect on the quality of education. There is still an insignificant representation of
females in key decision making bodies and executive positions. There is a need for a strategy for
redressing this gender imbalance to be put in place.
_______________________________________________________________________________ 16
Tourism and Development
Zanzibar has, arguably, the best tourist attractions and is most suitably located to attract tourists than
any other country/territories in the West Indian Ocean. Yet Mauritius and Seychelles collect by far more
revenue from tourism than Zanzibar. The two island nations are also far ahead in terms of Human
Development Index than Zanzibar.
A salient feature of tourism in Zanzibar is that even though it contributes about 25 percent of the GDP, it
does not generate significant direct employment. It appears therefore that rather than considering
tourism as an avenue for generating mass employment, it should be considered as an avenue for
generating revenue that can be used to diversify the economy and thus indirectly contribute to
employment creation in other sectors. Even then, there is a need to find resources to train more
Zanzibaris fields related to the hospitality industry so as to expand significantly the employability of the
local people in the tourist industry. It may be necessary to introduce training levy on tourists’ hotels to
be used to train the Zanzibaris within Zanzibar and abroad in the tourists’ management and
administration skills and such related fields as languages, management of travel logistics and so on.
This must be done with the aim of attaining internationally recognized standards. Institutions that are
currently offering this training in Zanzibar and Tanzania in general need to be inspected regularly to
ensure quality and a condition for obtaining international accreditation must be imposed. Scholarships
to train Zanzibaris abroad on hotel management and related fields need also to be established.
Zanzibar rakes in fewer dollars per tourist compared to the island nations in the West Indian Ocean.
This is because in spite of the existing policy, Zanzibar has no proper strategy to attract up-market
tourism which must include development of conference facilities of international standards to attract
conference tourism, and through encouraging investment into large high class hotels with golf course,
spa and other attractions. One step that needs to be taken is to revoke land lease on all land that is idle
but being held speculatively so that more serious investors can be encouraged to step in. Secondly the
government need to insist that any new hotel has to be five stars and large enough to cater for upmarket large tourism. The Zanzibar International Airport must also be upgraded to handle larger traffic
and improve its standard. In order to attract more up-market tourism, it is important also to reform the
financial and insurance institutions and improve health services to international standards both for the
benefit of the population and tourists.
There is a need to put in place better system for collecting government revenues from tourism. This
must involve closer monitoring of the flow of tourism and tightening law to ensure that each hotel pay all
necessary taxes.
_______________________________________________________________________________ 17
MSMEs
This report further looked at the performance and prospects of the micro, small and medium business
enterprises (MSMEs) in terms of its role in economic growth and poverty reduction in Zanzibar.
Generally, MSMEs have the potential to provide livelihood for a considerably large number of people in
Zanzibar and other countries in the region. The findings show that Unguja is home for most enterprises
(70%) compared to Pemba (30%). There are big variations between regions and between districts in
terms of MSMEs distribution. MSMEs in Zanzibar are dominated by the micro-enterprises with between
1 and 2 employees (72 percent). However, this study reveals that overtime employment opportunities in
terms of the total number of workers employed by the business firms has tended to increase. Both the
business register and business census indicate that majority of businesses (MSMEs) are owned by
families. This is mainly intended to ensure security of assets as well as a means of minimizing
operating costs.
Electricity, skills and education rank higher as major obstacles to enterprise operations and growth,
while taxation, customs and trade regulations, as well as corruption also rank higher as very severe
obstacles to the enterprise operations and productivity in Zanzibar. Indeed these skills, regulations and
corruption obstacles are critical investment determining factors not only in Zanzibar, but also in other
countries in the region such as Tanzania Mainland, Kenya, and Uganda. Judging from a few
performance indicators namely, labour productivity and capital – output ratio, the MSMEs in Zanzibar
have recorded good performance. This also reveals the existing growth potential of this sector if
measures are taken to address the major constraints affecting growth and operations of the enterprises.
The association of MSMEs and poverty or livelihood in Zanzibar is evidenced by generation of
employment opportunities and the forward and backward linkages MSMEs have with other sectors such
as tourism, agriculture, forestry, fishing, and engineering.
Most areas of Zanzibar have a lot of resources. What is missing is the entrepreneurial drive and skills to
see the opportunities and to have the drive, vision and ability to exploit them profitably. A great deal of
capacity building of rural communities and entrepreneurs is required to stimulate their drive and
imagination and to impart business skills. MSMEs in Zanzibar would also require appropriate financial
services and/or credit accessibility, and market accessibility.
Owing to the importance and role of MSMEs, the RGoZ has to address the major obstacles to
enterprise growth and operations. The government must make strategic investment which targets the
growth drivers (Pace Makers). These strategic interventions must target the growth drivers such as
electricity supply, transport and the road network. Unless such obstacles are eliminated MSMEs will
have limited space to expand. It is also critical to rationalize taxation. For example, the Revolutionary
Government of Zanzibar needs to work towards reducing the burden that tax rate and tax administration
impose upon enterprises, rather than focusing on tax reforms which are geared towards improving
compliance alone.
_______________________________________________________________________________ 18
Governance
This report also explored how governance factors can influence pro poor growth and livelihood in
Zanzibar. Zanzibar has not officially started implementation of the Local Government Reforms partly
because some of the important pre-requisites particularly the required capacities are not in place. In
addition, peculiarities of Zanzibar have created some different views as to whether there is any
rationale to incur such massive costs and implement the reforms, when it is very clear that the
grassroots of Zanzibar can easily be reached by the Central Government. However, judging from
gradual measures and steps taken so far to empower the grass-root administrative units, and the
functions performed by these governance structures, it is evident that overtime some degree of
decentralization is already taking place. Both decentralization and democracy in Zanzibar have created
the needed awareness among community members and improved accountability and the sense of
ownership of the public infrastructure.
With the exception of corruption particularly in the two surveyed Shehias of Mwanyanya and Chachani,
there has been some notable improvement overtime in terms of the performance of governance
variables in Zanzibar. These are mainly participation, inclusiveness, and democracy. It is evident also
that, this improvement has been translated into the changing pattern of economic activities in
agriculture and livestock, and more basic facilities such as schools, water projects, and health facilities.
These are the basis for improved quality of life of the people. In addition, more legal services such as
contract formation and dispute settlement have also been made available to the people through the
lower level governance institutions.
The present local government structure in Zanzibar is neither efficient nor effective and does not
support pro poor growth initiatives in Zanzibar. Apart from giving local government structures more
powers, there is inadequate capacity for the existing governance units at the lower level to execute their
functions and be able to meet the enormous prevailing demands for governance services. Capacity
building of the local governance institutions is therefore inevitable.
As noted earlier, a Ward is another important government structure at a lower level. However, in
Zanzibar this is only an election constituency for electing Councillors. Such governance structures are
not as efficient and effective as the grass-root structures of the Mainland governance system where
there is great harmony between the Councillors and village governing bodies. In the Mainland, the two
have tended to work together and attend village as well as ward forums together. Unlike Zanzibar,
participation of both parties in decision making process is highly integrated and harmonized. This is not
the case in the isle where Councillor and Shehas have been the two parallel and conflicting structures
despite the fact that they serve the same constituency (people).
Unlike Shehas, Councillors in the Isle are just political figures who do not have executive powers.
Administratively, Shehas are more powerful than councillors, and the two do not normally support each
_______________________________________________________________________________ 19
other in community development matters. There is therefore an urgent need to ensure harmonization of
these diverging interests so that both the two sides are made to serve the interests of the people.
_______________________________________________________________________________ 20
CHAPTER 1: INTRODUCTION
1.1
Towards Pro-poor Growth
This report focuses on human development as a multidimensional concept. Income is an important
index of development, but it is important because it is a means for achieving other intrinsically valuable
ends such as longevity of life, low morbidity, knowledge and so on. An exclusive focus on income fails
to register other achievements and failures because there is no perfect correlation between income and
other valuable achievements such as longevity of life, low morbidity, freedom, human right and
education. The report therefore focuses at income and other metrics of development. Further, this
report does not confine itself to averages; attempts is made to look at the way development is
distributed across households, districts, regions and between the two main islands of Zanzibar of
Pemba and Unguja (the later is also often referred to as Zanzibar).
This report adds to the monitoring and evaluation tools of MKUZA, and it would serve as standard
reference for both policy and advocacy until the next report is issued.
Consistent with MKUZA, this report focuses on both growth and poverty reduction. MKUZA talks of
broad-based growth and pro-poor growth, meaning that Zanzibar aims at fostering economic growth
that contributes significantly to poverty reduction. Economic growth on its own is not sufficient; growth
must also be pro-poor. Hence the sub-title of this report, which reflects its main theme, is Towards Pro
poor Growth. In the context of human development, pro poor growth does not just mean growth that
increases the income of the poor, but growth that also expands opportunities and increases
achievements of the poor in education, health and other necessities of life.
1.2
Data
Various data has been used in this report. Apart from some very limited surveys carried out specific for
this report, all other data used in this report is from secondary official sources. The Office of the Chief
Government Statistician supplied most of the data used in the report. Government ministries have also
been very supportive in supplying the data. As would be noticed, most of the macroeconomic data are
up to date, mostly up to the year 2008. Unfortunately, microeconomic data, particularly the household
budget survey data, are only collected after an interval of several years. For example, the latest
household budget survey data was collected in 2004/2005. Some people would protest the use of such
data because it may not reflect the current reality. Such protest, however, misses the point. A Human
Development Report does not only give the current state of affairs, it must also, for as much as
possible, show the trend by reporting the state of affaires in the past.
Human Development Report has two components. One component gives a summary of human
development in terms of indices particularly across geographical entities. The second component
involves a detailed analysis of selected aspects of human development report. With regards to the first
_______________________________________________________________________________ 21
component, this report gives a ranking of the administrative regions of Zanzibar in terms of the Human
Development Index developed specific for Zanzibar. This index cannot be compared to the indices used
in the global Human Development Report because there is no GDP per capita by administrative regions
in Zanzibar. Rather, this report makes use of mean household consumption data as reported in the
household budget survey. Since the last household budget survey was collected in 2004/2005, the
human development index that is reported in the next section is for the year 2005 and it serves as a
baseline upon which the next report would use together with the new household budget survey data to
construct a trend in human development in Zanzibar.
The second component of the report gives a more detailed analysis of human development situation in
Zanzibar together with a special focus on selected themes. This report focuses on tourism, micro, small
and medium enterprises and the issue of governance and inclusiveness. Even though this kind of report
normally focuses only on one chosen thematic topic, there was a general consensus during the
participatory process that this report includes the three thematic areas mentioned above. All these
areas are, however, explored under the rubric of pro-poor growth consistent with the main theme of this
report..
1.3
Summary of Human Development Situation in Zanzibar
This section reports human development index across administrative regions of Zanzibar. The index is
constructed from three components; life expectancy, knowledge and income. Because of the nature of
the data used, the coverage would be limited to administrative regions. Before the index is presented,
each of the aspect of human development will be looked at separately.
Table 1.1 reports life expectancy by administrative regions of Zanzibar; the ranking is based on the life
expectancy for the year of 2008. Magharibi region and Pemba Kusini have the highest life expectancy
in Zanzibar. Unguja Kaskazini and Pemba Kaskazini have the lowest life expectancy.
Table 1.1: Life Expectancy by Region (With HIV Incidence Taken into Account)
Region/Year
Mjini/Magharibi
Pemba Kusini
Unguja Kusini
Unguja Kaskazini
Pemba Kaskazini
2003
58.4
56.7
58
54.5
53.5
2004
59.9
57.9
57.8
55.5
54.1
2005
59.7
59.2
57.7
56.5
54.7
2006
60.1
59.6
58
56.9
55.1
2007
60.4
60
58.4
57.3
55.5
2008
60.8
60.3
58.7
57.7
55.9
_______________________________________________________________________________ 22
Table 1.2: Gross Enrolment Ratio by Region (Basic)
Region
2004
Magharibi
113.3552
Unguja Kusini
86.87062
Unguja Kaskazini
88.06764
Pemba Kusini
80.01497
Pemba Kaskazini
74.26074
Source: MoEVT Budget Speech 2004-2008
2005
115.9035
84.31591
87.88811
81.69446
75.44319
2006
77.77712
84.36721
76.03453
72.95563
68.02028
2007
104.1681
104.9559
91.21294
86.23717
81.17674
2008
108.3358
108.1812
93.23801
85.8076
78.98058
Table 1.2 reports gross enrolment ratio for basic education by administrative regions in Zanzibar. Based
on the 2008 ranking, Magharibi region and Unguja Kusini have the highest gross enrolment ratio. The
two regions of Pemba, namely Pemba Kusini and Pemba Kaskazini have the lowest gross enrolment
ratio.
Table 1.3: Adult Literacy Rate by Region in 2004/2005
Region
Magharibi
Unguja Kusini
Pemba Kusini
Unguja Kaskazini
Pemba Kaskazini
Source: MoEVT Budget Speech 2004-2008
Literacy Rate
0.9037648
0.8487247
0.692986
0.6387333
0.5862012
Table 1.3 reports adult literacy rates by administrative regions. Once again, Magharibi region has the
highest adult literacy rate, followed by Zanzibar Kusini and Pemba Kusini. The region with the lowest
literacy rate is Pemba Kaskazini followed by Unguja Kaskazini.
Table 1.4: Mean Household Expenditure over 28 Days per Region in 2004/2005
Region
Mean Household Expenditure of 28 Days
Magharibi
27822.37
Unguja Kusini
23458.03
Pemba Kusini
22997.54
Unguja Kaskazini
22876.79
Pemba Kaskazini
17864.49
Source: Household Budget Survey 2004-2005
Table 1.4 reports mean household expenditure over 28 days by administrative regions; this data is from
the household budget survey data collected in 2004/2005. Once again, Magharibi region has the
highest mean household expenditure, followed by Zanzibar Kusini and then by Pemba Kusini. The
region with the lowest mean household expenditure is Pemba Kaskazini, followed by Zanzibar
Kaskazini.
Based on the data presented above, a Human Development Index is developed which is reported by
administrative regions in Table 1.5. This index is developed along the line of the global human
development index except for few modifications. First, as explained above, rather than using real per
_______________________________________________________________________________ 23
capita income, this index uses mean household monthly expenditure from the household survey data.
Secondly the maximum and minimum used for calculating income index is based on the maximum and
minimum mean household expenditure in Zanzibar in 2004/2005. The maximum and minimum life
expectancy used for calculating life expectancy index is 85 and 25 years, respectively, consistent with
the global approach.
Table 1.5: Human Development Index by Administrative Region for 2005
Region
Magharibi
Unguja Kusini
Pemba Kusini
Unguja Kaskazini
Pemba Kaskazini
HDI
0.8557294
0.653992476
0.639721323
0.600669223
0.5590927
The Human Development Index reported on Table 1.5 shows that Magharibi region is doing far better
than other regions. This is followed by Unguja Kusini and then Pemba Kusini. Pemba Kaskazini is
worse off than any other administrative region, followed by Unguja Kaskazini. There is no clear pattern
of the distribution of human development between the two major islands of Unguja and Pemba.
However the disparity between administrative regions is big meriting attention in the distribution of
resources and developmental efforts. Moreover, Pemba Kaskazini trails all other regions in each human
development dimension examined above. There is a need to explore the reasons for this and develop
strategy to resolve this problem.
Organization of the Report
This report is organized into eight chapters. Chapter two is on the human development situation in
Zanzibar. This chapter focuses in a more detailed way on four main dimensions of human development,
namely income, health, education and gender. Chapter three extends the analysis of chapter two by
looking at national income and distribution. Chapter four also extends the analysis of chapter two by
analyzing poverty and household income distribution. Chapter five delves on the issue of tourism in
Zanzibar. Tourism has become one of the mainstays of Zanzibar’s economy and therefore it can be
used to foster higher growth. However, the full potential of tourism in Zanzibar is yet to be tapped. In
spite of its potential to growth, tourism has an unwelcome tendency of producing a highly skewed
income distribution. Furthermore, tourism tends to maintain a very weak backward and forward links to
the rest of the economy. Tourism therefore needs to be guided by deliberate policy that promotes broad
distribution of its benefits and fosters stronger links with the rest of the economy. This chapter therefore
looks at tourism performance and its links to human development in Zanzibar in view of identifying
policy interventions necessary for human development. Chapter six is on micro, small and medium
scale enterprises, MSME. The poor cannot command large capital and sophisticated managerial skills
to run large enterprises, but they may be able to run micro, small and even medium enterprises.
Indeed, Zanzibar itself may not be able to internally generate enough capital and skills to establish large
_______________________________________________________________________________ 24
scale enterprises to the extent it requires for generating employment and income. Micro, small and
medium enterprises however seem to be within relatively easy and immediate reach. Chapter six
therefore looks at whether MSME offers an exit valve out of poverty in Zanzibar. Chapter seven is on
governance, participation and inclusiveness. As has been argued above, human development is about
capabilities, functionings and freedom. This means that good governance, participation and
inclusiveness are essential ingredients for pro-poor growth. Chapter eight offers key messages from
this report.
_______________________________________________________________________________ 25
CHAPTER 2: STATUS OF HUMAN DEVELOPMENT IN ZANZIBAR
2.1
Global Context
Zanzibar is an autonomous part of the United Republic of Tanzania and thus its global ranking in terms
of human development index is reflected by the position occupied by the United Republic of Tanzania.
Tanzania is routinely classified as a Low Human Development Country. In the 2009 UNDP Human
Development Report Tanzania was ranked 151 out of 177 countries. Tanzania scored HDI of 0.530,
which is slightly above the average HDI for Sub Saharan Africa of 0.514. Seychelles, which has one of
the best human development achievements in Sub Saharan Africa, is ranked at the position of 57 with
the HDI measure of 0.845, well ahead of Tanzania. It is clear that Tanzania, and therefore Zanzibar,
has a long way to go in improving its human development situation.
Zanzibar aspires to achieve the Millennium Development Goals (MDGs) in the quest of improving its
human development situation. MKUZA is the strategy of the Revolutionary Government of Zanzibar for
stimulating economic growth and reducing poverty. Each of the government’s policy now gives an
overriding consideration to poverty reduction and economic growth. Indeed, the fundamental value that
guided the 1964 Revolution was the quest to improve the lives of the people of Zanzibar. Peoples’ lives
can only be sustainably improved if there is a sustainable pro-poor growth. There are various definitions
of the term pro-poor growth, but each definition identifies the significant reduction of poverty and
general improvement of the welfare of the people as the cornerstone of pro-poor growth.
In order to evaluate whether efforts to reduce poverty and improve human development is bearing fruits
it is important to describe the existing situation now and compare it to the past and use it to evaluate the
future. Unfortunately, there is no comprehensive data for constructing encompassing trends in the
human development in Zanzibar historically. The existing data can only offer limited opportunity to draw
historical trends. The rich data that now exists can, however, be used to form a baseline upon which
future progress can be evaluated. The aim of this chapter is therefore to present the human
development situation as it exists now in Zanzibar mostly as a baseline for assessing progress in the
future. The current situation would be assessed in terms of a number of dimensions of human
development. Spatial desegregation of these dimensions would be presented to the extent the data
permit so as to inform policy on any marked geographical disparities that require attention.
2.2
Dimensions of Human Development
Human Development approach was designed because it was generally felt that the focus on income
has not been sufficient in monitoring the development of the well being of the people. For example,
there are cases where a country or territory enjoys substantial per capita income while the people suffer
very high mortality rates. An exclusive focus on income would not alert policy makers of the need to
deal with the problem of high mortality rate. Further, a country or a territory may enjoy high per capita
_______________________________________________________________________________ 26
income while majority of the citizens enjoy no freedom or human right. Apartheid South Africa was an
obvious case in which the country enjoyed a per capita income that was significantly higher than that of
other Sub Saharan African countries, but majority of the citizens were denied freedom and human right
that was being enjoyed in the rest of Sub Saharan Africa. It therefore did not come as a surprise that a
good number of citizens of the Apartheid South African took refuge to other Sub Saharan African
countries, including Tanzania. An exclusive focus on GDP per capita would have told us that Apartheid
South Africa was better off than the rest of Sub Saharan Africa. A Human Development Approach on
the other hand would have taken into account several dimensions of human development, such as
freedom, health, knowledge, income and so on; such an approach would have easily shown that
Apartheid South Africa was worse off than most of Sub Saharan Africa.
Human Development Approach combines various dimensions of human well-being to evaluate
progress. The underlying philosophy of human development approach is that human being makes
progress only through attaining numerous functionings and capabilities that he/she has reason to value.
Income is important in human development approach but its importance is only because it is an
instrument for attaining something else that we value, such as good nutrition, low morbidity and long
life. Money is not of intrinsic importance, it is only of instrumental importance. Money is mainly included
in the human development approach because it creates capability to attain a number of functionings,
and because of its close, albeit imperfect, correlation with other valuable dimensions of human
development.
Another dimension of human development is longevity of life. We all aspire to live long. This is attested
by numerous and frantic effort we always make to save life and by the grief that we suffer when a
person dies. It is particularly devastating when a young life is lost. Child and infant mortality rates are
two of the most important indicators of whether progress is made in human development. Over-all, life
expectancy is an important indicator of human development.
Another dimension of human development that has been widely used is knowledge. It is assumed that
there is an intrinsic and universal quest to pursue knowledge. A person who manages to acquire more
knowledge than others is considered to be better off than others. Knowledge is important for its own
sake as well as for the sake of empowering a person to attain various other goals, including higher
earning and better enjoyment of life. There are various measures of knowledge that can be used in
assessing progress in terms of human development. Literacy rates, enrolment ratios at various levels of
_______________________________________________________________________________ 27
education
and
access
to
education
are
all
important
indicators
of
knowledge.
“It is certainly true that mortality rates are affected by poverty and economic deprivation. Personal
income is unquestionably a basic determinant of survival and death, and more generally of the
quality of life of a person. Nevertheless, income is only one variable among many that affect our
chances of enjoying life”.
Amartya Sen (1998)
Health is yet another common dimension of human development that is extensively employed both by
the global UNDP Human Development Report and by various national and territorial Human
Development Reports. Ill health has an obvious effect in reducing well being of a person. Health is also
valuable for its instrumental value; a person with good health tends to be more productive than a
person with ill health. Good health therefore increases income of an individual as well as of a nation.
Reduction in the morbidity is therefore an overriding objective. To be sure, life expectancy at birth gives
some general indicator of how health a population is. Other indicators include infant and child mortality,
and measures of wasting and stunting of children. Access to health care is also an important indicator
of health. Various indicators can be used to capture access to health facilities. These include number of
doctors per person, the distance to the nearest health centre and so on. We shall review these
measures for the case of Zanzibar in this report.
The number of indicators that can be used in a human development report is inexhaustible.
Nevertheless each report must choose dimensions of human development to which it wishes to focus
on. For example, The Millennium Development Goals, which encapsulate a global consensus, identify
the following as some of the major aspects of human development issues that need to be addressed
through national and global efforts:
i.
Extreme poverty; to live on less than a dollar a day.
ii. Hunger
iii. Failure to attain universal primary education
iv.
Gender inequality, particularly in education
v.
High Child Mortality Rate
vi.
Poor maternal health
vii.
Vulnerability to diseases such as HIV/AIDS, and high incidences of Malaria
viii.
Lack of access to safe drinking water
ix.
Poor and un-planned habitats
x.
Unemployment, particularly among youth.
In general, three dimensions of human development have received more frequent attention. These are
income (GDP per capita), knowledge (mostly through enrolment ratio) and health (through life
expectancy at birth). These are important dimensions but by all means not the only ones. Freedom is
_______________________________________________________________________________ 28
equally important to people; to some people freedom may actually rank higher than the three
dimensions mentioned above. That is why people sacrifice their lives in pursuit of freedom. Culture is
also very important to people. In many cases, culture and religious beliefs are intertwined and ranked
quite highly. The spirit of human development approach is to allow each people decide what is more
important to them, rather than imposing these paternalistically. That is why participatory approach is
very important in preparing countries’ human development reports.
It must also be born in mind that the global human development index focuses sharply on selected
indicators of human development not only because they are important, but also because there is
sufficient data to compare countries. Other dimensions of human development do not feature in the
Global Human Development Index simply because it is difficult to find data; this report shall include
indicators of some of human development dimensions that are generally not included in the global HDI.
2.3
GDP Per Capita and Household Expenditure; Trends and Spatial Dimensions
Arguing against exclusive focus on income in measuring human development does not mean that
income is not important. As noted above, income is important because it gives a person capability to
pursue a number of valuable attainments such as education and good nutrition. Indeed there is some
positive, albeit imperfect, correlation between income and other dimensions of human development
such as life expectancy, gross enrolment ratio and so on. It is therefore quite important to assess how
Zanzibar is performing in terms of income. Two sources of data would be used here. First, real GDP per
capita would be looked at to assess how Zanzibar has featured over time and evaluate its ranking
against Tanzania Mainland and against other countries in the world. Chapter three would pick these
issues further. Another source of information is the 2004/2005 Zanzibar Household Budget Survey
data. This data permits calculation of mean household per capita consumption by district. This makes it
possible to compare districts in terms of household expenditure. Unfortunately because of lack of
comparable data, we can neither get trends in household expenditure over time nor draw meaningful
comparisons with Tanzania Mainland and other countries. Nevertheless, looking at both National
Income Accounts and Household Budget Survey offers rich opportunity for assessing human
development situation in terms of income and forming useful baseline information for evaluation
progress in the future.
Figure 2.1 shows the trend of the real GDP in Zanzibar from 1991 to 2008. The Figure shows that
Zanzibar has been recording a steady economic growth since 1991 and that this growth accelerated in
the 2000. The average growth rate of the real GDP from 1991 to 2008 is 6.4 percent. It is notable that
there is an extraordinary high growth rate of 16 percent in 1996. If the figure for 1996 is taken away, the
average growth rate from 1991 to 2008 is 5.8 percent. The growth rate of the real GDP from 2001 to
2008 is 6.6. Over all there is progress in terms of increasing the growth of the economy.
_______________________________________________________________________________ 29
100
50
Real GDP
150
Figure 2.1: Trend in GDP in Zanzibar, 1991-2008
1990
1995
2000
2005
2010
Year
Figure 2.2 gives trend in the GDP per capita measured in the US dollar from 1991 to 2008. This figure
shows that over all, GDP per capita has enjoyed a steady growth particularly after 2000. The
fluctuations observed in the 1990 are partly accounted for by the fluctuation in the exchange rate.
100
200
Per Capita GDP (USD)
300
400
500
Figure 2.2: Trend in GDP per Capita in USD
1990
1995
2000
Year
2005
2010
This growth is due to macroeconomic policies that were pursued by Zanzibar since 1990. Some of the
measures that stimulated growth include liberalization of the economy to allow private sector to play
greater role and favourable policies to encourage investment. Further analysis of growth is reported in
chapter three of this report.
There is no data that disaggregate GDP by region or district in Zanzibar. This is a shortcoming that
makes it difficult to produce the standard Human Development Index by region or districts.
Nevertheless the 2004/05 Zanzibar Household Budget Survey offers some figures for household
consumption by districts. This of course is not an up to date data; it can only serve as a baseline for
assessing progress once new dataset becomes available.
The Household Budget Survey data shows that the Mean per Capital Household Expenditure for 28
days in 2004/2005 was Tshs. 21,155. This means that mean Per Capital Household Expenditure per a
day was Tshs 755. Table 2.1 gives the mean and median Total per Capita Household Expenditure for
28 by districts of Zanzibar. Mjini district has the highest mean per capita household expenditure,
_______________________________________________________________________________ 30
followed by Magharibi and Mkoani. Micheweni district has the lowest mean per capital household
expenditure, followed by Wete district and then Kaskazini B. There is no clear pattern of disparity
between Unguja and Pemba. Mkoani district, which ranks 3rd is in Pemba, and Chake Chake district,
also in Pemba ranks 5th out of the 10 districts. It is notable that Micheweni and Wete, the two districts at
the lowest end are both from Pemba. Further analysis of the 2004/2005 Household Budget Survey
data, particularly in terms of poverty and inequality, is offered in chapter 4 of this report.
Table 2.1: Per Capita Household Expenditure for 28 Days
DISTRICT
Total per Capital Household
Expenditure for 28 Days
Mean
Median
28749
22955
23105
19346
20412
17803
19901
16616
19234
16308
18134
15808
18099
15215
16667
14603
16322
14115
14287
12493
Mjini
Magharibi
Mkoani
Kati
Chake Chake
Kusini
Kaskazini A
Kaskazini B
Wete
Micheweni
Source: Calculated from the 2004/2005 Zanzibar Household Budget Survey Data
2.4
Health and Life Expectancy
The most common indicator of health that is used in the Human Development Reports is life
expectancy at birth. Table 2.2 reports life expectancy by region from 2003 to 2008 as projected from the
2002 census data. The life expectancy at birth ranges from 53 to 60 years. This is far below the highest
national life expectancy in countries such as Sweden, Japan and Canada, but it is better than the mean
life expectancy at birth for Sub Saharan Africa.
Table 2.2: Life Expectancy at Birth (with HIV Assumption)
Region/Year
Mjini/Magharibi
Unguja Kaskazini
Unguja Kusini
Pemba Kaskazini
Pemba Kusini
2003
58.4
54.5
58
53.5
56.7
2004
59.1
55.5
57.8
54.8
57.9
2005
59.7
56.5
57.7
54.7
59.2
2006
60.1
56.9
58
55.1
59.6
2007
60.4
57.3
58.4
55.5
60
2008
60.8
57.7
58.7
55.9
60.3
Souce: NBS Population Projections
_______________________________________________________________________________ 31
There are, however, several other useful indicators that can be used to assess health. Nutritional status
of children is another indicator of health. In this respect it is common to use the height for age measure,
also called stunting, the weight for height measure commonly referred to as wasting and weight for age,
which is a reasonable summary of both stunting and wasting. Table 2.3 gives measures of nutritional
status for Zanzibar, Unguja, Pemba and Tanzania Mainland for the year 1996 and 2004/05. The data
used here is from the national Demographic and Health Survey. This data was collected for the whole
of Tanzania at the same time, thus offering an opportunity to compare situation in Zanzibar against that
of the Tanzania Mainland.
In terms of stunting, Zanzibar is doing better than Tanzania Mainland for both 1996 and 2004/2005.
However, Zanzibar seems to suffer more wasting than Tanzania for both years. As for the weight for
age measure, Tanzania Mainland was doing better than Zanzibar in 1996 but this is slightly reversed in
2004/2005 where Zanzibar seems to suffer slightly less number of under-weight children than Tanzania
Mainland. It is not possible to compare Pemba and Unguja Island for the year 1996 because the
sampling procedure did not permit representativeness of the population of these islands separately.
However, in 2004/2005 we see that Pemba suffers more stunting and underweight than Unguja but
fares better in terms of wasting. There is an improvement of nutritional status in Zanzibar between 1996
and 2004/05. For example, the percentage of children with low weight for age dropped from 33.8 in
1996 to 19 in 2004/05.
Table 2.3: Nutritional Status in Zanzibar, Unguja, Pemba and the Rest of Tanzania
AREAS
YEAR
Mainland
Zanzibar
Unguja
Pemba
PERCENT
OF
STUNTED CHILDREN
1996
2004/05
43.6
38
37
23.1
n.a
18
n.a
32.1
PERCENT
OF
WASTING CHILDREN
1996
2004/05
7.1
2.9
11.0
6.1
n.a
6.7
n.a
4.9
PERCENT WITH LOW
WEIGHT FOR AGE
1996
2004/05
30.5
21.9
33.8
19
n.a
17
n.a
22.5
Source: National Bureau of Statistics (NBS)[Tanzania] and ORC (2005) and Bureau of Statistics [Tanzania] and
Macro International Inc (1997)
Another useful set of health indicators is mortality rates. Table 2.4 presents figures for infant, child and
under-five mortality rates. There is a decline in the infant mortality and under-5 mortality in Zanzibar
between 1996 and 2004/05, but child mortality increased from 34.8 to 42 over the same period. Over
all, Zanzibar fares better than the rest of Tanzania in terms of infant mortality, child mortality and underfive mortality. Of course globally, both Zanzibar and the rest of Tanzania need to do more to improve
the situation.
_______________________________________________________________________________ 32
Table 2.4: Infant, Child and Under-5 Mortality: Zanzibar vs. Tanzania Mainland
Infant Mortality
Child Mortality
Under 5 Mortality
ZANZIBAR
1996
2004/05
75.3
61
34.8
42
107.5
101
TANZANIA MAINLAND
1996
2004/05
94.7
83
56.6
42
146
133
Source: National Bureau of Statistics (NBS)[Tanzania] and ORC (2005) and Bureau of Statistics [Tanzania] and Macro
International Inc (1997
Another important aspect of health is morbidity. Recurrent ill health undermines one’s wellbeing and is
inimical to productivity. The 2004/2005 Household Budget Survey shows the percentage of individuals
that reported illness or injury by district and this is reproduced in Table 2.5. In this indicator, Mjini district
is doing by far better than other districts. Districts in Pemba are faring worse than districts in Unguja,
indicating that morbidity is higher in Pemba than in Unguja. Morbidity in tropical countries is influenced
a lot by the incidence of malaria and made worse by the TB and HIV infection.
Table 2 5: Percentage of Individuals Reporting Illness or Injury in the Past Four Weeks by District
(2004/2005)
DISTRICT
percent
Kaskazini A
23.3
Kaskazini B
19.3
Kati
18.3
Kusini
14.5
Magharibi
14
Mjini
9.2
Wete
28.6
Micheweni
25.8
Chake Chake
28.4
Mkoani
25.5
Source: OCGS (2006): Household Budget Survey 2004/2005
Table 2.6 reports progress that has been made so far in attaining health related Millennium
Development Goals. Zanzibar is on track with regards to the target of reducing by two third the underfive mortality rate More effort needs to be put in place with regards to the target of reducing maternity
related deaths. Regarding the reduction of HIV/AIDS spread there is mixed achievement; still more
needs to be done.
_______________________________________________________________________________ 33
Table 2.6: The MDG Progress on Health Related Targets
1990
2000
2002
2005/06
2006/07
2007
2008
2015
Status of progress
Indicators
TARGET NO.5: REDUCE BY TWO THIRD BETWEEN 1990 AND 2015, THE UNDER-FIVE MORTALITY RATE
Under five mortality rate
(per 1,000 live births)
202
nil
141*
101
nil
79
67
On track
Infant mortality rate (per
1,000 live births)
54
120 nil
89*
61
nil
40
On track
Proportion of children
vaccinated
against
87.9
86.5
measles
Nil
75.0
Nil
82
nil
100
On track
Neonatal mortality rate
Nil
nil
Nil
nil
-29
On track
TARGET NO 6. REDUCE BY THREE QUARTER BETWEEN 1990 AND 2015 THE MATERNAL MORTARLITY RATIO
Maternal mortality ratio
377
(per 100,000 live births) (1998)
nil
Nil
nil
473
362
422
170
un satisfactory
37
(1996)
Births attended by
Nil
49
nil
47
44.5
90
slow
skilled health personnel
Nil
TARGETS 7 HAVE HALTED BY 2015 AND BEGUN TO REVERSE THE SPREAD OF HIV/AIDS
TARGET 8: HAVE HALTED BY 2015 AND BEGUN TO REVERSE THE INCIDENCE OF MALARIA AND OTHER MAJOR DISEASES
Prevalence
rate
associated with TB (Per
100,000)
24
nil
Nil
51
nil
<24
Need more attention
Death rate associated
with TB case detected
5.1
6
and cured with DOTS
5.50
Nil
74
76
83
Nil
percent percent
On track
Prevalence
rate
associated with Malaria
percentof diagnosis
<1
Nil
49.2
46.2
44.6
0.8
percent
<49
Achieved
Death rate associated
with Malaria percentof
diagnosis
3.0
1.50
Nil
nil
Nil
nil
21.8
percent
nil
nil
HIV prevalence among
adults
0.6
0.6*
HIV prevalence among
pregnant women aged
15-24 years
1
0.8
<5
On track
Condom use rate
9.7
48.7
22.3
80
On track
Source; MOHSW, 2007; MDG tracking report
_______________________________________________________________________________ 34
Malaria
Malaria has been one of the major causes for morbidity and mortality in Zanzibar, but recently Zanzibar
has registered an impressive achievement by rolling back this scourge. Household surveys conducted
in Zanzibar during 2007–08 (RBM Indicator survey 2007/8 and THMIS 2007/8) confirm the population
prevalence of Plasmodium falciparum infection is less than one percent – down from 15 percent in
2003. This is an incredible achievement that has been brought about through the application of a
combination of approved interventions (improved case management, vector control by using
ITNs/LLINs and IRS, and the use of IPT for pregnant women). The scaling up of malaria laboratory
quality assurance is another step towards improved malaria diagnosis. Currently the malaria situation in
Zanzibar has changed from high to low endemicity.
The information from the routine HMIS collection describes the incidence of malaria confirmed by
district as reported by health facilities (public and private) in 2008 as shown in Table 2.7. Unguja was
found to have high incidence rate of about 2.0 percent compare to Pemba 0.7 percent.
Table 2.7: Malaria incidence per 100 population, 2008
DISTRICT
Chake Chake
Micheweni
Mkoani
Wete
Pemba districts
Kati
Kaskazini A
Kaskazini B
Kusini
Mjini
Magharibi
Unguja districts
Zanzibar
RATE
1.7
0.3
0.2
0.5
0.7
1.6
0.2
1.3
0.8
3.5
1.6
2.0
1.5
Source HMIS bulletin 2008
Tuberculosis
The number of newly diagnosed TB patients has not increased markedly since 2000, at slightly over
350 patients in 2000 to 369 in 2007. In 2008, a total of 428 patients were diagnosed, among them 407
(95 percent) were new patients. Out of 428 new patients 265 (65 percent) were smear positive, 69 (17
percent) smear negative and 73 (18 percent) were extra pulmonary TB patients. A total of 21 retreatment patients registered during 2008, among them 14 (66.7 percent) were relapse and 7 (33.3
percent) were failure and return to control. See table 2.8 for details.
_______________________________________________________________________________ 35
Table 2.8: Tuberculosis cases and treatment outcomes 2004 - 2008
YEAR
AFB+
AFB-
EP
RELAPSE
FAILURE/
OTHERS
RETURN TO
CONTROL
TOTAL
2004
2005
2006
2007
2008
240
191
238
231
265
55
62
41
70
69
51
53
44
48
73
11
14
9
19
21
6
1
7
1
5
5
347
330
344
368
328
Source: ZTB/Leprosy programme
Note: AFB = Acid Fast Bacillae
EP = Extra pulmonary
Table 2.9 reports the cases of tuberculosis and the treatment outcome for the years of 2007 and 2008.
Unguja has more than twice the cases of TB than Pemba
Table 2.9: Tuberculosis cases and treatment outcomes
UNGUJA
PEMBA
NOTIFICATION
2007
2008
2007
2008
New Cases
285
249
83
79
Smear positive
189
(66.3 221
(63 42
(50.6 44
(55.7
percent)
percent)
percent)
percent)
49
(17.2 58
(16 21
(25.3 11
(13.9
percent)
percent)
percent)
percent)
34
(11.9 52
(14 14
(17 21
(26.6
percent)
percent)
percent)
percent)
13
(4.6 18
(5 6
(7.2 3 (3.8 percent)
percent)
percent)
percent)
Smear negative
Extra Pulmonary
Relapse
Source: MOHSW Annual Report 2007/2009 TB and Leprosy
HIV/AIDS
HIV/AIDS is another scourge that Zanzibar, like other countries, has to contend with. The problem in
Zanzibar is not as big as in the rest of Tanzania, but there is no room for complacency. Out of tests
done to women during ante natal care services, 0.95 percent were found to be positive with HIV.
Unguja suffer more incidence than Pemba as reported in Table 2.10. Overall it is estimated that 0.6
percent of the population in Zanzibar is HIV positive with Unguja leading with 0.8 percent and Pemba
coming behind with 0.3 percent.
_______________________________________________________________________________ 36
Table 2.10: HIV cases found in Ante natal care services, 2008
Zone
HIV
Tested Positive percent
positive
8755
18
0.21
22658
281
1.24
31413
299
0.95
Pemba
Unguja
Zanzibar
MOHSW, Bulletin 2008
Table 2.11 gives the distribution of health facilities by districts in Zanzibar. Mjini has more health
facilities per capita, where each 2608 people are served by one health facility. The next districts with
few people per health facilities are Kati, Kusini, Kaskazini B and Chake Chake. The worse performers in
this case are Magharibi, Wete, Micheweni, Kaskazini A and Mkoani. Mkoani, which is the worse
performer in this score, has 111,601 people per health facility. Three out of four districts in Pemba have
district hospitals. Only Mjini district has a tertiary hospital. Private health facilities are concentrated in
Mjini and Magharibi; both are in Zanzibar town.
Table 2.11: Distribution of Health Facilities by District and Type, 2007
DISTRICT
Kaskazini ‘A’
Kaskazini ‘B’
Kati
Kusini
Magharibi
Mjini
Wete
Micheweni
Chake
Chake
Mkoani
Total
PHCU
1ST
LEVEL
9
8
19
7
10
6
17
9
9
PHCU
2ND
LEVEL
3
3
3
2
2
4
1
3
3
PHCC
DISTRICT
HOSPITAL
SPECIAL
HOSPITAL
TERTIARY
HOSPITAL
PRIVATE
FACILITIES
PARASTATAL
1
0
0
1
0
0
0
1
1
0
0
0
0
0
0
1
0
1
0
0
0
0
0
2
0
0
0
0
0
0
0
0
1
0
0
0
3
2
4
0
20
78
2
3
4
0
2
0
0
4
4
1
2
2
13
107
2
26
0
4
1
3
0
2
0
1
2
118
0
15
Source: Ministry of health and Social Welfare, Zanzibar
2.5
Knowledge and Education
Knowledge is one of the dimensions of human development that is used in the global Human
Development Report. Knowledge is useful for human wellbeing intrinsically in the sense that acquiring
knowledge fulfils one of our natural pursuits of life. A human being needs no other justification for
pursuing knowledge; knowledge is valuable in itself. However, knowledge is also useful instrumentally.
Knowledge is what makes it possible for us to master our environment and overcome numerous natural
_______________________________________________________________________________ 37
challenges. Knowledge is a source of scientific discoveries that continue to expand our capacity to
produce more material wealth and thus make our life more comfortable. Knowledge also is the source
of medical breakthroughs that continue to make it possible to cure and prevent a number of diseases
and thus increase both the quality and the longevity of our lives. It is natural therefore that when we
assess human development we should include knowledge as one of the metrics of achievement.
It is obviously not easy to measure knowledge itself. To circumvent this problem we focus on the quality
and the accessibility of formal institutional processes of producing knowledge. We also focus on the
outcomes that define achievements in the process of formal production of knowledge.
The global Human Development Report uses gross enrolment ratio as a measure of education
achievement because this is the data that is easy to get hold of for many countries. In this report both
enrolment ratios as well as a variety of dimensions of education quality shall be used.
Table 2.12 gives figures for gross enrolment ratio for the basic education in Zanzibar, which comprises
of primary level (Std I – Std VII) and 1st cycle of lower secondary education (Form 1 – Form 2). It must
be noted that in Zanzibar Basic and compulsory education is of nine years. In this score Zanzibar is
ahead of the rest of Eastern African countries.
Table 2.12: Gross Enrolment Ratio (Basic Education, STD 1 to Form 2)
DISTRICT
Mjini
Magharibi
Kaskazini A
Kaskazini B
Kati
Kusini
Micheweni
Wete
Chake Chake
Mkoani
TOTAL
Boys
2004
Girls
Total
77.3
73.9
75.6
87.3
89.9
88.6
227.9
241.5
234.7
120.8
124.4
122.6
98.2
93.9
96.0
91.5
99.3
95.4
75.6
76.3
75.9
79.5
89.9
84.5
90.0
91.5
90.7
101.0
103.2
102.1
84.7
76.1
80.3
113.5
108.6
111.1
77.4
69.8
73.7
82.1
80.7
81.4
72.7
76.7
74.6
80.7
81.3
81.0
85.4
83.9
84.7
88.2
90.9
89.5
77.0
74.2
75.6
83.5
82.9
83.2
92.0
91.1
91.5
92.8
95.7
94.2
Boys
2006
Girls
Total
Boys
86.4
129.7
94.9
80.1
107.2
113.2
75.1
82.7
87.2
83.1
94.1
2008
Girls
90.3
135.4
102.4
89.3
106.6
108.5
73.6
82.7
89.8
83.4
97.3
Total
88.3
132.6
98.6
84.6
106.9
110.9
74.4
82.7
88.5
83.3
95.7
Source: MoEVT – Budget Speech 2004 - 2008
Overall gross enrolment ratio for basic education stands at 95.7 percent, which is an improvement from
92 percent in 2004 and 94.2 percent in 2006. Further, girls register better gross enrolment ratio than
boys at 97.3, where as boys ratio is 94.1. It is notable however that gross enrolment ratio for districts in
Pemba is below that of districts in Unguja. Micheweni in Pemba has the worse gross enrolment ratio at
74.4.
_______________________________________________________________________________ 38
Table 2.13 gives the pass rates at the terminal examination of Form 2, the examination that decides
whether a pupil continues to Form 3 or not. There has been progressive improvement in the pass rate
from 44.4 percent in 2004 to 53.9 in 2008. The most remarkable thing about Table 2.13 is that districts
from Pemba outperform districts in Unguja. This reversal of fortune (as compared to the gross
enrolment ratio) is very significant; Micheweni which has the worse gross enrolment ratio has the
highest pass rate at 84.5 percent. The pass rate in Pemba ranges from 67 to 84, while the pass rates in
Unguja is below 50 percent except for one district of Kusini.
Table 2.13: Transition rate Form 2 to Form 3 by district (Form Two Examination Pass Rates In
Percentage)
DISTRICT
Mjini
Magharibi
Kaskazini A
Kaskazini B
Kati
Kusini
Micheweni
Wete
Chake
Chake
Mkoani
TOTAL
Boys
34.7
33.4
47.3
57.4
51.1
59.1
50.8
49.0
59.1
2004
Girls
39.5
34.6
36.1
52.3
51.5
59.9
42.2
44.2
46.2
Total
37.0
34.0
41.1
54.7
51.3
59.4
47.6
46.5
52.4
45.4
44.4
44.2
42.4
44.8
43.4
Boys
48.4
44.6
49.1
37.1
43.2
37.0
58.8
50.2
54.7
2005
Girls
55.0
47.9
34.7
37.3
44.7
52.1
40.8
44.6
58.5
Total
51.8
46.5
41.5
37.2
43.9
43.9
50.3
47.3
56.7
42.9
47.0
36.4
46.8
39.6
46.9
2006
Boys Girls
50.5 49.1
49.2 47.8
38.8 23.5
44.3 29.8
40.9 41.7
40.7 38.6
69.2 55.3
53.1 53.8
70.1 66.3
78.7
53.5
69.8
48.0
Total
49.8
48.4
29.6
35.8
41.3
39.7
62.6
53.5
68.2
Boys
43.4
52.7
50.8
47.3
40.3
32.9
67.4
62.7
55.1
2007
Girls
49.0
52.7
36.6
35.0
42.4
34.0
62.3
63.6
56.6
74.0
50.6
57.5
51.4
60.9
50.5
Total
46.2
52.7
42.8
40.6
41.3
33.4
65.0
63.1
55.8
59.2
50.9
Boys
40.8
42.8
51.8
40.4
43.2
53.4
87.0
67.8
72.2
2008
Girls
49.5
45.5
40.5
38.2
53.6
53.4
82.0
73.5
63.8
Total
45.5
44.3
44.5
39.1
48.8
53.4
84.5
70.8
67.3
71.5
53.1
72.8
54.5
72.2
53.9
Source: MoEVT
This confounding conflict between achievements in gross enrolment ratio against the pass rates needs
further exploration, which may require a separate full study. Figure 2.3 indicates that there is a general
but not a perfect negative correlation between gross enrolment ratio of a district and the pass rate of the
district. This suggests some possible explanations for the confounding relationship between pass rates
and gross enrolment rate.
_______________________________________________________________________________ 39
60
80
100
120
140
Figure 2.3: Observed GER against Predicted GER
40
50
60
70
80
90
PASS
Observed GER
Fitted Gross Enrolment Ratio
One of the explanations could be that pupils who sit for form two examinations in districts with low gross
enrolment rate are the ones who did not drop out of school precisely because of their commitment to
education, and that those not committed to education would have dropped out before the examination.
In econometrics terms such pupils are said to have self-selected themselves on the basis of their
attribute of dedication to education. As for districts with high enrolment rate it might be that both those
pupils with minimal commitment to education and those with high dedications to school continues with
their studies and sit for Form 2 examinations. As a result the percentage of those who pass the
examination out of all those who sat for examination may be lower than in districts with low gross
enrolment ratios. If this explanation captures the reality we would see that total enrolment by
grade/class would be declining for the districts with better transition rate than in the districts with lower
transition rate. Figure 2.4 depicts the trend of enrolment ratio by grade/class.
_______________________________________________________________________________ 40
Number of Students
Figure 2.4: Trend in the Enrolment Rate by Class/Grade and by District
9000
8000
7000
STD 1
6000
5000
4000
3000
STD 2
STD 3
STD 4
STD 5
2000
1000
0
STD 6
STD 7
KA
TI
KU
S
M
IC
HE
W
ET
E
CH
AK
E
M
KO
M
JI
N
M I
AG
H
KA
S
'A
KA '
S
'B
'
FORM I
FORM 2
Districts
The districts of Mjini and Magharibi show that enrolment has been increasing sharply at Form 2.
Micheweni however shows that enrolment has been progressively declining from standard one on to
Form 2. Overall there is a general attrition from standard one to Form 2, but it seems that this is more
pronounced in Micheweni than in other districts. It is therefore possible that attrition explain to some
measures the good transition rate of pupils in Micheweni. Of course it is also known that parents in
Pemba take special interest in the preparation of examination for their children and exert extra effort to
ensure that pupils who are to sit for examination get to camp together to ensure that they intensely
focus on preparation of examination.
It is also important to assess the quality of education by district, but this is overly tricky. However,
several parameters can highlight the quality of education that is offered. One such indicator is the
number of pupil per class. Obviously a very large class makes it impossible for the teacher to give
sufficient attention to each pupil. Table 2.14 gives trends in the class pupil ratios by districts for the
years 2003, 2005 and 2008. Overall the average Class Pupil Ratio for Zanzibar has been declining,
which is a sign of progress. Micheweni is the only district that registered deterioration in the Class Pupil
Ratio. This deterioration however, might have been due to an increase in school attendance in
Micheweni, which hitherto was not very good. In any case by 2008, the districts in Pemba have Class
Pupils Ratio that is above the average of 68.5 for the whole Zanzibar, signifying that in this score
Pemba is doing worse than Unguja. This of course compounds the puzzle of why schools in Pemba
seem to be doing far better than schools in Unguja in terms of transitional rate to form three.
_______________________________________________________________________________ 41
Table 2.14: Class Pupil Ratios by District
District
2003
Mjini
80
Magharibi
91
Kaskazini A
98
Kaskazini B
96
Kati
64
Kusini
46
Micheweni
76
Wete
87
Chake Chake
87
Mkoani
82
AVERAGE
81
Source: MoEVT
2005
75.2
79.4
83
85
51.2
38.7
78.8
81.3
83.9
81.7
74.1
2008
66.9
78.7
65.8
64.4
47.9
38.5
92.9
73.9
74.4
71.9
68.5
Table 2.15 gives the figures of the number of students enrolled at the Universities located in Zanzibar
from 2004 to 2008. This figure should not be confused with the number of Zanzibaris pursuing
university education during this period. It is not yet possible to get with precision the number of
Zanzibaris who are pursuing university education at any given time. Moreover, enrolment at the three
universities in Zanzibar includes a significant number of students from Tanzania Mainland and from
abroad. However, enrolment at the local universities in Zanzibar can be taken as a proxy for the
existing capacity for offering university education. Between 2004 and 2008 total enrolment at the local
universities increased by more than two folds.
Table 2.15: Enrolment into Universities in Zanzibar
Institute
State
University of
Zanzibar –
SUZA
Zanzibar
Unuversity
College
University of
Chukwani
Male
2004
Female
Total
Male
2005
Female
Total
Male
2006
Female
Total
137
103
240
170
141
311
250
191
154
82
236
86
43
129
251
381
329
200
529
Total
291
857
585
384
969
185
Total
Male
2008
Female
Total
441
419
348
222
570
90
341
1413
1017
697
1714
319
220
539
571
409
217
626
820
501
1321
2403
1774
1136
2910
Male
-
2007
Female
-
Source: MoEVT
Expansion of education as reflected by the gross enrolment ratio for basic education and the enrolment
at the local universities is one thing, ensuring high standards of education is another thing. One of the
most important ingredients for good education is the quality of teachers. In particular, the quality of
teachers that offer basic education has profound influence over the quality of the entire education
system. Table 2.16 gives figures of the number of trained teachers (with at least certificate in education)
_______________________________________________________________________________ 42
with their highest level of education attained. About 91 percent of teachers in Zanzibar are trained. This
is a very good achievement. However, more than 50 percent of teachers went only up to Form 4 before
they were trained as teachers. There are a number of teachers in secondary schools with certificate
level of education as their highest education prior to being trained as teachers. This has a negative
impact on the quality of education.
Table 2.16: Level of Education and the Percentage of Trained Teachers by Districts
WILAYA
QORAN
FORM 3
TR
FORM 6
FTC
ISLAMIC
DEGREE
TR
TR
UT
UT
TOTAL
TR
UT
TR
UT
TR
UT
TR
UT
TR
TR
UT
0
0
48
2
993
100
23
33
1
11
330
0
416
0
187
1
1998
147
Magharibi
0
0
50
3
1205
101
25
42
0
11
303
0
421
0
128
0
2132
157
Kaskazini 'A'
0
0
17
6
400
77
17
33
2
6
160
0
188
0
20
0
804
122
Kaskazini 'B'
0
0
12
5
310
48
1
31
0
3
85
0
119
0
9
0
536
87
Kati
0
0
5
1
503
50
15
13
4
5
99
0
160
0
20
0
806
69
Kusini
0
0
0
0
203
15
4
2
0
0
83
0
64
0
9
0
363
17
Micheweni
0
1
49
0
210
24
7
8
0
0
36
0
75
0
21
0
398
33
Wete
1
2
71
9
454
36
11
14
0
1
47
0
169
0
34
0
787
62
ChakeChake
Mkoani
0
0
28
37
398
68
25
14
3
1
42
0
137
0
32
0
665
120
1
5
57
7
240
36
9
2
0
0
83
0
30
0
0
0
420
50
2
8
337
70
4916
555
137
192
10
38
1268
0
1779
0
460
1
8909
864
0.0
0.1
3.4
0.7
50.3
5.7
1.4
2.0
0.1
0.4
13.0
0.0
18.2
0.0
4.7
0.0
91.2
8.8
Percentages
UT
DIPLOMA
Mjini
TOTAL
UT
FORM 4
TR=Teachers with training in education, UT, Teachers without any training in education Source: Ministry of Education and Vocational Training
Budget speech (2008/2009). Source: MoEVT
Table 2.17 gives an indication of literacy rate in Zanzibar using the 2004/5 Household Budget Survey
data. About 75.8 percent of the population aged 15 years or above could read and write at least in
Kiswahili in 2004/2005. This indicates that illiteracy rate in 2004/5 was about 24.4 percent. There has
been progressive improvement in the literacy rate over time. In 1986 illiteracy rate was 39 percent. The
2002 Housing and Population Census shows that illiteracy in Zanzibar had then been reduced to 26.6.
The MDG goal of eliminating illiteracy by 2015 remains challenging but not completely out of reach.
_______________________________________________________________________________ 43
Table 2.17: Adult Literacy and by District
District
Literacy Rate
Kaskazini A
57
Kaskazini B
66.7
Kati
80.4
Kusini
83.7
Magharibi
87.8
Mjini
90.7
Wete
66.9
Micheweni
46
Chake Chake
69.4
Mkoani
64.6
OVERALL
75.8
Source: Household Budget Survey Report 2004/2005
Goal number two of the Millennium Development Goal relates to the universal primary education; it
aspires to achieve universal primary education by 2015. Significant progress has been made in
expanding basic education enrolment since the adoption and commitment to the Jomtien Declaration
on Education for All (EFA); the development and implementation of the Zanzibar Education Master Plan
(1996-2006), the current Zanzibar Education Policy (2006) and commitment to the realization of the
Millennium Development Goals (MDGs). The challenges are related to all three main components in
education which are access, equity and quality of education. These challenges include:
Acute shortage of classrooms which results to
o Overcrowding of children in the classroom
o Disparity in enrolment and completion rates between the districts as well as urban and
rural.
o Children are not enrolled at the right age.

Poor planning of school location creates disparity between and within districts.

The majority of children enter primary education at the age of 7 and above. This results to most
classes having children of mixed ages and abilities making the delivery of education difficult.

The highest wastage rate in basic education cycle especial in rural districts, this is mainly
caused by a number of reasons:o Children of school going age engage in seasonal activities such as fishing and clove
picking instead of attending school and therefore contributing much to school
absenteeism.
o Incidences of pregnancies, early marriages and traditional culture.
_______________________________________________________________________________ 44

The quality of basic education is generally described as not satisfactory. Evidence tends to
suggest that overall performance by students is poor, especially in Science and Mathematics
subjects. This poor quality of education is explained by a number of factors, these include:o Poor service delivery.
o Low system financing
The Millennium Development Goal further aspires to eliminate gender disparity in primary
and secondary education, preferably by 2005, and in all levels of education no later than
2015. Zanzibar is on course to achieving gender parity in pre-school, basic education and
secondary education levels.
2.6
Gender Parity
Women constitutes about half of the population of Zanzibar. Arrangements that promote the welfare of
women would therefore have significant impact. Zanzibar, like any other country in the world, is
characterized by gender disparity in economic affairs and political participation. This section makes a
brief review of the gender imbalance in Zanzibar.
Table 2.18 reports distribution of employment and earning by sector of employment by gender. Men
occupy 60 percent of all employment in spite of the fact that they make up only about 50 percent of the
population.
Table 2.18: Employment and Earnings by Sector and Sector, 2007
Sector
Employment
Males
Government
16,845
Parastatal
3,808
Private
6,064
Total
26,717
Source: OCGS; Statistical Abstract, 2008 (extracts from several tables)
Females
12,717
867
2,896
16,480
Statistics on shares of representation by gender into executive positions in private sectors remain
scanty. The only information readily available pertains to the public sector and in particular on members
of the House of Representatives, the Council of Ministers and few Senior Government positions. The
relative shares of women are shown in Table 2.19.
_______________________________________________________________________________ 45
Table 2.19: Representation of Women in Decision Making Bodies, 2007
POST
Ministers and deputy ministers
Principal secretaries and deputy PSs
Regional and district Commissioners
Members of the House of Representatives
Both Sexes
19
22
15
77
GENDER
Female
4
3
2
18
FEMALES
SHARES
21.1
13.6
13.3
23.4
Source: Zanzibar Revolutionary Council; House of Representatives; Zanzibar
Out of 19 ministers and deputy ministers only 4 are female. Further, out of 22 principal secretaries and
deputy principal secretaries, only 3 are female, which is 13.6 percent of all. Zanzibar has a total of 15
regional and district commissioners, but only 2 of them are females. Finally, of 77 members of the
House of Representatives (the Parliament), the number of female is 18. Even then four fifth of the
females who are members of the House of Representative did not get there through contesting and
winning a constituent; most of them are either nominated by the President of Zanzibar or are nominated
through special seats by their political parties.
There is only one Municipal Council in Zanzibar which caters for Zanzibar Town. Councillors are
elected by popular votes. Thirty percentages of the number of elected seats in the Municipal Council
are reserved for women. Women in this reserve seats are nominated rather than being elected. Of the
twenty councillors who had to contest for their position through election there is only one woman. The
Minister has powers to nominate three councillors, the power of which he has used to nominate two
males and one female; apparently the minister did not see the need to use this power to redress the
gender imbalance in the council, presumably because of the fact that 6 seats have already been
reserved for women. Nevertheless, even with this deliberate policy of expanding the seats for women,
there still remains a huge gender imbalance.
Town Councils in Pemba also display huge gender imbalance. All 21 elected seats in the town councils
in Pemba are occupied by men. The Minister used his power to nominate 6 males to the Town
Councils- no woman is nominated in this category. Thus of the 33 Councillors in the Town Councils,
only six are women.
_______________________________________________________________________________ 46
Table 2.20: The Number of Shehas and Councillors by Gender and Districts
District
Mjini
Magharibi
Kaskazini A
Kaskazini B
Kati
Kusini
Total Unguja
Chake Chake TC
Chake Chake DC
Mkoani TC
Mkoani DC
Wete TC
Wete DC
Micheweni
Total Pemba
Grand Total
Male
45
40
35
28
38
20
206
SHEHAS
Female
4
1
1
2
8
Total
45
44
36
29
40
20
214
29
-
29
31
2
33
29
23
3
4
32
27
112
318
9
17
121
335
CONCILLOR
Male Female
20
9
14
5
12
4
10
5
10
5
10
5
76
33
9
3
10
3
10
3
10
3
10
3
10
3
10
3
69
145
21
54
Total
29
19
16
15
15
15
109
12
13
13
13
13
13
13
90
199
Source: Regional Administration
A critical mass of educated women is necessary for creating a pool of women with interest in contesting
political post needed to generate sufficient number of them to contest political posts and to take up
executive positions in the government and private sector. Gross enrolment ratio for female is not low,
and in some cases it is higher than male gross enrolment. The only level to which women are
significantly outperformed in terms of gross enrolment ratio is at the tertiary level of education. Table
2.21 below gives a ratio of male to female in the enrolment to primary education from 2003 to 2007.
There is hardly any significant disparity in enrolment in the basic education.
Table 2 21: Basic Education: Gender Parity Index (Boys/Girls) STD I to FORM II
DISTRICT
Urban
West
North A
North B
Central
South
Micheweni
Wete
Chake Chake
Mkoani
TOTAL
2003
1.04
1.06
0.97
0.95
0.95
0.92
0.87
0.95
0.95
0.95
0.98
2004
0.96
0.93
1.01
1.04
1.07
1.07
1.18
1.03
1.04
1.05
1.01
2005
0.95
0.92
0.99
1.00
1.06
1.08
1.12
1.05
1.03
1.07
1.00
2006
0.94
0.93
0.94
0.98
1.04
1.08
1.31
1.05
1.02
1.05
1.00
2007
0.94
0.92
0.77
0.89
0.98
1.06
1.11
1.05
0.93
1.08
0.96
2008
0.93
0.92
0.94
0.95
1.05
1.05
1.06
1.03
0.99
1.04
0.98
Source: MoEVT
_______________________________________________________________________________ 47
Apart from education, cultural and historical factors account to the gender disparity in the world.
Interventions such as the appointment of female members of the House of Representative are therefore
useful for not only correcting the existing imbalance, but for creating role models for girls and fostering
social acceptance of women in the roles that are still traditionally a preserve of males.
2.7
Water
The last dimension of human development that this report looks at is the access and the utilization of
water. Water is one of the essentials for life both for consumption and for the preparations of food.
Water also makes it possible to maintain cleanness and improve sanitation. In fact evidence shows that
access to safe water and good sanitation contributes significantly to reducing child mortality (Abou-Ali
2003). Lack of easy access to water creates a host of problems to households. First, time is wasted
walking distances to fetch water. In most cases it is the girls in the household who are sent out to fetch
water and thus spending valuable time that could have been used for studying. Table 2.22 reports the
proportion of people with access to safe and clean water in Zanzibar by regions from 2003 to 2008. The
Table shows that there has been a progressive increase in the number of households connected to
safe and clean water.
Table 2.22: Proportion of People with Access to safe and Clean Water by Region, 2003 – 2008
REGION
2003
2004
2005
2006
2007
2008
Kaskazini Unguja
11.0
75.0
71.0
96.5
96.5
96.5
Kusini Unguja
29.0
70.0
78.0
90.3
90.3
90.3
Mjini Magharibi
60.0
75.0
75.0
95.7
95.7
95.7
Kaskazini Pemba
72.0
75.0
80.0
68.7
68.7
68.7
Kusini Pemba
72.0
75.0
80.0
72.5
72.5
72.5
Source: Department of Water
2.8
Conclusion and Some Policy Issues
This chapter review the human development situation in Zanzibar by assessing trends and offer a
baseline for future assessment. Four dimensions of human development, namely, income, health
(including life expectancy), knowledge and gender have been assessed.
The chapter shows that Zanzibar has enjoyed positive economic growth since 1991; this growth
accelerated in the 2000s. Chapter three would explore this issue further. The chapter shows that there
is some significant disparity across districts in the levels of the mean household consumption.
Micheweni and Wete have the lowest mean per capita consumption. Mjini district has the highest. In
any case the overall mean per capita consumption is very low. Zanzibar therefore remains very poor.
Issues of poverty and income distribution would be explored further in chapter four of this report.
_______________________________________________________________________________ 48
In terms of health status this chapter focuses on nutritional status of children, the mortality rate of
children, morbidity and the distribution of health facilities across districts. Various measures of nutrition,
namely stunting, underweight and height per age indicate that a lot remains to be done to improve
nutrition of children in Zanzibar. However, Zanzibar is on balance doing much better than Tanzania
Mainland in these scores and in terms of Millennium Development Goals, Zanzibar is on track to
attaining the nutritional related MDG.
There is no significant disparity in the distribution of health facilities across districts in Zanzibar.
However, this chapter shows that private health facilities are overwhelmingly located in two districts of
Zanzibar town, namely Mjini and Magharibi. The two districts have the highest per capital income than
any other district in Zanzibar-signifying that on average, households in these two districts have higher
income than households in the rest of the districts. The latest Household Budget Survey indicates that
the two districts of Mjini and Magharibi have the least number of people who reported to have fallen sick
or suffered injuries. All these indicate that private health facilities are attracted to districts with higher
income, not districts with the most need of medical attention. This obvious fact buttresses the need for
the government to continue to play key role in the provision of health facilities in Zanzibar.
In terms of education, Zanzibar has an impressive overall gross enrolment ratio, although this is only
because of high enrolment at the primary and secondary levels. Much still needs to be done to expand
enrolment at the tertiary level of education. It is encouraging that intake of the Universities located in
Zanzibar is increasing at an impressive rate.
Another critical issue is the level of education of teachers. While the Revolutionary Government of
Zanzibar has done a very commendable job of training teachers there is a need to ensure that the level
of education of teachers is sufficiently high.
Lastly, gender imbalance is a problem in Zanzibar just as it is in every country in the world. It is
encouraging that there are higher school enrolment ratios for females than for males at the primary and
secondary levels, but tertiary level of education exhibit a bias against females. There is still insignificant
representation of females in key decision making bodies. Measures to correct gender imbalance needs
to be rigorously promoted and implemented.
_______________________________________________________________________________ 49
CHAPTER 3: NATIONAL INCOME GROWTH AND DISTRIBUTION
3.1
Overview
The status of human development for Zanzibar given in the previous chapter has indicated modest
progress in some areas and highlighted areas that need improvement. This chapter explores the
economic base upon which human development evolves. The chapter provides a characterization of
the growth patterns of the economy nationally and sectorally, and relate them to issues of income
distribution and poverty trends. The objective of the chapter is to assess growth pattern across sector
and associate the sectors’ performance with the levels and changes in employment and household
incomes (especially returns to labour). This assessment is complemented with scenario analysis that
links GDP (from the national accounts) and HBS data points so as to project the likely path of poverty
reduction since the last household budget survey was collected in 2004/2005.
The rest of the chapter is organized as follows. Section 3.2 provides overview of the overall growth of
the Zanzibar's economy, measured by GDP. Section 3.3 presents a discussion of the sectoral growth
patterns. Section 3.4 explores the links between growth and employment. These links are measured in
terms of employment elasticity of growth. Section 3.5 simulates the path of poverty levels in Zanzibar
since the last HBS. Section 3.6 summarizes and caste policy messages.
3.2
Growth Pattern at Macro-Level
Presently the economy of Zanzibar is flourishing following years of continued stagnations in the 1980s
and early 1990s. The recent trends in macroeconomic performance are driven by a composite of
policies set to lift the overall growth of the economy to 10 percent par annum. Some of these policies
are (or were) enshrined in the Zanzibar Vision 2020, Zanzibar Poverty Reduction Plan (ZPRP),
Zanzibar Strategy for Growth and Reduction of Poverty (ZSGRP), The Zanzibar Growth Strategy, and
sector policies.
Figure 1 shows the trend in real GDP at 2001 prices and the associated real growth. In a country,
where the population growth is three percent per annum, it is certainly that a considerable per capita
income has been registered in the past six years (since 2002). The estimated growth rate averages
around 6 percent over those years. During this period, GDP per capita (in current UD$) almost doubled
from $276 in 2002 to $534 in 20082.
2 Ideally, to allow cross-country comparison or the absolute poverty line of a dollar per day, income per capita has to be
expressed in Purchasing Power Parity. However, we could not find such a series for Zanzibar.
_______________________________________________________________________________ 50
Figure 3.1: Trend in Zanzibar's GDP between 2002 and 2008
9
8.6
338.9
302.6
300
8
7
250
6.5
241.4
%
(million) Tsh
350
6.3
6
5.4
200
4.9
150
5
4
2002
2003
2004
2005
GDP_2001_Prices (million)
2006
2007
2008
GDP_Growth (%)
Source: Computed from Growth Pattern and Distribution. Background paper to ZHDR 2009, May 2009.
Indeed, such level of growth is impressive historically and when comparison is made between Zanzibar
and other countries in the region. However, when subjected to a wider perspective, it quickly becomes
evident that more efforts are needed to speed up the growth process. Cross-country growth
experiences summarized in CGW (2008) shows that successful takeoff can only be achieved if a
country can sustain a growth rate of at least 7 percent per annum for a successive 25 year period.3
Gauged in this yardstick, the situation in Zanzibar becomes less optimistic due to the circular downward
trend portrayed in Figure 3.1. Thus, immediate efforts in various fronts to support and sustain growth
are needed to reverse (or at least halt) this. And these efforts are already in place – but their actual
fruitions are still at bay. Those efforts, and their output indicators, are summarized in several other
reports on Zanzibar, including MKUZA Annual Implementation Report 2008 and Zanzibar MDG
Reports.
Commission on Growth and Development (“The Growth Report: Strategies for Sustained Growth and Inclusive
Development” 2008) defines successful growth as a sustained economic growth rate of least a 7 percent over 25 years or
more.
3
_______________________________________________________________________________ 51
Box 3.1. Trends in per capita GDP in Zanzibar
Zanzibar is characterized by a fairly high population growth rate of 3.1 percent, which
significantly reduces the impact growth may have in the economy and on poverty
reduction. In recent years the capita income for Zanzibar has been ranging from Tshs
261,000 (USD 251) in 2002 to Tshs. 368,000 (USD 327) in 2005 up to Tshs 639,000
(USD 534) by end of 2008. However, the USD 534 per year (equivalent to USD1.5 per
day but not in the PPP) for every Zanzibari is rather low for human survival.
Nevertheless distribution is what matters most in terms of what proportion of the
population gets what percent of the overall output in the economy. Issues of distribution
will be handled in subsequent sections of this chapter.
Despite these efforts, policy makers and all other development practitioners in Zanzibar will continue to
face several challenges associated with GDP growth pattern. Among the challenges include cyclic GDP
growth rates, which is closely association with the performance of the agriculture sector. Zanzibar's
agriculture is largely rain-fed. Due to its share in GDP and forward and backward linkage it has with
other sectors of the economy, whatever happens to agriculture directly affects GDP growth.
The fluctuations of agricultural sector performance have two sources – fluctuation in output and
fluctuation in prices, especially of the export crops. As a result of reliance on exports of such crops like
clove, trade account is consistently in deficit. The export of services – mainly tourism, is picking up but
has not reached a level high enough to offset the influence of the fluctuation of agricultural sector has
on the economy.
Another variable likely to pose significant challenges is the rising inflation rate. The triggers of the
current inflationary spiral were, among others, the increases in food and oil prices in the world market.
These sources have almost disappeared, but their effects still linger and likely to remain noticeable in
the near future. However, the experiences from other counties show that the current level of inflation in
Zanzibar is within a tolerable range. Other countries have managed to grow and reduce poverty with
inflation rate higher than that currently recorded in Zanzibar. Angola has been growing at a world
record level with inflation above 10 percent per year. Mozambique had double digit level of inflation in
the early 2000s and still recorded remarkable growth. Thus, what is critical and most formidable for
growth is the right policy mix that can spur investment – both domestic and foreign. But this does not
mean that the (re)distributional effects that relatively higher rates of inflation may have to the Zanzibari
should be ignored.
_______________________________________________________________________________ 52
Box 3.2. Inflation trends in Zanzibar
Despite Zanzibar’s improved macroeconomic performance, inflationary
pressure in recent years has raised concerns about macroeconomic instability
and this remains a challenge for human development. From 2002 to 2008,
annual inflation has been increasing as a result of an increase in food prices. The
trend has been seen to increase from 5.2 percent in 2002 to 9.7 percent in 2005
and recently to 20.6 percent in 2008. The trend has been seen to decline slightly
recording 12.5 percent in April 2009.
3.3
Sectoral Patterns of Growth
The Zanzibar's national accounts categorizes the economy into three major sectors, namely (i)
agriculture and natural resources, (ii) economic sectors, and (iii) service sectors. The first category is
composed of crops sub-sector, livestock, forestry, and fishery. The economic sector is made up of
quarrying, industrial products, water and power, and construction. The service sector is probably the
broadest category, comprising administrative, civil and commercial services. For the purpose of this
chapter, our analysis will be limited to these three broad categories. The information that we analyze in
this section is summarized in Table 3.1.
The analysis shows that the agriculture and natural resource sectors (fishing and forestry) have been
growing at about average rate of 5 percent per annum since 2002. During this period, major
contributions to the sectoral growth come from the crop sub-sector. An analysis of longer-run trends
shows that the average growth of the sector over the past 18 years has been about 4.5 percent per
annum. Thus, the recent increase has been a result of government effort in reforming the agriculture
sector through introducing irrigation system, empowering the farmers and use of modern techniques of
farming. Since most of the agriculture is rain-fed, favourable weather conditions in recent years partly
explain this growth. However, a world market price of clove has not been good. The effect of increase
growth in the agriculture has been reflected in more or less a constant share of the sector in the overall
GDP (as shown in section A of Table 3.1). Development dynamics elsewhere shows that the share of
the agricultural sector in the national economy tends to decline as the country progresses.
The sector that had witnessed huge strides in the growth rate during this period is the 'economic sector'
– growing at about 8 percent per annum. The service sector has also been growing at a modest rate –
at a rate of about 5 percent per annum since 2002. It is apparent that the service sector, which
includes sub-sectors related to tourism activities, did not have exceptionally impressive growth4.
4 In 2004, tourism grew by double digits – 11.5 percent and in 2005, by 39.9 percent. Since then, the growth rate is on the
declining trend. The global economic crisis continues to affect the sector – growth rate estimated at -0.5 percent in 2008.
_______________________________________________________________________________ 53
Behind these period averages, the annual pattern of growth and sources of growth portrayed in Table
3.1 shows very high level of volatility. As a rough indicator of this variability, it is noted that the standard
deviation of the growth rate of the agricultural sector was 1.5 times the mean growth rate since 20025.
That of the service sector was 2.2. Indeed, much more variability is expected in sub-sectors
(components of the three major sectors analyzed) because effects of averaging tends to dampen these
variability during aggregation.
Table 3.1: Decomposition of GDP Growth into Sectoral Growth in Zanzibar (in percent)
A Sectoral Share
AGRICULTURE, FORESTRY & FISHING
ECONOMIC SECTOR
SERVICE SECTORS
Adjustment to prices
TOTAL GDP
B Sectoral Growth
ECONOMIC SECTOR
SERVICE SECTORS
Tax Charges
TOTAL GDP
C Sectoral contribution to growth
ECONOMIC SECTOR
SERVICE SECTORS
Tax Charges
TOTAL GDP
2003
22.7
12.7
49.0
15.6
100
2004
21.9
13.5
49.0
15.6
100
2005
21.5
13.7
49.2
15.6
100
2006
24.0
15.2
45.2
15.6
100
2007
22.5
15.0
46.9
15.6
100
2008
22.6
14.4
47.4
15.6
100
2.8
12.6
6.7
6.5
6.5
2.9
6.5
5.2
4.7
4.8
18.6
17.6
-2.8
6.1
6.0
-0.4
4.8
10.4
6.1
6.3
5.8
1.5
6.4
5.4
5.4
9.6
24.6
50.3
15.6
100
13.0
18.3
53.4
15.3
100
66.7
40.4
-22.8
15.8
100
-1.6
11.6
74.7
15.3
100
24.4
4.1
55.8
15.7
100
Source: Zanzibar Economic Survey, May 2009
The variability in sectoral growth indicates correspondingly high rate of vulnerability of households
whose livelihoods depend on these sectors. Such variability implies that summary measures of single
waves of HBS may conceal the actual poverty and vulnerability levels in Zanzibar. A longitudinal HBS
surveys are thus needed to reveal the dynamics of poverty which single wave of HBS fails to uncover.
Variability in sectoral output has implications not only on the livelihoods of the households but on the
macro stability of the entire country. The macro implications of this variability are apparent from the
analysis of the sectoral contribution to overall growth of the economy (see section C of Figure 3.1). The
service sector, which on average contributes 42 percent to the overall growth have substantial
subtraction from growth in 2006. Mild subtraction from growth also came from agriculture in 2007.
5 This ratio is what is referred to as the coefficient of variation in statistics.
_______________________________________________________________________________ 54
3.4
Patterns of Growth and Pro-poor Employment
In the previous section, the focus has been on characterising growth pattern in terms of their rates and
shares. The section also made a link of the variability of this pattern to vulnerability of households and
instability of the economy. This section focuses on linking growth and employment (see appendix B at
the end of this report for the analytical framework used). The assumption is that robust and sustainable
pro-poor growth should be the growth that generates decent jobs.
In this analysis, the starting point is again the growth accounting of the previous sections, matched with
employment data. Specifically, the analysis takes a look into what sectors/occupation absorbs which
proportion of the labour force and associate these ratios to growth in the national accounts or other
indicators of growth. Where data allows, the analysis is carried at gender and age group levels. It
should be noted that, most of the employment referred in this section is the direct employment – (and
not indirect employment, say through the multiplier effects).
Ideally, a long enough series is required for robust estimates. In the absence of such a series, we are
forced to use only two years period – 2007 and 2009 for income data and financial years – 2006/07 and
2007/08 for the employment data. The results of this analysis are summarized in Table 3.2. Extreme
estimates of elasticity in Table 3.2 reflect the problem of short reference period. Thus, the results
should be interpreted with caution. In any case the result will establish a base for future studies.
Generally, the results in Table 3.2 paint an optimistic picture. The overall responsive of employment to
growth is relatively high for the private sector – every percentage growth in income is associated with
three percent increase in the number of employees in the private sector. There is no matched effect on
the public sector. Even though the economy grew at 5.4 percent in the reference period, employment
in the public sector declined marginally. The decline is difficult to explain even though the increase is
not expected because employment policy in the public sector is usually rigid relative to the private
sector. The analysis of the parastatals shows similar picture to that of the public sector. The estimated
elasticity in the parastatal sector is negative five, probably reflecting the decline importance of the
parastatals in the reformed Zanzibar.
_______________________________________________________________________________ 55
Table 3.2: Employment elasticity of growth in Zanzibar in between 2007 and 2008
Sector/Employer
Agriculture, forestry & fishing
Mining and Quarrying
Manufacturing
Construction
Hotels and Restaurants
National estimates
Income
growth
22.8
-0.2
0.5
-0.5
5.4
Government
Male
Female
-2.2
197.4
-4.7
88.6
-1.1
-4.4
31.6
-16.8
48.0
0.4
All
0.1
-2.2
129.5
-6.1
69.9
-0.5
Male
-1.8
-1.9
-484.2
-2.2
-6.9
2.6
Private
Female
-1.2
-2.2
-1310.8
1053.3
-50.3
3.4
All
-1.5
-2.0
-563.5
145.8
-20.5
2.8
Source: Computed from Table 4.43, Table 4.47, and Table 3.5 of the Zanzibar's Economic Survey, May 2009
For growth to be pro-poor, it has to create decent jobs. In this analysis, decent jobs are measured by
increase in per capita employee cash income in relation to the growth of the economy. The analysis
shows that nominal per capita cash earning increased by 40 percent for government employees. Given
the rate of inflation of around 10 percent, this shows that real pay improved significantly. Furthermore,
the per capita nominal pay to the employees of the private sector increased by 94 percent. This again
represented a substantial increase in real terms under the assumption of distribution neutral growth.
Box 3.3. Per capita cash payment of employees in the private sector
vs. poverty line in Zanzibar
Average monthly cash pay (including other cash benefits) of a
government employee was TZS 97,839 in 2006/07 and 137,335 in
2007/08. The figures for an employee of the private sector are TZS
55,952 and TZS 108,708, respectively. This indicates that private sector
pay, on average, increased faster than the government pay. In a society
of average household size of 4 (a conservative number, the 2002 census
figure is 5.2) and if only one member of the household works, then
each person will be living below a dollar per day. Many similar
conclusions can be made based on the table below (assuming annual
rate of inflation of about 10 percent).
Per capita cash pay
(Public)
Per capita cash pay
(Private)
FY 2006/7
FY 2007/08
24,460
34,334
Basic needs
20,185
27,177
Food
12,573
13,988
Poverty line in
2004/05
_______________________________________________________________________________ 56
3.5
Predicting Poverty Path from the Growth Pattern
With a low pay per work analyzed above and the per capita GDP discussed in earlier sections, it can be
concluded that a significant proportion of Zanzibaris are still living under poverty. The variability of their
income sources, thus vulnerability, has also been inferred from wild fluctuation in some sectoral
incomes. This section builds on the results of previous sections by analysing various scenarios of
poverty reduction path in 2000s. Years that recorded sharp changes in poverty trends are examined in
relation to what sector were the major growth driver.
The analysis follows the approach proposed by Datt, et al. (2003)6. The approach has been use for
Mainland Tanzania by Demombynes and Hoogeveen (2007) and Mduma (2007)7 . This approach
combines national accounts data and data points in HBS and simulates the poverty path based on the
growth trends as reported in national accounts. The approach allows the use of different assumptions,
e.g. on the changes in the distribution of income and locations where growth might have concentrated.
In that case, the analysis is able to show the extent growth can be pro-poor and under what (plausible)
assumptions. The results of this analysis are as follows:
3.5.1 Poverty Trends under the Assumption of Distributional Neutral Growth
Under the assumption that growth has been distributionally neutral (i.e. there is no change in
inequality), Zanzibar may have removed about 10 percent of its people out of poverty (Figure 3.2). This
is about a 19 percent decline in poverty level recorded in the survey year of 2004/05. Cumulative
growth in per capita GDP over this period is about 24 percent. With such predicted decline in the level
of poverty, this growth results in poverty elasticity of growth of about 0.79.
Figure 3.2 also shows that there may be significant decline in poverty gap – a decline of 26 percent.
Again, relative to cumulative growth in GDP, a poverty elasticity of growth is about 1. The analysis also
shows that poverty severity may have decline substantially – by about 30 percent.
The period that was associated with largest decline in poverty is 2006 to 2007. Between these two
years, GDP attained the highest growth rate in the review period. It can be noted from Table 3.1 that in
2006 – 2007, the share and growth rate of agriculture declined. At the same time, the share of service
sector increased and about 75 percent of the growth came from the service sector.
See Datt, G., et al. ,2003. “Predicting the effect of aggregate growth on poverty,” in F. Bourguignon and L. Pereira da Silva
(eds), The Impact of Economic Policies on Poverty and Income Distribution: Evaluation Techniques and Tools, The World
Bank and Oxford University Press.
7 Demombynes, G. and J.G. Hoogeveen 2007. "Growth, inequality, and simulated poverty paths for Tanzania, 1992-2002,"
Journal of African Economies 16: 596-628. Mduma JK. 2007. Did poverty really decline since 2000/01? World Bank Policy
Note – Dar es Salaam.
6
_______________________________________________________________________________ 57
Figure 3.2: Simulated Poverty Levels in Zanzibar since 2004
P0
P1
49%
13.1
47%
12.4
45%
11.5
42%
10.4
40%
2004
2005
2006
2007
2008
9.7
2004
2005
2006
2007
2008
Source: Computed based on Zanzibar HBS Dataset and Zanzibar National Accounts – Economic Survey, May 2009.
3.5.2 Poverty Trends under Different Assumptions on Inequality
The analysis of the previous section shows that poverty might have declined substantially if growth in
income, recording since 2004, is not associated with an increase in inequality. However, experiences
show that at early stage of economic development, economic growth is usually accompanied by
increase in inequality. This section presents results of two scenarios - assuming that growth in
Zanzibar since 2004 has been accompanied with (i) five percent increase in Gini coefficient (ii) 10
percent increase in Gini coefficient. The latter is a highly unlikely scenario. The results of this analysis
are summarized in Figure 3.3.
Under the assumption of mild increase in inequality (i.e. of five percent), the rate of decline in headcount poverty (P0) is hardly distinguishable from that generated under constant level of inequality. This
statement is also true for the case of the poverty gap (P1). The results are however, radically different
under the assumption of 10 percent increase in the Gini coefficient. It is apparent that the headcount
ratio remains more or less unchanged if inequality were to increase by 10 percent each year. To the
contrary, with such level of inequality, poverty measured by poverty gap would have increase.
_______________________________________________________________________________ 58
Figure 3.3: Simulated poverty trends in Zanzibar since 2004 under different assumptions on the
inequality
P0
P1
51
23
49
21
19
47
17
45
15
43
13
41
11
9
39
2004
2005
Gini+5%
2006
Gini+10%
2007
2008
Gini+0%
2004
2005
Gini+5%
2006
Gini+10%
2007
2008
Gini+0%
Source: Computed based on Zanzibar HBS Dataset and Zanzibar National Accounts – Economic Survey, May 2009.
3.6
Conclusion and Policy Messages
This chapter has analyzed the pattern of economic growth in Zanzibar since 2002 and related the same
to other socio-economic indicators such as employment, labor (cash) income, and poverty indices. The
analysis can be concluded and summarized in the following messages:
i.
Overall income measured by GDP has been growing since 2002, though at declining rate.
ii. Growth has been accompanied with job creation, but the wage level (cash pay, including
benefits) has remained rather low. This indicates, partly, that there is inadequacy in the
creation of decent jobs.
iii. But concealed in that overall GDP growth are huge fluctuations in sector incomes and their
respective growth. These fluctuations imply variable incomes at household level. If such
variability is not off-set by incomes from other sectors, it further implies high levels of
vulnerability to poverty. In the absence of longitudinal HBS data, the extent of such
vulnerability can only be implied indirectly.
iv.
Also, in the absence of longitudinal HBS data, poverty level in non-survey years can not be
directly estimated. One of the ways to show the likely levels and path of poverty is to simulate
poverty path under various scenarios of income distribution.
v.
Income poverty might have declined substantially given the reported GDP growth and under
the assumption of mild increase in inequality of up to 5 percent per year. But with extreme
inequality, poverty might have increased. The exact position of where income poverty level in
Zanzibar is will wait till the result of the next HBS.
_______________________________________________________________________________ 59
CHAPTER 4: REACHING THE POOR: POVERTY AND HOUSEHOLD INCOME
DISTRIBUTION
4.1
Overview
Human Development approach emphasizes the need to evaluate development from multidimensional
perspectives which include achievement in both capabilities and functioning. As mentioned earlier, one
of the dimensions of human development is income, which can also be assessed in terms of
consumption. This chapter focuses on household income to assess poverty and inequality in Zanzibar
using the Zanzibar Household Budget Survey data collected by the Zanzibar’s Office of Chief
Government Statistician (OSGS) in 2004/2005.
It is important to note that reliance on the 2004/2005 data misses out on any dynamics that has taken
place since. Zanzibar is witnessing some rapid changes in its economy and a cursory look reveals that
there are more economic activities going on now than in 2004/2005 as can be attested by the booming
construction industry which is now reaching Pemba Island. New Household Budget Survey is being
collected now which may give a more accurate picture of poverty and inequality in Zanzibar. The picture
obtained from the 2004/2005 must therefore be taken as a useful baseline upon which assessment of
the trend will be done once the new dataset becomes available.
This chapter summarizes poverty profile of Zanzibar based on the report that the OGCS prepared from
the 2004/2005 household budget survey, and extends the analysis to incorporate axiomatically
accepted poverty and inequality measures. The analysis in this chapter also includes some sensitivity
analysis to assess the robustness of the poverty and inequality measures. With respect to poverty
measures the sensitivity analysis is conducted by assessing whether poverty ranking remains invariant
to a reasonable range of poverty lines. A poverty ranking, say between two districts, is considered to be
robust if it does not change within a reasonable range of poverty lines and if ranking remains the same
even as alternative but widely accepted poverty indices are used. As for the inequality measures,
robustness can also be assessed by using a concept of dominance in which one distribution is
compared to the other by using generalized Lorenz curves. Generalized Lorenz compares the welfare
of say two districts in terms of both the mean per capita expenditure and the extent of inequality. The
concept would be explained further below. Tests of significance would also be conducted for both
measures of poverty and inequality so as to establish whether difference in either poverty or inequality
between, say districts, is due to real difference or simply due to sampling variability.
An extended focus on income based poverty assessment is a useful compliment to the human
development approach on two main scores. First, there is generally some correlation between income
and other measures of human development (see for example, Figure 4.1). To be sure, this correlation is
far from perfect, which of course is the reason why it is inadequate to focus on income alone in the
_______________________________________________________________________________ 60
evaluation of human welfare. Second, there is a detailed and comprehensive data on consumption the
analysis of which offers useful insights into the profile of poverty and inequality.
Figure 4.1: Correlation of the HDI and per Capita Income
.2
Human Development Index
.4
.6
.8
1
HDI AGAINST GDP PER CAPITA
0
20000
40000
GDP PER CAPITA
60000
80000
Source: Data for all countries in the UNDP (2006) “Human Development Report.”
This chapter is organized as follows. Section two discusses poverty indices, and particularly the
axiomatically preferred indices. This section further reports the estimated poverty measures for
Zanzibar. Section three discusses various measurements of inequality, once again focussing on
axiomatically preferred measures and reporting estimated inequality in Zanzibar. Section four explores
policy responses and offers some proposals to the observed spatial distribution of poverty. Section Five
concludes the chapter.
4.2
Poverty Measurement: Axiomatically Preferred Indices and the Estimates
Measures of poverty by using income or consumption are generally referred to as income poverty. The
more appropriate term for this approach is money-metric measures of poverty. Ideally, one can use
either income or consumption for this purpose. In practice, however, consumption is preferred to
income for assessing poverty (see for example Deaton 1997). This is because income tends to be more
volatile than consumption and reporting of income is generally less reliable than reporting of
consumption. In this chapter we shall use household consumption as reported in the 2004/2005
Zanzibar Household Budget Survey for the purpose of assessing money-metric poverty. Household
consumption is adjusted to obtain adult equivalent per capita consumption using steps explained in the
RGZ (2006). It is this adjusted per capita expenditure that is used for calculating poverty and inequality.
We shall refer this measure of adjusted per capita expenditure by the letter x.
_______________________________________________________________________________ 61
The most popular measure of poverty and one which is used in the official poverty profile in Zanzibar is
Head Count Ratio. Head Count Ratio is also referred to as Head Count Index. This is a measure of a
fraction or a percentage of the population whose consumption level is below the minimum level
considered necessary to lead acceptable life. Poverty line is the term used to describe the minimum
level of consumption that a person needs to lead an acceptable life. Poverty line can be established by
focusing on the minimum income necessary for a person to afford minimum needed calories. Such
poverty line is called Food Poverty Line. Based on the 2004/2005 Zanzibar Household Budget Survey,
the food poverty line for Zanzibar was established to be Tshs. 12,573. Another version of poverty line is
based on the minimum income necessary to attain basic needs for an individual. This poverty line,
called Basic Needs Poverty Line, was estimated to be Tshs 20,185 in the 2004/2005 Household Budget
Survey data.
Table 4.1 ranks districts in Zanzibar in terms of Head Count Poverty. Using Basic Needs Poverty line
Mjini district turns out to have the least incidence of poverty, followed by Magharibi and Mkoani. The
poorest district is Micheweni, followed by Wete and Chake Chake.
Table 4.1: Ranking of Districts in Terms of Head Count Poverty Measure
DISTRICT
Head Count Index
(Basic Needs Basic Line)
Mjini
Magharibi
Mkoani
Kati
Kaskazini B
Kaskazini A
Kusini
Chake Chake
Wete
Micheweni
0.3761515
0.3856504
0.420844
0.4566136
0.4827795
0.5329771
0.5379265
0.568331
0.7078918
0.7423449
Ranking
In terms of Basic
Needs Poverty
10
9
8
7
6
5
4
3
2
1
Head Count Index
(Food Poverty
Line)
0.0775093
0.0954359
0.0725912
0.0834799
0.1205524
0.1218046
0.0973281
0.1586972
0.2383223
0.3335135
Ranking in
terms of Food
Poverty
9
7
10
8
5
4
6
3
2
1
Source: Mkenda (2009)
It is notable from Table 4.1 that the poverty ranking obtained using Head Count and Basic Needs
Poverty line is not identical to the poverty ranking obtained from Head Count and Food Poverty Line.
This, in itself is not a serious problem, but it is a reminder that there is a need to always check whether
poverty ranking is invariant to reasonable alteration of poverty line. This issue would be taken over
below.
4.2.1 Poverty Severity
Head Count Index is a useful measure of poverty because it is easy to understand and interpret. This
explains why it is still widely used all over the world. This measure however, has several limitations.
_______________________________________________________________________________ 62
The first obvious limitation of Head Count Index is that it does not give an indication of the depth of
poverty; it simply gives a percentage of people who are below the poverty line. For example, two
districts in Zanzibar may both have a Head Count measure of 0.30 (that is 30 percent of the people in
each districts are below the poverty line). This figure does not tell us how far below the poverty line are
the poor. Policies to alleviate poverty would treat the two districts similarly even though one district may
have the average income of the poor far below the other district.
Another limitation of the Head Count Index is that it may misleadingly indicate that poverty has decline if
income is taken away from the poorest and given to the moderately poor and result into some
moderately poor moving above the poverty line. This is to say that Head Count can indicate that poverty
has decline in a situation where commonsense indicates that poverty has actually increased!
Head Count Index is also limited in its usefulness in that it does not capture the severity of poverty. This
means that Head Count Index treats a regressive transfer by one unit from the poorest to the next poor
person the same as a regressive transfer by a unit from a moderately poor person to the next poor
person. One would prefer that a poverty index should indicate that poverty increases by a larger
magnitude if some money is taken away from the poorest person than if the same amount of money is
taken away from a moderately poor person. Put differently, we would wish a poverty index to show that
money given to the poorest person reduces poverty more than if the same amount of money was given
to a moderately poor person. This is to say that we wish a poverty index to be sensitive to the severity
of poverty. Head Count Index is not sensitive to poverty severity. Even the Poverty Gap Index, another
poverty index used by in the official poverty profile in Zanzibar, is not sensitive to poverty severity. A
poverty severity measure is given as follows;
1 m ( z  xi ) 2
Poverty Severity Index  
n i 1 ( z ) 2
Where m stands for the number of poor people, n stands for the number of people (population), z
stands for the poverty line and x is the income or consumption of individual i. This index is sensitive to
the severity of poverty because by squaring the income gap (i.e. the difference between income of the
poor and the poverty line) it gives more weight the bigger the income gap. The index is therefore more
sensitive to changes in the income of those at the bottom of poverty than it is to those closer to the
poverty line.
Table 4.2 ranks districts in Zanzibar in terms of Poverty Severity Index. One immediate impression from
Table 4.2 is that the ranking is not overly different from the ranking given in Table 4.1. For example the
three poorest districts in Zanzibar are Micheweni, Wete and Chake Chake irrespective of the index
used.
_______________________________________________________________________________ 63
Table 4.2: Ranking of Districts in Terms of Poverty Severity Index
DISTRICT
Poverty Severity Index
(Basic Needs Basic Line)
Mkoani
Mjini
Kati
Magharibi
Kusini
Kaskazini B
Kaskazini A
Chake_Chake
Wete
Micheweni
0.029879
0.033261
0.034566
0.035719
0.042548
0.043778
0.046978
0.056207
0.085545
0.109935
Ranking
In terms of
Basic Needs
Poverty
10
9
8
7
6
5
4
3
2
1
Poverty Severity
Index
(Food Poverty
Line)
0.002113
0.00482
0.00256
0.004924
0.003512
0.006084
0.004913
0.006765
0.014225
0.020776
Ranking in
terms of Food
Poverty
10
7
9
5
8
4
6
3
2
1
Another pattern in the poverty ranking by districts is that districts in Pemba Island are invariably doing
worse than districts in Unguja Island, with the exception of Mkoani district in Pemba which is
consistently ranked above the median. Micheweni, Wete and Chake Chake and Mkoani are districts
located in Pemba, while the rest of the districts are in Unguja.
It is important to explore further this distribution of poverty across districts to determine whether the
observed differences are statistically significant or whether this is simply a matter of sampling variability.
Table 4.3 Confidence Interval of Difference in Poverty Severity between Districts
District 1
Mjini
Mjini
Mjini
Mjini
Mjini
Mjini
Mjini
Mjini
Mjini
District 2
Kaskazini A
Kaskazini B
Kati
Kusini
Magharibi
Wete
Micheweni
Chake Chake
Mkoani
Poverty Severity
Difference
Between District 1
And District 2
-0.013717*
-0.010517
-0.001305
-0.009288
-0.002458
-0.052285*
-0.076675*
-0.022947*
-0.026328*
Lower Bound
Upper Bound
-0.027301
-0.028290
-0.013308
-0.020925
-0.013160
-0.066510
-0.097697
-0.042669
-0.046005
-0.000134
0.007255
0.010697
0.002349
0.008244
-0.038059
-0.055652
-0.003224
-0.006651
* Significantly different from zero, see Mkenda (2009)
_______________________________________________________________________________ 64
Table 4.3 gives a remarkable picture that indicates that there is hardly any statistically significant
difference in poverty between Mjini districts, which is in Unguja Island and other districts in Unguja.
Kaskazini A district is the only one that bucks this trend. On the other hand, the difference in poverty
between districts in Pemba Island and Mjini district are all statistically significant. This suggests that
there is a remarkable difference in poverty between Unguja Island and Pemba Island.
4.2.2 Sensitivity Analysis to Poverty Measures
The pattern of poverty across district suggests that Pemba Island suffer more poverty than Unguja
Island. This pattern is constructed through the application of a fixed poverty line. It is important to find
out whether a change in the poverty line would alter this pattern. The reason for doing this is that
poverty line is a nebulous concept. The poverty line that the OCGS used for assessing poverty is
constructed using well argued and generally accepted methods, but it is also generally agreed that
there is a range of values that can reasonably represent poverty line for each country. Indeed two good
researchers may come up with different poverty lines from the same data by adopting two different but
equally reasonable approaches for estimating poverty line. It is therefore natural that one should find
out whether poverty ranking obtained using one poverty line would hold for alternative but reasonable
poverty lines. For example, using the poverty lines above it is found that districts in Pemba Island are
generally poorer than the districts in Unguja Island. Before this fact is taken into account in policy
formulation and resources allocation it is important to find out whether this ranking would hold even if
poverty line is altered within reasonable range. If altering the poverty line within a range considered to
be reasonable produce a different ranking, say, that Unguja’s districts are poorer than Pemba’s
districts, then we must know that our finding is not unambiguous and therefore cannot be used for
policy on spatial allocation of resources.
A technique called stochastic dominance test allows the sensitivity analysis of poverty measures by
reporting poverty ranking over a range of poverty lines. If poverty ranking remains invariant over the
selected and reasonable range of poverty lines then we know we can draw unambiguous conclusion
regarding where poverty is higher and where poverty is lower. Stochastic dominance can be of first
order, second order, or third order and so on. First order stochastic dominance relates to Head Count
Index. If poverty in district A first order stochastically dominate poverty in district B, it means that using
Head Count Index we find that there is lower poverty in district A than in district B. What is more, it also
means that even if we had used Poverty Gap Index or Poverty Severity Index, we would still find that
there is less poverty in district A than in district B. And there is more to it still. If District A first order
stochastically dominates district B, it means that even if we were to use other poverty indices that
satisfy some minimum and reasonable conditions, such as Watts Index, we would still find poverty is
less in district A than in district B. It is clear therefore that stochastic dominance is a very valuable tool
for assessing robustness of poverty ranking.
If no first order stochastic dominance can be established, it simply means that using Head Count Index
we can not say unambiguously that poverty is lower in one district than in another. But this does not
_______________________________________________________________________________ 65
preclude the districts being unambiguously ranked in terms of Poverty Gap, a ranking that is called
second order stochastic dominance. Second order stochastic dominance is ranking of poverty by
Poverty Gap over a reasonable range of poverty lines. Further, if second order stochastic dominance is
not established it is still possible to find third order stochastic dominance, which is ranking poverty by
Poverty Severity Index over a range of poverty lines. Whenever first order dominance is found, it
implies all higher order stochastic dominance such as second order or third order would also hold.
Armed with the concept of stochastic dominance we now review poverty ranking between Mjini district
and other districts in Zanzibar. The main thrust of this analysis is to find out whether indeed Pemba
suffers more poverty than Unguja within a wide range of poverty lines. Figure 4.2 shows graphs of first
order stochastic dominance tests for districts in Zanzibar. The graphs for the districts in Pemba are
made thicker to enable comparisons to graphs of districts from Unguja, which are made thinner in the
figure. It is immediately clear that three districts from Pemba, namely Micheweni, Wete and Chake
Chake have more poverty than the rest of the districts over a wide range of poverty lines. This can be
seen by the fact that their graphs are higher than the rest. Micheweni has more poverty than all districts
over the wide range of poverty lines. The only district in Pemba that bucks this trend is Mkoani.
To explore further this pattern of the distribution of poverty a comparison is made between Pemba and
Unguja. A statistical test of significance indicates that for poverty lines within the range of 5335.225 and
172,834, Pemba has more poverty than Unguja. It can therefore be said with confidence that Pemba is
poorer than Unguja, a fact that need to be taken into account in formulating any policy for reaching the
poor.
_______________________________________________________________________________ 66
Figure 4.2: First Order Stochastic Dominance Graphs
.8
.6
.4
.2
0
FGT(z, alpha = 0)
1
FGT Curves (alpha=0)
2000
9600
17200
24800
32400
40000
Poverty line (z)
Kaskazini A
Kati
Magharibi
Wete
Chake Chake
Kaskazini B
Kusini
Mjini
Micheweni
Mkoani
Figure 4.3: Stochastic Graphs for Pemba Island against Unguja Island
.6
.4
0
.2
FGT(z, alpha = 0)
.8
FGT Curves (alpha=0)
0
6000
12000
18000
24000
30000
Poverty line (z)
Unguja
4.3
Pemba
Inequality and Household Welfare in Zanzibar
After ranking districts in Zanzibar in terms of poverty, it is also important to look at another dimension of
household welfare, namely inequality. If two districts have the same mean income, the one with higher
inequality is worse off than the one with lower inequality. A novel measure of household welfare called
_______________________________________________________________________________ 67
generalized Lorenz curve compares household welfare in terms of both mean income and inequality
and permits ranking of districts using such a combination of welfare measures.
Several arguments can be made in favour of a more equal society. First, it has always been the
aspiration of the Revolutionary Government of Zanzibar to build a more equal society. Indeed, it can be
argued that the revolution itself was prompted by the need to redress the appalling inequality that
existed in Zanzibar prior to 1964. Income inequality has a tendency of creating inequality in political
influence, which means that high inequality is inimical to democracy. Inequality fosters political tension
which may lead to violence and even insurgency. A society that has a very high inequality tends to
generate inequality in opportunities too, and thus severely restricting mobility across income classes.
Ultimately such a society generates skewed income distribution that has nothing at all to do with
meritocracy. For these reasons it is important to assess extent of income inequality in Zanzibar as a
way of monitoring the trend and informing policy to redress high inequality.
4.3.1 Gini Coefficient and Generalized Entropy Measure.
Table 4.4 reports inequality measures by districts of Zanzibar. Both Generalized Entropy Index
measures and Gini coefficient measures are reported. As for the Gini coefficient, perfect equality is
represented by 0 while perfect inequality (that is, the situation in which only one person owns the entire
income and the rest earns nothing) is represented by 1. The district with the most inequality in terms of
the Gini coefficient is Mjini. This is expected because Mjini is the metropolitan city of Zanzibar where
people with different incomes, employment status and education backgrounds live. Magharibi district
follow Mjini closely in terms of inequality, which again is not surprising given the fact that Magharibi is
the sub-urban of Mjini. Next in inequality is Kaskazini A, a district that is famous for tourism. The district
with least inequality is Kusini, a district that is in Unguja.
Table 4.4: Inequality Measures
District
Mjini
Magharibi
Kaskazini A
Kati
Chake Chake
Wete
Micheweni
Kaskazini B
Mkoani
Kusini
GE(-1)
GE(0)
GE(1)
GE(2)
Gini
0.17583
0.1589
0.17121
0.22631
0.31242
0.13008
0.11813
0.12167
0.14407
0.26952
0.11512
0.11313
0.12949
0.19507
0.26369
0.10883
0.10809
0.12106
0.15876
0.25852
0.11095
0.10921
0.12802
0.19863
0.25556
0.10285
0.10016
0.11271
0.16238
0.2461
0.10145
0.09662
0.1014
0.11914
0.24569
0.10171
0.0958
0.10184
0.12646
0.24061
0.09153
0.08809
0.09333
0.11107
0.23393
0.08629
0.08391
0.08933
0.10542
0.2288
_______________________________________________________________________________ 68
In general there is no systematic pattern in inequality between districts in Unguja and Pemba. Table 4.5
compares inequality between Pemba and Unguja. Irrespective of the index or parameter chosen,
Pemba has more inequality than Unguja. The Gini coefficient for Pemba is 0.28422 while for Unguja is
0.25662
Table 4.5: Inequality, Pemba vs. Unguja
Island
GE(-1)
GE(0)
GE(1)
GE(2)
Gini
Pemba
0.13964
0.1309
0.14236
0.18728
0.28422
Unguja
0.11307
0.10767
0.11769
0.15841
0.25662
A test indicates that the difference in the Gini coeffient measure between Pemba and Unguja is
significantly different from zero. This result is surprising, one would expect that since Unguja has the
largest urban area and therefore wide range of economic activities, inequality would be higher in
Unguja than in Pemba.
4.3.2 Generalized Lorenz Curves
Next we rank districts by the Generalized Lorenz curves. Generalized Lorenz curve ranks groups in
terms of welfare by combining levels of mean incomes and a measure of inequality (Shorrock 1984).
The idea behind generalized Lorenz is that generally a district with higher mean income is better off in
welfare terms than a district with lower mean income. However, a district with less inequality is better off
in welfare terms than a district with higher inequality. Shorrock (1984) has shown that it is possible to
combine mean income and measure of inequality to rank districts by using Generalized Lorenz Curve.
A district with higher curve is better off than a district with lower curve.
Figure 4.4 reports generalized Lorenz curves for Unguja and Pemba. The result is clear and
unambiguous; Unguja is better off than Pemba in terms of combined dimensions of inequality and mean
income. This results suggest that there is a serious disparity in welfare between Unguja and Pemba.
_______________________________________________________________________________ 69
Figure 4.4: Generalized Lorenz, Unguja and Pemba
15000
10000
0
5000
GL(p)
20000
25000
Generalised Lorenz Curves
0
.2
.4
.6
.8
1
Percentiles (p)
Unguja
Pemba
Figure 4.5 explore the ranking of Pemba districts in terms of Generalized Lorenz. Again, it is clear that
there is disparity between districts, with Micheweni being worse off and Mkoani being the district that is
better off. So, even if the finding is that Pemba is worse off than Unguja, there is disparity within Pemba
that also needs to be addressed.
Figure 4.5: Generalized Lorenz, Districts in Pemba
15000
10000
0
5000
GL(p)
20000
25000
0
.2
.4
.6
.8
1
Percentiles (p)
Wete
Micheweni
Chake Chake
Mkoani
Figure 4.6 displays generalized ranking of districts in Unguja. Mjini district turns out to be better off than
other districts, while Kusini is worse off. Once again this indicates that it is important to assess spatial
_______________________________________________________________________________ 70
distribution of household welfare in designing policies and distributing resources, because of the
existing disparity.
Figure 4.6: Generalized Lorenz, Districts in Unguja
0
10000
GL(p)
20000
30000
0
.2
.4
.6
.8
1
Percentiles (p)
4.4
Kaskazini A
Kaskazini B
Kati
Kusini
Magharibi
Mjini
Reaching the Poor: Policy Response and Proposals
When inequality and poverty follows some geographical patterns as shown above the need to address
the problem becomes even more urgent. This is because such geographical disparity can quickly turn
into destabilizing polarization, particularly when peoples maintain strong identities delimited around
these geographical areas. The first step is to find out the reason for such a pattern. In some cases,
geographical and geological condition may explain the disparity in household welfare across
geographical areas. For example, the fact that Pemba is far off from Unguja and that Unguja is the hub
of commerce and industry in Zanzibar may explain, albeit partly, the existing disparity between the two
islands. Further, it is clear that agrarian households in the coral area in Zanzibar are likely to be worse
off than similar households in non-coral areas. Micheweni district in Pemba is a coral area, which may
explain a great deal why the district is the poorest in Zanzibar, but this would not explain why Chake
Chake and Wete are the poorest districts.
Some geographical disparities in welfare may be explained by opportunities, or lack of opportunities
created by policy. For example, historically determined inequality in educational opportunities may
explain to some extent the disparity in household’s welfare. Budgetary allocation across districts
therefore needs to respond to this disparity. Some of the causes of disparity may need explanation from
such fields as sociology and anthropology because geography and economics may not exhaustively
explain it. For example, there is a large community of people from Pemba in Unguja, Tanzania
Mainland and abroad, the community that is renowned for industry and entrepreneurship. The question
then is, why is it that this success is not translated into investment and development in Pemba?
_______________________________________________________________________________ 71
4.4.1 Explaining the Disparity
The first point of departure in analyzing policy response is to try to find out explanations for the existing
disparity. The focus in this explanation would be to explain the disparity between Pemba and Unguja.
Historically the seat of the government in Zanzibar has been in Unguja where more diversified
economic activities take place. Further more, Unguja is closer to Dar es Salaam, a metropolis of
Tanzania, which makes it easy for commerce and industry to flourish in Unguja than in Pemba in spite
of the fact that Pemba is the leading producer of cloves which for a long time has been the mainstay of
the economy. This pattern of the metropolitan area to attract more volume and diversity of economic
activity is common the world over, and it also appears in the Tanzania Mainland where Dar es Salaam
commands the lion share of industrial production and other economic activities.
The 2001 Census of Industrial Production shows that more industrial establishments are located in
Unguja than in Pemba, as shown in Table 4.6. Mjini, Magharibi and Kaskazini A are the districts with
the largest concentration of industrial establishments in Zanzibar.
Table 4.6: Distribution of Industrial Establishments By Size and Districts in 2001
District
Kaskazini A
Kaskazini B
Kati
Kusini
Mgharibi
Mjini
Wete
Micheweni
Chake Chake
Mkoani
Total
17
4
7
2
18
31
2
2
8
3
Less than
10
6
1
1
2
2
2
2
3
2
10-14
15-19
20-49
10
1
4
1
8
18
3
-
1
1
2
4
-
3
1
3
5
-
50 and
above
3
2
2
1
Source: OCGS (2004)
Table 4.7 shows the distribution of tourists’ hotels by the classification and area. It becomes
immediately clear that there are by far more hotels in Unguja than in Pemba. Stone Town alone boasts
of 73 hotels with 1013 rooms as compared to 20 hotels and 168 rooms in the entire area of Pemba.
Again this indicates a skewed distribution of opportunities between the two major islands, a distribution
that favours Unguja. Concentration of tourism activities may also offer opportunities for the local
communities to benefit in terms of commerce and employment opportunities. Lange (forthcoming)
calculated that the percentage of total expenditure of tourists that go to the local communities as
ranging from 4 percent to 63 percent, where All-Inclusive Club tourism offers the least benefits and the
budget tourism offering the maximum benefits. The last Zanzibar Household Budget Survey shows that
only 0.4 percent of the population aged between 15 and 64 years old have tourism as their main
_______________________________________________________________________________ 72
economic activities. Chapter 5 of this report shows even less percentage of people in Pemba are
engaged in tourism.
It must be noted that tourists’ hotels are built by private investors. Locations of these hotels depend
very much on the availability of tourists’ attractions as well as the infrastructure. Pemba has a lot to
offer for tourism but for sometime infrastructure has been very poor.
Table 4.7: Distribution of Hotels/Guest Houses by grading and district
Location
Stonetown
Category
Qty
Rooms
Beds
Qty
Rooms
Beds
Qty
Rooms
Beds
Qty
Rooms
Beds
5 Star
1
51
102
1
50
95
7
896
1887
4
385
770
-
-
-
4 Star
5
129
208
2
25
59
4
436
928
2
82
153
-
3 Star
3
65
92
4
223
374
5
301
596
1
20
20
1
16
35
2 Star
3
50
101
3
57
89
3
80
160
4
52
108
1
11
22
1 Star
Grade A
Vicinity
North East coast
South East Coast
Qty
Rooms
Pemba
Beds
-
-
3
41
81
2
25
52
3
66
132
3
46
71
3
34
68
28
265
486
7
62
114
21
373
745
34
373
698
5
39
76
Grade AA
2
35
55
1
4
8
2
57
94
3
49
89
No-grading
28
377
719
21
201
360
22
209
424
33
330
750
10
68
131
Total
73
1013
1844
41
647
1151
67
2418
4966
84
1337
2659
20
168
332
Source ZCT 2008
One of the most vexing problems in Pemba has been lack of electric power. Unlike Unguja, Pemba was
not connected to the national power grid. As a result power has been very unreliable in Pemba,
something that is inimical to the development of both manufacturing and hospitality industry. Table 4.8
shows that above 70 percent of all households connected to electricity in Zanzibar are in Unguja Island.
Unguja tend to have about 60 percent of the entire population in Zanzibar.
Table 4.8: Number of Households Connected to Electricity
Year
2003
Unguja
2602
Pemba
566
Zanzibar
3168
Source: Economic Survey, 2008
2004
2472
501
2973
2005
1963
567
2530
2006
2857
838
3695
2007
3588
314
3902
2008
2754
435
3189
Another problem that has bedevilled Pemba for a long time was lack of paved roads. Poor roads and
the fact that Pemba is positioned remotely from Unguja and Tanzania Mainland, may explain a great
deal of economic difficulties that face Pemba. For example, food crops that could generate money to
farmers through markets in Unguja and Tanzania Mainland cannot easily be sold to these markets
because of transport challenges. Another possible explanation for the depressed economic situation in
Pemba is the large flow of outmigration that the Island faces. To start with, people from Pemba seem to
be quite adept at seeking business opportunities anywhere in the country. As a result of this a large
number of people from Pemba have settled in Unguja, Dar es Salaam and in many other places to run
business. People from Pemba who have settled elsewhere are doing quite well indeed and if they were
_______________________________________________________________________________ 73
included in the household budget survey under Pemba the level of poverty would not have been so
high. One indicator of high mobility of the people from Pemba is the very high dependency ratio
reported in the household budget survey for districts of Pemba. This suggests that able bodied persons
tend to move to other places to seek greener pasture. All districts of Pemba have dependency ratio that
is greater than on, even though on average the household size in Pemba is not different from that found
in Unguja. Naturally one would have expected that remittances would have been a source of economic
uplifting in Pemba but this has not proved the case so far.
4.4.2 Policy Response and Proposals
The data that has been used to assess poverty and inequality was collected in 2004 and 2005. A lot of
things have changed since. A number of roads are being paved in Pemba and soon all major roads
would be tarred. Further, Pemba is now being connected to the national power grid through underwater
power cables that links Pemba and Tanga in Tanzania Mainland. Construction industry is also now
booming in Pemba, perhaps indicating that both investors and the people of Pemba who have settled
outside Pemba are responding to the improvement in the infrastructure.
Tourism has not developed much in Pemba. This can be an opportunity to take lesson from the
development of tourism in Unguja so far and use that lesson in developing tourism in Pemba. One
proposal that has been made so far is to focus on ecotourism in Pemba so as to maintain
environmental and cultural integrity of Pemba. Chapter 5 of this report shows that a focus on up-market
tourism is more likely to maximize benefits to Zanzibar while at the same time avoiding environmental
degradation through mass tourism. This approach can be adopted in Pemba and particularly measures
to avoid investors who hold land for speculative purposes need to be put in place.
Table 4.9 gives figures for budgetary allocation to the districts, which offers an opportunity to assess
whether levels of poverty are taken into account in such allocation. It must however, be pointed out that
budgetary allocation cannot simply be based on poverty levels. More over, poverty is not simply solved
by pumping money; specific constraints must be addressed and deliberate targets pursued in terms of
resource allocation and other measures. Still it is important to find out the extent that budgetary
allocation is responsive to disparity in poverty levels.
_______________________________________________________________________________ 74
Table 4.9: Budgetary Allocation by Districts
1
2
3
4
5
6
7
8
9
10
1
2
Mjini
Magharibi
Kati
Kaskazini "A"
Kaskazini "B"
Kusini
Wete
Mkoani
Chake Chake
Micheweni
Wilaya Ndogo
Tumbatu
Kojani
BUDGET ALLOCATION BY DISTRICTS 2004/05 - 2001/10 ZNZ
2004/05
2005/06
2006/07
2007/08
143,077,000
138,967,000
154,147,000
260,546,000
137,528,000
115,167,000
132,522,000
162,410,000
136,675,000
116,993,000
143,319,000
131,521,000
92,490,000
91,137,000
105,717,000
190,246,000
83,068,000
83,714,000
106,284,000
153,156,000
120,559,000
98,912,000
127,160,000
195,778,000
78,288,000
76,732,000
84,758,000
135,645,000
90,467,000
73,702,000
80,477,000
118,111,000
92,633,000
77,999,000
87,369,000
138,530,000
70,078,000
75,410,000
78,300,000
110,494,000
13,811,000
7,174,000
11,830,000
20,884,000
12,450,000
34,075,000
12,365,000
2008/09
266,632,000
201,696,000
232,382,000
255,366,000
180,368,000
197,076,000
209,380,000
152,271,000
192,282,000
138,510,000
2009/10
26,430,100
18,245,900
251,750,000
215,611,000
173,055,000
202,034,000
218,000,000
175,778,000
209,207,000
155,000,000
34,160,000
18,539,000
30,310,000
20,000,000
Table 4.10 gives per capital distribution of resources to the districts in 2008/09. There does not appear
to be a correlation between levels of poverty and budgetary allocation to the districts. For example,
Micheweni, which is the poorest district in Zanzibar, gets one of the lowest per capital budgetary
allocation. Only Chake Chake features among top five districts in terms of per capita budgetary
allocation, and still is the last one among the top five. The remaining districts in Pemba appear in the
last five districts ranked in terms of the size of per capital budgetary allocation to the districts. There is
obviously a need to include levels of poverty in allocating budgetary resources to the districts.
Table 4.10: Distribution of Per Capital Budgetary Allocation by Districts, 2008/9
District
Kusini (U)
Kati
Kaskazini "B"
Kaskazini "A"
Chake 2
Wete
Mkoani
Micheweni
Mjini
Magharibi
Per Capita Budgetary Allocation
5358.82097
3271.373267
2982.695278
2919.05026
1749.194913
1636.765867
1433.557085
1304.003992
1039.326741
993.7770683
_______________________________________________________________________________ 75
4.5
Conclusion
There is some disparity in household welfare in Zanzibar. This disparity is manifested spatially across
districts. Micheweni is the poorest district in Zanzibar, followed by Wete and then Chake Chake. In
general, three of the four districts of Pemba suffer the highest poverty in Zanzibar. This ranking is
robust over a wide range of poverty line specification and across a number of widely accepted poverty
indices.
There is a wide disparity in the income inequality across districts too, with the highest being Mjini, which
has a gini measure of 0.31 and the lowest being Kusini, which has the gini measure of 0.23. There is no
clear pattern of income inequality across districts over the two main islands of Unguja and Pemba.
However, over-all Pemba suffers more inequality than Unguja. This is surprising because there is a
wide range of economic activities in Unguja than in Pemba and thus opportunities of having disparity of
income should have been greater in Unguja than in Pemba.
The data that has been used in this chapter was collected in 2004/05. A lot has happened since then. In
particular there is more improvement in the infrastructure in Pemba, including a connection to the
national power grid. Construction industry is also now booming in Pemba. New data on poverty might
give a different picture on poverty due to these developments. This chapter therefore mainly offers a
baseline against which to assess performance.
Two main policy proposals emanate from this chapter (together with the next chapter). First, since
Pemba does not yet have well established tourist industry in spite of its numerous attractions, efforts
need to be put in place to ensure that tourism development in Pemba targets both eco-tourism and upmarket tourism in order to ensure maximum benefits to Zanzibar. Another proposal is that levels of
poverty be one of the factors used in allocating resources to the districts. Poverty levels cannot be the
only criteria to be used for budgetary allocation, but currently it appears that it is not taken into account
at all, which does not bode well for the effort to reach the poor.
_______________________________________________________________________________ 76
CHAPTER 5: TOURISM PERFORMANCE AND ITS LINKS TO HUMAN
DEVELOPMENT
“…the quality of tourism Zanzibar receives does not meet that expected by Government who wish to promote
Zanzibar as an up-market destination to compete with other island destinations in the Indian Ocean region.
Unfortunately, the current trend of tourism development is based on the low quality, low spending clients”. URT
(2003) “Indicative Tourism Master Plan for Zanzibar and Pemba”.
5.1
Overview
This chapter focuses on the tourism sector by reviewing the extent that this sector contributes to
economic growth and human development in Zanzibar. There are several reasons for focusing on
tourism. First, tourism is now the largest earner of the foreign exchange in Zanzibar. Going by the 2005
estimates, earning from tourism accounted for over 20 percent of the GDP in Zanzibar8. For this
reason, no pro-poor growth strategy would be meaningful in Zanzibar without including tourism.
Compared to other islands along the Indian Ocean and taking into account the great appeal and the
variety of tourists’ attractions that Zanzibar is endowed with, it is also clear that there is still a significant
scope for growth of tourism in Zanzibar. Mauritius and Seychelles are two island nations in the Indian
Ocean that rely heavily on tourism, and they are the only two Sub Saharan African countries in the
group of High Human Development countries. It is therefore not a far fetched dream for Zanzibar to
aspire to compete with these two Islands with the intention of increasing economic growth and attain
higher human development level. Indeed, tourism is one of the sectors identified in the Zanzibar
Strategy for Growth and Reduction of Poverty (popularly known in its Kiswahili acronym as MKUZA) for
accelerating economic growth.
Secondly, it is well known that tourism can create mass employment, particularly to the poor and to the
women (ILO 2001), which means there is a potential for using tourism for poverty eradication. Lange
(forthcoming) estimated that 40 percent of employees in tourists’ hotels in Zanzibar are women. Very
few dynamic sectors hire such a high proportion of women. Tourism can also offer employment to large
number of unskilled people, which means the poor can find employment in the sector relatively easy.
Indeed, the UN Commission on Sustainable Development urged governments to “maximize the
potential for tourism for eradicating poverty” (UN 1999).
This is based on the following information. The estimated from the Survey of tourists expenditure in Zanzibar conducted by
the Bank of Tanzania, Ministry of Natural Resources and Tourism and the Zanzibar Commission of Tourism indicated that
Zanzibar earned a total of USD 11,358, 688.35 from tourism. The Zanzibar Economic Survey Report of 2008 issued by the
Office of Chief Government Statistician indicated that Zanzibar GDP at current market price was Tshs 394.9 billion, which, at
the prevalent exchange rate of 1128 is equal to USD 350,088,652. Based on these figures, gross earnings from tourism is
equal to 31 percent of Zanzibar’s GDP. To get the contribution to the GDP one must use value added approach, which
means we remove any double counting. In this way the share of tourism to GDP is expected to be less than 31 percent but
certainly more than 20 percent. Using value added approach Lange (forthcoming) calculated the share of tourism to the
GDP in 2007 to be 25 percent.
8
_______________________________________________________________________________ 77
Thirdly, tourism can spur development of infrastructure, which also benefits local economic activities.
Infrastructural development can be spurred both by the revenue that tourism generates and also by
deliberate investment by the government for the sake of expanding the tourism sector.
Yet tourist sector itself, no matter how big it is, would not guarantee reduction of poverty and promotion
of human development. To start with, it is quite easy for tourist sector to expand while maintaining very
weak backward and forward linkages to the rest of the economy, thus denying the economy useful
multiplier effect. The nature of tourism may determine whether the financial benefits from tourism
accrue primarily to the government and the people or to foreign multinationals and few tour operators.
The benefits from tourism can also accrue only to few local people, excluding majority of local
communities. Growth of tourism therefore can easily lead to growing inequality and a sense of
alienation in the country. Further, it has been estimated that employees in tourist sector receive less
pay than employees with similar qualifications and on comparable occupation in other sectors (ILO
2001). Indeed with excess supply of labour in Zanzibar it is easy for the tourist sector to take advantage
and under-pay its employees9.
Secondly, mass tourism may lead to severe environmental degradation. Tourists typically come from
high income countries and thus their consumption level is likely to generate more waste than the local
arrangements can cope with. Further, concentration of tourists in a given area can increase pressure
that can damage the ecosystem. Ecosystem such as coral reefs have limited carrying capacity, which
means the number of tourists allowed into such environment, if left unchecked, would damage the
ecosystem.
Third, the flow of tourists is prone to very high volatility where an event such as the 9/11 terrorist attack
in the USA or the global financial crisis can easily cause sharp decline in the inflow of tourists. This
means that those whose livelihoods depend on this sector can easily find themselves in doldrums.
Indeed, tourism sector tend to have a very high proportion of part time employees; typically a very small
core staff is maintained on permanent basis while the rest of employees are engaged on part time basis
depending on the seasonal flow of tourists. The fact that tourism is prone to seasonal variation and
unpredictable shocks means that it is very risky for the economy to depend on tourism as its mainstay.
The seasonality of employment of this sector creates uncertainty to employees and entails a high risk of
lay off.
Tourism can also turn out to be a major nuisance to the local people because it can undermine their
dearly held cultural values. In some cases, tourism can negatively affect the welfare of the communities
by denying people access to areas such as beaches that were common property to the community.
Indeed Jiddawi and Khatib (2007) attribute the recent decline in the number of fish landing sites in
Zanzibar to appropriation of some beaches for tourism. Increase in the inflow of tourism can also
This is not to discount the fact that lack of skills can explain a great deal of low payment that the local earn from
employment in the tourist sector. There is a need to foster training policy to upgrade skills and thus justify higher pay.
9
_______________________________________________________________________________ 78
increase congestion of people and can lead to inflationary pressure to goods such as fish and assets
such as land with detrimental effect to the local people.
Tourism is therefore a double edged knife; it can be used to foster growth, accelerate the reduction of
poverty and fostering of human development. Tourism can also inflict more cost than benefit to the
economy by alienating local people, undermining social fabrics, including eroding cultural heritage and
introducing alien social vices. Tourism can also cause environmental degradation and increase income
inequality in the society.
This chapter reviews the performance of tourism in Zanzibar with view to assessing the extent that it
contributes to broad-based growth as aspired in MKUZA. The chapter reviews the current levels of
tourism and explain the existing potentials for expanding the sector in section 2. Section 3 discusses
the connection between economic growth and tourism in Zanzibar. In spite of lack of sufficient data, the
section attempts to use various sources and evidence to link growth and tourism in Zanzibar. Section 4
discusses issues of distribution. This covers both the distribution of ownership of tourist enterprises and
the distribution of other benefits from tourism. The thrust of the section is to assess the extent that
tourism-induced growth can indeed be broad-based as envisaged in MKUZA. Section 4 concludes the
chapter by making some policy proposals.
5.2
The Level and the Potential of Tourism in Zanzibar
There has been a dramatic increase in the tourists flow to Zanzibar in the last three decades. Figure 5.1
shows that the number of tourists visiting Zanzibar has increased dramatically from 1980 to 2008.
Consequently, investment in hotels and restaurants now dwarfs investment in all other sectors.
Between 1997 and 2007 a total of USD 1,038,464,997 was invested into hotels and restaurants alone,
which is 72.46 percent of all investment in the entire economy of Zanzibar over this period (ZIPA 2007).
Revenue from the sectors related to the tourism has also been growing over time as shown in Table
5.1.
0
50000
Arrivals
100000
150000
Figure 5.1: Tourist Arrivals in Zanzibar; 1980-2008
1980
1990
2000
2010
Year
In spite of the dramatic increase in the number of tourists in the last three decades, there is still a large
scope for expanding tourism further. Zanzibar has perhaps higher potentials for tourism than any other
_______________________________________________________________________________ 79
West Indian Ocean Islands such as Mauritius and Seychelles. In terms of air transport, Zanzibar is
nearer to the regional hub of Jomo Kenyatta International Airport than the other Islands, and it is quite
easy to fly to Zanzibar directly through Zanzibar International Airport or via two other international
airports of Kilimanjaro International Airport or Julius Nyerere International Airport. Zanzibar is also close
to major safari destinations of Tanzania, which boasts the largest animal sanctuary in the world, and
Kenya, which has a well established tradition of safari tourism, and thus makes it easy for tourists to
enjoy both a safari tour in, say Serengeti or Ngorongoro, and complete the tour with a holiday along the
idyllic sunny beaches of Zanzibar.
Table 5.1: Contribution of Tourism Sector to the Economy (2001/02-2005/06)
TAX CATEGORY
VAT Local
Excise Duty-Local
2001/02
2002/03
2003/04
2004/05
2005/06
7,578
107
9,641
140
13,454
138
16,191
3,076
19,326
2,698
Hotel levy
176
237
316
656
1,521
Restaurant Levy
30
64
91
154
478
20
7,911
25
10,107
41
14,040
68
20,145
86
24,109
Tour Operation Levy
Total
Source: Zanzibar Statistical Abstract (2008)
Zanzibar has a variety of tourist attractions. It has a fantastic marine environment with pristine coral
reefs for snookering and diving, blue waters dotted with dolphins, sea turtles, big game fish, serene offshore islets, and fine sandy beaches. Zanzibar is also famous for Stone Town, the old historical city that
is one of the global heritage sites. Other interesting historical sites in Zanzibar include Maruhubi Palace,
Mtoni Slave Chamber, Ruins of Mtoni Palace, Mangapwani Slave Caves and Kidichi and Kizimbani
Persian Baths. Zanzibar also boasts of spice tour and forests that contain endemic red colobus
monkeys.
In spite of the numerous and uniquely appealing tourists’ attractions and the fact that Zanzibar is easier
to fly into than Mauritius and Seychelles, Zanzibar does not attract as many tourists as the two Island
nations. Table 5.2 compares tourists’ arrivals in Zanzibar against the other islands; the number of
tourists who visit Zanzibar is less than 20 percent of the tourists that visits Mauritius. Seychelles too
receive more tourists than Zanzibar. This of course indicates that Zanzibar has a potential to bring in
more tourists. The question is whether just bringing in more tourists would be beneficial to Zanzibar.
_______________________________________________________________________________ 80
Table 5.2: Number of Tourist Arrivals (2006-2008)
COUNTRY
Zanzibar
Mainland Tanzania
Maldives
Seychelles
Mauritius
2006
137,111
644,124
601,860
140,627
788,276
2007
143,256
719,030
675,889
161,273
906,971
2008
128,440
683,012
158,952
930,456
Sources: Sharon Sooknah (2008); Zanzibar Statistical Abstract (2008); Cindy (2008); Shihar Aneez (2008); Mauritius Tourism Authority
(2008); Francos Industry Research Solution (2008); Mbona Israel (2008); National Statistic Bureau (2008)
Table 5.3 shows that Mauritius rakes up 40 times more government revenues from tourism than
Zanzibar. This actually means that Mauritius collects more revenue per a visitor than Zanzibar, and that
had Zanzibar collected revenue at the same rate as Mauritius, it would have raked up USD 150 Million
from the current rate of arrivals. In terms of exploring ways of increasing economic benefits from
tourism it is important to focus not only on the number of arrivals, but also on how taxes and levies from
tourism are being collected in view of increasing revenue collection. It must be noted that Mauritius has
put a deliberate policy to focus on high income tourists to maximize income. Low budget tourism is not
encouraged in Mauritius. To promote up-market tourism, charter flights have been banned in Mauritius,
the resort hotels have been built to high standards and there are high standards of cuisine and service.
There are direct flights from Britain and South Africa.
Table 5.3: Comparison of Revenue and Labour Force in Tourism Sector
Country
Zanzibar
Revenue
(USD Million)
Percentage To
GDP ( percent)
Number Of People
Employed In The
Industry
Total Labor
Force
( percent) Of
Tourism
Workers To
Total Labor
Force
24.1
15
24,000
396,000
6
1,000
17
200,000
20,000,000
1
Maldives
240
28
25,000
128,800
19.4
Seychelles
120
21
25,000
39,560
6310
1,089
9.2
35,000
584,000
6
Mainland Tanzania
Mauritius
Source: Bernard Krief Consultants (2007); World fact book Tanzania (2008); World fact book Seychelles 2008, World fact book
Mauritius (2008); Gelem – Marine Lange (forthcoming 2009)
Table 5.4 gives comparative figures for hotel accommodations between Zanzibar on one hand, and
Tanzania Mainland and Western Indian Ocean Islands, on the other hand. In spite of the fact that
Mauritius attracts about ten times the number of tourists that Zanzibar attracts, Zanzibar has more
hotels and other accommodation establishments than Mauritius. The number of beds in Mauritius is
however, higher than in Zanzibar. This suggests that Mauritius goes for large high budget hotels while
Zanzibar accommodation facilities include all classes, including low budget facilities. Indeed the
10
Most individuals working in tourism industry are non – Seychelles
_______________________________________________________________________________ 81
Mauritian government prefers boutique luxury hotels, 4 and 5 stars beach resorts with golf courses and
spas and beauty centers (Boniface, Brain G.; Christopher P. Cooper, 2001). Moreover, there is a deliberate
policy for creating enclaves of tourists that is segregated from the local population.
Table 5.4: Accommodation Facilities and Average Stay
Country
Occupancy
Rate ( percent)
Number of
Rooms
Number
of Beds
Number of
Hotels
Average Days
of Stay
55
53
84
56
76
5,399
10,553
269
107
91
97
11
10
8.5
10
10
Zanzibar
Mainland Tanzania
Maldives
Seychelles
Mauritius
-
8,667
2,710
10,857
17,333
5,450
21,788
Source: Zanzibar Commission for Tourism (2003); Ministry of Tourism; Leisure and External Communication (2008); Ahmada (2009);
Mauritius Chamber of Commence and Industry (2008); Africa News update (2008), Ahmada (2009); Galen-Marine Lange (2009), National
Statistic Bureau (2008)
Table 5.5 depicts hotel accommodation in Zanzibar in various standards. The table shows that Zanzibar
has all types of hotel accommodations, from five stars hotels to un-graded hotels. The higher the class
of the hotel is the more likely that it is owned by foreign investors, which means also that a great deal of
the income is taken away through repatriation of profit. Conversely, the lower the classification of a
hotel is, the more likely that it would be owned by a Zanzibari, thus ensuring that income accrues to
Zanzibaris.
Table 5.5: Accommodation in Zanzibar by their classes/grades
S/N
1
2
3
4
5
6
Hotel Classes/Grades
1 star
2 star
3 star
4 star
5 star
Non-graded or star hotel
Total
No. of Projects
20
17
11
12
12
197
269
No. of Rooms
351
378
325
755
1,589
2,001
5,399
No. of Beds
653
736
581
1,715
3,390
3,878
10,553
Source: Zanzibar Commission for Tourism (2008)
It must also be pointed out that five stars hotels tend to attract high budget tourists and thus offers
avenue for government to collect more revenue. The reason that Mauritius is doing so well in terms of
government revenues from tourism is because it targets only up-market tourists and discourages small
spending types of tourists. Indeed, the Tourism Development Policy of 2004 stipulates that one of the
aims of tourism in Zanzibar is to encourage low volume of arrivals by targeting high spending tourists
groups.
_______________________________________________________________________________ 82
Box 5.1: Strategies Stipulated by Tourism Development Policy (2004)





Attract and encourage low volume, spending income groups and those who understand the social culture and
natural environment of Zanzibar, who appreciate way of life of the residents.
Improving, orienting and organizing the tourist product in such a way that it conforms to the target markets of
Zanzibar.
Adopting multi-market approach, selecting few markets which will give good returns and minimize diverse
effect on the destination.
Limiting the number of the pre-paid packages at the same time encouraging independent travelers and other
tourism segments.
Reaching the consumer either directly or through the use of agent by using modern communication
technology such as internet, intranet and networking
Source: Zanzibar Tourism Development Policy of 2004
5.3
Tourism and Economic Growth
One of the major objectives of the Vision 2020 is to transform the Zanzibar economy, which is largely
agricultural-based, into an export–led, competitive and dynamic semi-industrial economy by 2020.
Obviously, tourism is already the leading export sector in Zanzibar, thus it has to be one of the corner
stone of this strategy. The Zanzibar Strategy for Growth and Reduction of Poverty (MKUZA) targets
economic growth of at least 10 percent by the end of 2010. To realize this growth, some selected
sectors are earmarked for high growth; one of these sectors is tourism. It is important therefore to
assess how tourism has contributed to growth so far.
Unfortunately it is not easy to delineate the tourism sector from the national income accounts. This is
because tourism is not reported separately anywhere in the national accounts, it is rather subsumed in
many sectors such as hotels and restaurants, various retail trade, and transport. Moreover, there can
be numerous indirect connections between tourism and the rest of the economy through multiplier
effects. To compound the problem tourism sector is not uniformly defined by all organizations. For
example, the ILO uses the term Hotel, Restaurant and Tourism as one sector which includes the
following (ILO 2001);
(a) Hotels, boarding houses, motels, tourist camps, holiday centres;
(b) Restaurants, bars, cafeterias, snack bars, pubs, night clubs, and other similar establishments;
(c) Establishments for the provision of meals and refreshments within the framework of industrial and
institutional catering (for hospitals, factory and office canteens, schools, aircraft, ships, etc.);
(d) Travel agencies and tourist guides, tourism information offices;
(e) Conference and exhibition centres.
In other cases, tourism is simply defined in terms of the category of Hotel and Restaurants in the
National Income Accounts. Indeed, for the case of Zanzibar the Economic Survey, (an annual official
report on the performance of the economy), does not define tourism as a separate activity. The 2005
Tourist Exit Survey of Expenditure found that accommodation accounts for 29 percent of expenditure by
tourists, followed by transport (28 percent) shopping (12 percent) and others (31 percent). It is therefore
_______________________________________________________________________________ 83
not sufficient to use hotels and restaurants as a proxy for tourist sector. Nevertheless Table 5.6 shows
that hotels and restaurants make the largest contribution to the government coffers through taxes and
levies. It is therefore important to look at the trends of share of hotels and restaurants component of the
GDP to assess the extent that this component contributes to the economy.
Figure 5.2 shows the trend of the percentage share of Hotels and Restaurant sector in the GDP since
1991. The Figure shows that this share has been on marginal increase with some fluctuations, but it
mostly hovers around 6 percent of the GDP. The correlation between the contribution of the Hotels and
Restaurants in the GDP and the arrivals of tourists is 0.728. Of course, not much can be inferred from
this correlation because the two variables may simply be affected by a common third variable.
Table 5.6: Contribution to GDP by the Tourism Sector July-March 2007/2008 USD
COLLECTIONS
Vat Restaurants
Vat Tour operators
Hotel Levy
Restaurant levy
Tour operators levy
Airport service charges
Vat hotel
Totals
AMOUNT(TZS)
113,136,042.26
367,791,121.25
3,213,899,440.91
1,228,217,712.41
287,804,363.14
4,491,494,299.00
8,730,289,794.71
18,432,632,773.68
PERCENTAGE
0.61
2
17.44
6.66
1.56
24.37
47.36
100
Source : ZRB 2008
BOX 5.2
“Unfortunately the types of tourism Zanzibar attracts at the moment is to a greater extent of low
quality but with high environmental impact” United Republic of Tanzania (2003) “ Indicative
Tourism Master Plan for Zanzibar and Pemba”, Final Report.
Another way of assessing the contribution of tourism to growth is to look at the correlation between
arrivals of tourism and the GDP. The correlation between the real GDP and the inflow of tourists’ arrival
from 1991 to 2008 is 0.8738. This figure must as well be read with caution; neither figure is stationary,
and thus correlation between the two may be due to a third factor that drives the trend, rather than
causation between the two variables. Rate of growth of the two figures are stationary and thus are
bound to give a more informative picture. The correlation between the growth of arrivals and the growth
of the GDP is 0.0301, which is very small indeed. This may not necessarily mean that there is no
causation between tourism and the GDP; rather, it might be the case that data on tourism are not yet
properly accounted for in the National Income. It is important that Zanzibar launches Tourism Satellite
Account to monitor the performance of tourism in the economy of Zanzibar.
_______________________________________________________________________________ 84
Hotel and Restarurant; % of GDP
4 5 6 7 8
Figure 5.2: Trends of the Share of Hotels and Restaurants in the GDP
1990
1995
2000
Year
2005
2010
Another way of looking at the contribution of tourism to the GDP growth is to extrapolate the figures
obtained from The 2005 International Survey Visitor’s Exit Survey Report prepared by the Bank of
Tanzania and others. In this report, it was estimated that tourists’ expenditure in Zanzibar in 2005 was
US$ 111,358,688.35. The nominal GDP in 2005 was TZS 394.9 Billion, which at the exchange rate that
prevailed then of 1,128, the GDP translates to USD 111,358,688.35. Tourists’ expenditure was thus
very roughly about 31 percent of the GDP, but this figure is bound to include double counting because
GDP must take into account only value added of goods and services at any stage of production. The
number of tourists who visited Zanzibar in 2005 was 125,522. This means that average expenditure per
tourists was USD. 887.17. Assuming that this average expenditure is maintained every year we can get
a projection of annual tourist expenditure and the gross contribution of tourism to the GDP as reported
in Table 5.8. To avoid double counting the information from Lange (forthcoming) which estimated the
percentage of tourism in the GDP can be used; in her study, tourism was found to be 25 percent of the
GDP in 2007, a figure that is 2 percent less than the rough estimates of total tourist expenditure as the
gross percentage of the GDP. If we reduce the series of tourist expenditure as a gross percentage of
the GDP by 2 percent we can get a more realistic estimate of the contribution of tourism to the GDP.
This is reported in the last column in Table 5.7.
_______________________________________________________________________________ 85
Table 5.7: Interpolated Estimates of Tourism Contribution to the GDP
Year
Arrivals
Total Tourist
Expenditure
GDP
Current
Billion
Exchange
rate
GDP (USD)
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
50827
59747
68597
41433
56415
69159
86495
86455
86918
97165
76329
87511
68365
89695
125522
137111
143265
128440
45092189.6
53005746.0
60857200.5
36758114.6
50049695.6
61355790.0
76735769.2
76700282.4
77111042.1
86201873.1
67716798.9
77637133.9
60651377.1
79574713.2
111359352.7
121640765.9
127100410.1
113948114.8
28.2
37.4
48.5
62.0
85.4
111.5
136.4
149.1
165.9
190.5
222.4
256.0
286.6
344.3
394.9
510.0
586.4
747.9
230.0
300.0
402.0
520.0
617.0
597.0
628.0
650.0
773.0
800.0
889.0
946.0
1040.0
1091.0
1127.9
1255.0
1247.0
1197.1
122421344.3
124690496.4
120722411.9
119307591.0
138485992.0
186744158.0
217177619.7
229422079.5
214670441.5
238145213.7
250143805.1
270562272.2
275606818.2
315605441.9
350079970.6
406354380.6
470238925.3
624801395.9
Gross tourist
Expenditure
percent of
GDP
0.37
0.43
0.50
0.31
0.36
0.33
0.35
0.33
0.36
0.36
0.27
0.29
0.22
0.25
0.32
0.30
0.27
0.18
Tourist
Value as
percent of
the GDP
0.35
0.41
0.48
0.29
0.34
0.31
0.33
0.31
0.34
0.34
0.25
0.27
0.20
0.23
0.30
0.28
0.25
0.16
Estimates based on the assumed expenditure of USD. 887.17 per tourist
The estimated series of tourist value as a percentage of the GDP in Table 5.8 must be read with
caution. These are rough estimates that we are forced to rely on because of lack of better data.
Nevertheless, it appears that tourism is a very large component of the GDP indeed. The largest
component of the GDP is service sector which in 2007 constituted 44.1 percent of the GDP. Crops and
Livestock sector contributed 21.5 percent of the GDP. It appears that tourism contributes more to the
GDP than crops and livestock, even though the later employs more people.
There are two avenues for seeking higher GDP growth through tourism. The first avenue involves
increasing promotional and marketing activities to attract more tourists to Zanzibar. Indeed, Zanzibar is
still lagging behind in terms of the tourists’ arrivals as compared to other Islands such as Mauritius,
Maldives and Seychelles. There is no doubt there is still a lot of scope for increasing more tourists to
Zanzibar and thus harness the sector to maximize economic growth.
The second avenue for increasing GDP growth through tourism is to target high spending tourists.
Indeed, Mauritius, which concentrates on high income tourists, generates more revenues per tourists
than Zanzibar. Seychelles, which attracts almost the same number of tourists as Zanzibar manages to
_______________________________________________________________________________ 86
get about ten times more revenues from tourism than Zanzibar. Both Seychelles and Mauritius target
high budget tourists. It is also important that the mechanisms for collecting revenues are strengthening
to minimize cheating.
Another way of relating tourism to the national income is to establish its linkages with the rest of the
economy. If tourism increases demands for locally produced goods, this would increase income and
employment in the economy particularly of the commodities whose demand increases have elastic
supply. If supply is inelastic such an increase in demand may increase the income of producers but
reduce the welfare of the local consumers of the commodity because of the demand-inflicted
inflationary pressure.
Table 5.8 shows the percentage of food items that are sourced locally by tourist hotels. It is clear that
the strongest link that the tourist industry maintains with the rest of the economy is that of purchase of
fish and other sea foods, fruits, herbs and spices and poultry. The implication of increased demand for
fish is to price out the local consumers from this important source of protein in Zanzibar. Some
evidence indicates that indeed fish price increase at the peak season of tourism. This may have
adverse repercussion to local consumers of fish, but it may also increase the income of fishermen.
Table 5.8: Share of Fresh Foods Locally Sourced by Hotels and Restaurants
Fresh food Item
Fish and seafood
Fruits
Herbs and spices
percent Sourced
in Zanzibar
(estimate)
90 percent
80 percent
60 percent
Poultry
Vegetables
Meat (excluding poultry)
50 percent
20 percent
10 percent
Milk and Milk Products
5 percent
Honey
Jams, pickles, chutneys
Staples
(cereals,
potatoes, cassava, sweet
potato)
5 percent
5 percent
2 percent
Comments
Some shellfish bought from Mainland Tanzania.
Some seasonal imports from Mainland Tanzania and Kenya.
Most spices and spice mixed are abundantly available in
Zanzibar.
Same source as eggs; concerns about food safety.
Bulk of supply comes from Mainland and Kenya.
No intensive livestock rearing or abattoirs on Zanzibar; plans to
establish Disease Free Zones may bring changes.
Most hotels buy UHT milk from Mainland, Kenya or South Africa;
local milk quality considered doubtful.
No honey collection and processing centre in Zanzibar.
No effective local fruit and vegetable processing centre.
Most hotels assume that tourists want European staple foods
which are little grown in Zanzibar.
Source: BESO Report, March 2002
5.4
Distribution of Benefits from Tourism
_______________________________________________________________________________ 87
Naturally growth without proper distribution may not achieve the level of human development that could
potentially be achieved. It is therefore important to assess the extent that tourism impinges on income
distribution and poverty. There are several ways through which tourism can impinge on poverty and
income distribution;
(a)
Ownership of enterprises that cater for tourism can have impact to growth and income
distribution. A particular aspect here is the structure of ownership between local and foreigners.
Local ownership has a higher multiplier effect in the economy than foreign ownership because
of profit repatriation. However, foreigners are better placed to establish top class hotels
because they tend to have the necessary capital, the entrepreneurial skills and the business
connections; the local investors are yet to reach this level of business proficiency.
(b)
Direct impact on the poor. This can be transmitted through wage income, other forms of
tourism incomes and non-monetary livelihood change.
(c)
Indirect impact on the poor; this can be transmitted through inflationary pressure, including
increased in land prices for speculative purposes, earnings from non-tourist sector that is
however influenced by tourism such as prices of food crops, and multiplier effect through the
expansion of employment and attendant increase in demand. Environmental changes due to
tourism may also have impact on the welfare of the poor people.
(d)
Government interventions by using revenues collected from tourism to fund pro-poor programs.
The structure of ownership of tourists related projected approved by ZIPA in 2008 is very revealing.
Investors from Zanzibar have the highest number of projects, followed by Italians. Foreign ownership of
hotels contributes in terms of bringing in international standards and exploit international network to
bring in more tourists. Local ownership of hotels is useful because it ensure most benefits from tourism
remain within Zanzibar.
_______________________________________________________________________________ 88
Table 5.9: Distribution by Nationality of Projects Approved by ZIPA 2008
Country
Australia
Bahrain
Belgium
Canada
Congo (Rep.)
Denmark
Holland
France
Germany
India
Israel
Italy
Kuwait
Lebanon
Mauritius
Norway
Oman
Poland
South Africa
Saudi Arabia
Spain
Sweden
Swiss
Tanzania Mainland
Tanzania Zanzibar
UAE
USA
UK
Yugoslavia
Zimbabwe
TOTAL
Approved
projects
Operating
projects
1
1
0
1
0
1
2
2
5
1
1
17
1
1
5
1
3
3
12
1
2
2
0
9
23
2
1
13
3
1
Cancelled
projects
2
1
1
1
1
0
1
2
0
0
6
1
1
0
0
1
0
1
0
1
0
0
0
0
1
0
0
0
0
0
0
0
2
0
0
0
1
0
0
2
1
3
1
1
4
0
0
0
0
0
0
0
5
0
0
Projects under Estimated cost of
construction
projects (USD)
404,800
12,500,000
439,000
1,310,100
6,000,000
4033,050
3,000,000
8,601,243
17,757,165
60,000,000
1
4,000,000
1
128,151,331
0
65,000,000
0
3,670,000
0
32,980,200
0
1,030,000
0
40,505,000
1
26,700,500
0
186,267,578
0
4,000,000
0
9,917,000
44,553,051
0
376,159
0
27,495,200
0
495,32,390
0
332,938,052
0
1,019,000
2
100,535,509
0
12,604,670
0
3,201,000
1,138,989,608
Source: Zanzibar Investment Promotion Authority (2008)
_______________________________________________________________________________ 89
Another area in which benefits of tourism can be re-distributed to the people is through employment.
One of the most notable feature of tourism is that is offers employment to a high proportion of women
and it also employ a number of unskilled workers. Lange (forthcoming) estimated 40 percent of
employees in the tourists hotels in Zanzibar are women. Tourist sector also tends to employ low skill
labor (ILO 2001), thus generating employment to the poor
Table 5.10: Percentage of Population (15-64 Years) who’s Main Activity is Tourism
DISTRICT
Kaskazini A
Kaskazini B
Kati
Kusini
Magharibi
Mjini
Wete
Micheweni
Chake Chake
Mkoani
Over all
TOURISM
0.3
0.9
0.3
0.6
0.5
0.5
0.1
0.0
0.1
0.1
0.4
FARMING &LIVESTOCK FISHING
37.3
34.7
39.0
21.2
9.3
2.1
36.2
48.8
35.3
49
24.1
11.3
4.1
3.7
7.9
1.6
0.8
4.9
9.1
2.3
4.8
3.9
Source: RGZ (2006) 2004/05 Household Budget Survey, Final Report.
Table 5.10 shows that tourism generates very little employment. In spite of the fact that tourism
contributes about 25 percent of the GDP, the percentage of the people who are employed in the sector
for the whole of Zanzibar is 0.4 (as compared to 24.1 in farming and livestock keeping and 3.9 in the
fisheries). The district with the highest percentage of people employed in tourism industry is Kaskazini
B. It is clear that tourism does not generate mass employment and that even expansion of tourism in
Zanzibar would not create a significant increase in employment. This fact is important in designing
tourism policy in that if tourism is not expected to generate significant employment opportunity, it is
important to focus on maximizing revenues from tourism, rather than focus on employment creation.
This means that more effort need to be directed in attracting large scale up-market tourism by using
large five stars hotels, rather than expanding low budget tourism which on its face may appear to create
more employment but does not generate sufficient revenue to government.
The trend in the tourist hotels is that high skills labor is sourced from outside the community in which
the hotel is located and a very high proportion of high skilled labor is sourced from outside Zanzibar and
even outside Tanzania. This tends to generate some hostility because benefits from tourism are
enjoyed by outsiders. The way to solve this problem is not through direct interference in the labor
market. The government can introduce training levy on such hotels and use the fund to train more
Zanzibari on hotels management skills. Tunisia has succeeded greatly through this process.
_______________________________________________________________________________ 90
Tourism imposes some costs to the local communities even when these communities do not directly
benefit from such tourism. One example of this cost is enclosure to beaches that was accessible to the
local people. Most tourists hotels are build along the beach and admission to the beach is then
restricted to clients of the hotels. If this continues without proper plan soon most of the beaches would
be inaccessible to Zanzibaris. There is a need to have a policy that guides allocation of plots to tourists’
hotels, and a mechanism to ensure that this policy is implemented.
Lange (forthcoming) conducted a survey that shows that mid-range and budget tourism generates the
highest direct benefits to Zanzibari than up-market tourism or all-inclusive-club tourism. She showed
that 89 percent expenditure by budget tourists goes directly to individual Zanzibaris, while less than 30
percent of the expenditure by large scale up-market tourists goes directly to individual Zanzibaris. She
also showed that Large-scale up-market tourism has the largest share of contribution to the GDP while
mid-range, budget, and all-inclusive club tourism have the least contribution to the GDP. Focusing on
budget tourism can ensure more re-distribution in favor of Zanzibaris but would not generate as much
benefits as up-market tourism. A focus on up-market tourism must also involve deliberate efforts by the
government to maximize its share of revenue and use it to promote human development of Zanzibari’s
as a whole.
5.5
Some Policy Issues
There is still a large scope for expanding tourism in Zanzibar. Zanzibar is arguably the most attractive
tourist destination among the Western Indian Ocean Islands. Its pristine and shimmering beaches, the
exotic spice tour, the breathtaking marine environment, the numerous historical sites makes Zanzibar
uniquely appealing. Zanzibar is peaceful with a stable government and it is conveniently located near all
major airline hubs in the region. Zanzibar is close to Tanzania Mainland, a safari destination that boasts
the largest animal sanctuary in the world, which means that Zanzibar can offer a package that
combines a safari and beach holiday that is unparalleled to any other island nation in the Indian Ocean.
This potential can be exploited to attain high growth and improve human development of Zanzibar.
Unfortunately not much is known about the contribution of tourism to the GDP and the extent of its
multiplier effect. Without this knowledge it would not be possible to design informed policy. There is a
need to launch tourism satellite account for Zanzibar to be able to monitor the contribution of tourism to
the economy of Zanzibar. Further, statistical data on tourism needs to be improved to ensure that
statistical information is readily available for monitoring and evaluation.
There is some evidence that tourism has contributed significantly to growth in Zanzibar, and that it
contributes about 25 percent of the GDP. Even though it is clear that the share of tourism in the GDP
can be substantially increased, strategy must be put in place to ensure that revenue from tourism is
used to diversify the economy to avoid over-reliance on tourism in the long run- tourism is prone to
unexpected shocks that can have devastating impact on the economy.
_______________________________________________________________________________ 91
A salient feature of tourism in Zanzibar is that even though it contributes about 25 percent of the GDP, it
does not generate significant direct employment. The 2004/05 Household Budget Survey shows that
the percentage of people whose main activity is tourism in Zanzibar is only 0.4, which is indeed very
small. It does not appear that expansion of tourism would create mass employment. It appears
therefore that rather than consider tourism as an avenue for generating mass employment, it should be
considered as an avenue for generating revenue that can be used to diversify the economy and thus
indirectly contribute to employment creation in other sectors. Even then, there is a need to introduce
training levy on tourist hotel to be used to train Zanzibaris in hotel management so as to ensure high
skills employment opportunities in the tourist sector benefit the Zanzibaris too.
Studies have shown that low budget tourism tend to have direct benefit to local people but does not
generate as much benefits either in terms of the share to the GDP or through revenue generation to the
government. Up-market tourism does not generate as much direct benefits to Zanzibari because most
high class hotels in which these tourists stay are not owned by Zanzibaris. However, up-market tourism
generates more revenue to the government and thus creates capacity to fund human development
programs. Mauritius and Seychelles generate more revenue per a tourist than Zanzibar because of
focusing on up-market tourism. Indeed Mauritius and Seychelles out-perform Tanzania in terms of
human development index by far mostly because of higher per capita income that allows funding of
human development programs. There is a need for Zanzibar to put more effort in attracting up-market
tourists and reduce as much as possible budget tourists.
Strategy to attract up-market tourism must include development of conference facilities of international
standards to attract conference tourism, and through encouraging investment into large high class
hotels with golf course, spa and other attractions. One step that needs to be taken in this direct is to
withdraw land lease for hotel construction on all land that is idle but being held speculatively so that
more serious investors can be encouraged to step in. Secondly the government need to insist that any
new hotel has to be five star and large enough to cater for up-market large tourism. The Zanzibar
International Airport must also be upgraded to handle larger traffic and improve its standard. In order to
attract more up-market tourism, it is important also to reform the financial and insurance institutions to
meet international standards and improve health services to international standards both for the benefit
of the population and tourists.
While it is easy to lament lack of employment opportunities for Zanzibaris in the tourists hotels it is more
difficult to take measures to ensure that proper training is given to Zanzibaris to qualify for these jobs.
Deliberate efforts need to be put in place to train Zanzibaris on hotel related activities, including
management, languages, food and beverages and so on up to international standards. Institutions that
are currently offering this training in Zanzibar and Tanzania in general need to be inspected regularly to
ensure quality and a condition for obtaining international accreditation must be imposed. Scholarships
to train Zanzibaris abroad on hotel management need also to be established.
_______________________________________________________________________________ 92
Domestic tourism should not be neglected; it can be used as an avenue for attracting less disruptive
budget tourism. Domestic tourism can be easier to handle because there is no language and cultural
barriers. Even though domestic tourism generates no foreign exchange to Zanzibar it may engender
income re-distribution from the middle class to the poor. Besides, domestic tourism in Zanzibar may
involve a significant flow of middle class tourists from Tanzania Mainland thus ensuring that money
flows to the economy of Zanzibar from the rest of Tanzania.
_______________________________________________________________________________ 93
CHAPTER 6: Micro, Small and Medium Enterprises (MSMEs)11 in Zanzibar: Is it an
Exit Valve out of Poverty?
6.1
Introduction
This investment climate assessment of the micro, small and medium enterprises (MSMEs) is based
upon an analysis of data collected in Unguja and Pemba Islands. The survey was conducted between
June and July 2009 by a team of researchers of the Zanzibar Institute of Financial Administration
(ZIFA). In addition to data from this survey, the literature review, the assessment draws upon additional
data including similar surveys on firms in the manufacturing, tourism, agriculture and construction
sectors in Tanzania Mainland collected in 2003. A structured questionnaire was circulated to a total of
100 MSMEs in Unguja and Pemba out of which 54 firms responded.
This chapter looks at the performance and prospects of the business enterprises (MSMEs) in terms of
its role in economic growth and poverty reduction in Zanzibar. A comparison has also been made with
similar indicators and/or measures in Tanzania Mainland, Kenya, and Uganda12. The regional
comparators, Tanzania Mainland, Kenya and Uganda, are chosen because of their geographic
proximity to Zanzibar, their joint membership of the East Africa Community, and because similar
MSMEs investment climate surveys were completed not very long during 2009 in the three countries.
These countries therefore provide a useful benchmark for the long-term improvements that Zanzibar
might be able to achieve if it improves its investment climate.
6.2
Review of the Status and Role of MSMEs in Zanzibar
6.2.1 Status of MSMEs
Definition of informal sector has continued to be controversial and sometimes confusing because it has
been difficult to get a clear-cut boundary of what constitute formal and informal sectors (RGoZ 2006).
According to the International Conference of Labour Statistics (ICLS) in RGoZ (2006), informal sector
consists of units engaged in production with the primary objectives of generating employment and
incomes to the persons concerned. These units typically operate at a low level of organization, small
scale, and with little or no division between labour and capital. Labour relations are characteristically
based on casual employment, kinship or personal and social relations rather than contractual
arrangements with formal guarantees.
Result of the Zanzibar Business Census (RGoZ 2004) show that there were 15,192 informal sector
operators employing 67,526 persons (See Table 6.1). Urban West (Unguja) hosts more than 50 percent
of the total enterprises as recorded in both central register of establishment and the business census.
Unguja West is followed by South Region (Pemba) with 16 percent and 13 percent of the total
11
12
MSME stands for Micro, Small and Medium Enterprises
These measures include labour productivity, constraints to investments, human capital, capital-labour ratio, efficiency etc
_______________________________________________________________________________ 94
establishments respectively. South Region (Unguja) has the least number of the businesses. Table 6.1
presents the number of established businesses by region. The Integrated Labour Force Survey (ILFS
2006) reported that a total of 144,147 persons were engaged in the informal sector, which is a change
of about 113 percent from 2004.
Table 6.1: Number of Business by Region
Number of Businesses
Region
Central Register of
Establishments
North Region (Unguja)
1,395
South Region (Unguja)
919
Urban West (Unguja)
6,103
North Region (Pemba)
1,759
South Region (Pemba)
1,896
Total
12,072
Source: 2004 Zanzibar Business Census (RGoZ 2005)
percent of
Total
12
8
51
15
16
100
Business
Census
1,753
1,256
8,570
1,581
2,032
15,192
percent of
Total
12
8
56
10
13
100
Distribution of businesses by district is presented in Table 6.2, which shows that more businesses in
Zanzibar are operating in Urban district, followed by West district. North B, Central, South and
Micheweni districts have the least number of enterprises which also reflects the level of poverty. Using
the 2007 Household Budget Survey, Micheweni, Wete, Chakechake, North B, and South are the most
deprived districts.
Note also that, both the business register and business census show that Unguja hosts more
enterprises (about 70 percent of the total) than Pemba. With regard to the diverse nature of activities in
the informal sector, records show that the majority of activities are concentrated in trade; wholesale and
retail business (65 percent), followed by manufacturing (12 percent) and hotel and restaurants attracted
only 8 percent of the business activities. MSMEs engage about 4 percent in community and personal
services while other sector attracted only11 percent.
Regarding distribution by number of workers, out of 15,192 businesses 93 percent employ less than 10
persons (See Tables 6.2 and 6.3). About 71 percent are micro employing less than three persons, 16
percent of businesses employ 3 - 4 persons, 7 percent businesses employ 4 - 9 workers and 6 percent
employ more than 10 persons. Table 6.3 presents the distribution of businesses by size of workers.
_______________________________________________________________________________ 95
Table 6 2: Number of Businesses by District
Districts
North A (U)
North B (U)
Central (U)
South (U)
West (U)
Urban (U)
Total Unguja
Wete (P)
Micheweni (P)
Chake Chake (P)
Mkoani (P)
Total Pemba
Total
Central Register of
Establishments
976
419
500
419
1,662
4,441
8,417
1,083
676
1,099
797
3,655
12,072
Number of Businesses
percent of Total
Business
Census
8
1,215
3
538
4
780
3
476
14
2,885
37
5,684
70
11,578
9
902
6
679
9
1,145
7
888
30
3614
100
15,192
percent of Total
8
4
5
3
19
37
76
6
4
8
6
24
100
Table 6.3: Distribution of Businesses by Region and Size of Workers
Regions
North U (1,753)
South U (1,256)
Urban/West (8,570)
North P (1,581)
South P (2,032)
1-2
71 percent
67 percent
68 percent
78 percent
74 percent
Businesses by Size of Workers
3–4
4-9
10+
16 percent
06 percent 06 percent
16 percent
08 percent
9 percent
18 percent
12 percent
05 percent
5 percent
14 percent
Total
99 percent
100 percent
100 percent
100 percent
99 percent
Regarding ownership status of businesses, it is indicated in the business register that majority of
businesses are family owned (78 percent). A similar pattern was observed in 2004 Business Census
(91 percent). As we shall see later, the same pattern is evident today (See Table 6.4 below).
_______________________________________________________________________________ 96
Table 6.4: Number of Businesses by Ownership and percent Change
Central
Ownership Status
Register
Wholly or mostly government owned or financed
842
Cooperatives
263
Family Business
9,416
Others
1,551
Total
12,072
percent of
Total
7
2
78
13
100
Business
Census
808
196
13,859
329
15,192
percent of
Total
5
1
91
2
100
6.2.2 Contribution of MSMEs
Informal sector’s and MSMEs contribution to employment generation and improved livelihood of
families has drawn a significant attention of both researchers and policy makers in most of the
developing countries including Zanzibar. It is widely accepted that the micro, small and medium size
enterprises (MSME) sector has the potential to provide livelihood for a considerably large number of
people in least developing countries like Zanzibar and others in the region. In Zanzibar, micro
enterprises are considered the sanctuary and sphere of the many poor in both rural and urban area for
their livelihood. Studies confirm that a larger proportion of the Zanzibar population engaged in a wide
variety of economic activities depends on MSMEs as a source of income for their survival (HBS 2005,
Ussi 2009).
Indeed, MSMEs in Zanzibar is a potential gateway towards economic growth and an exit valve out of
poverty. Though data on the MSMEs sector are rather sketchy and unreliable, it can be concluded
using anecdotal information and data analyzed below that MSMEs sector plays a crucial role in the
economy of Zanzibar. Since MSMEs tend to be labour-intensive, they create employment at relatively
low levels of investment. At present, unemployment is one of the serious problems that Zanzibar has to
deal with. Estimates show that there are a huge number of new entrants into the labour force every
year, most of which are school leavers with few marketable skills (RGoZ 2008). The public sector
employs an insignificant number of the new entrants into the labour market, leaving the majority to join
the unemployed or the underemployed reserve. Most of these persons end up in the MSMEs sector,
and especially in the informal sector. Given this trend and the fact that Zanzibar is characterized by low
rate of capital formation, MSMEs are the most relevant option to address this problem.
MSMEs are instrumental in terms of adding value to local resources. In addition, development of
MSMEs facilitates distribution of economic activities within the economy and thus fosters equitable
income distribution.
MSMEs technologies are easier to acquire, transfer and adopt. As we shall see, MSMEs are better
positioned to satisfy limited demands brought about by small and localized markets due to their lower
overheads and fixed costs. Moreover, MSME owners tend to show greater resilience in the face of
_______________________________________________________________________________ 97
recessions by holding on to their businesses, as they are prepared to temporarily accept lower
compensation (Olomi 2006).
Through business linkages, partnerships and subcontracting relationships, MSMEs have great potential
to complement large industries requirements (See also Bank of Tanzania 2009). A strong and
productive industrial structure can only be achieved where MSMEs and large enterprises not only
coexist but also function in a symbiotic relationship. In addition, MSMEs serve as a training ground for
entrepreneurship and managerial development and enable motivated individuals to find new avenues
for investment and expanding their operations.
6.2.3 Profile of Workers, Markets and Efficiency of the Enterprises
Table 6.5 presents total number of workers by the specified categories over the period of three years
(2007, 2008 and 2009). As can be depicted from the table the total number of workers employed by the
sampled business firms has increased by 12 percent between 2007 and 2009. While the number of
female workers has also increased by 15 percent, the number of workers below 18 years of age has
dropped by about 70 percent which could be reflecting the Government’s emphasis on education for all
school age children and the fact that child labour is prohibited in Zanzibar.
It is evident also from the survey data that, most MSMEs in Zanzibar are operated by members of the
family (relatives). Throughout the period under review about 50 percent of the total labour force is
drawn from the family members. It was reported by some respondents that, most of the business
owners can not afford to put up a professional management to manage their businesses. Thus, their
systems are weak with too many loopholes. It therefore becomes necessary to employ relatives to
strengthen security of assets. The increase in female workers portrays the real situation in Zanzibar.
Table 6.5: The Profile of Workers
Categories of Workers
Total No of Workers
Relatives or HH Members
Female Workers
Under 18
2007
187
91
68
28
percent
of Total
100
49
36
15
2008
219
116
76
27
percent
of Total
100
53
35
12
percent
of Total
2009
210
124
78
8
100
59
37
4
percent
Change
12
36
15
-71
Source: Computed from the Survey Data
In the face of rapid demographic changes and various environmental and economic changes, micro
enterprises and in particular women enterprises have become a necessary fall back alternatives and
safety nets for many households in both rural and urban areas of the islands of Zanzibar. More women
are engaged in MSMEs today than they used to be in the past.
_______________________________________________________________________________ 98
The surveyed businesses can be categorized in three different types of enterprises based on the
number of employees and size of the capital invested. The sampled businesses do not include Large
Scale Enterprises. Out of 54 surveyed establishments, 26 are micro enterprises (with 1 to 4
employees), 24 are small scale enterprises (with 5 to 19 employees), and only 4 are medium scale
firms (with 20 to 99 employees). Majority of private enterprises therefore are micro and small sized
units. The biggest segment is micro classified as having less than 4 employees and/or having a capital
investment of up to TZS 5m. These are found in every corner of the country, trading mostly in
essentials such as foodstuffs, beverages, daily household consumables, Over-the-Counter (OTC)
medicines, clothing and footwear, stationery, building materials, motor spare parts and fuel.
Figure 6.1: The Establishments’ Sales to Various Markets ( percent)
Large BusinessesOthers
Small Businesses
4%
2%
10%
Traders
13%
Individual Consumer
71%
Source: The Survey Data
MSMEs in Zanzibar do not appear to take significant share in the export market as the quality of
services and products they produce have been less competitive. They mainly depend on domestic
market and sell their products mostly to individual consumers (about 70 percent of the sampled
establishments).
About 13 percent of the enterprises sell their products to traders and merchants intermediaries, while
only 10 percent and 4 percent of the businesses sell the products to small and large businesses
respectively (See Figure 6.1). This is an indication that MSMEs in Zanzibar have poor forward and
backward linkages which is disquieting. Their integration with large scale firms is low which limits their
efficiency and competitiveness. The integration of MSMEs needs to be improved if the enterprises in this
category are to be transformed. MSMEs should be processing raw products for the large scale
manufacturers to consume as raw materials. This is the strategy which other middle income countries in
the east such as China and to a larger extent Japan have been using overtime. Such integration has
_______________________________________________________________________________ 99
prompted the giant large scale business firms to improve the capacity of MSMEs in terms of technology,
standards and quality of products and services.
6.2.4. Constraints on Enterprise Operations and Growth
Enterprise productivity differs between countries for a wide range of reasons. One of the objectives of
this study is to identify factors that affect productivity. As a starting point in this analysis, the survey
asked enterprises whether they rated various problems as no obstacle, a minor obstacle, a moderate
obstacle, a major obstacle, or a very severe obstacle to their operations and growth.
Figure 6.2: Major Obstacles to Enterprise Operations and Growth
70
67
59
60
57
48
50
40
% of
Respondents 30
35
33
31
37
20
10
0
El
TR
TA
SE
FA
CF
EPU
MA
Obstacles
Key: El = Electricity, TR = Tax Rate, TA = Tax Administration, SE = Skills and Education of Available Workers, FA = Access
to Financing, CF = Cost of Financing, EPU = Economic Policy uncertainty, MA = Access to or Availability of Markets
Additional quantitative data, such as the number of power outages, crime rate and amounts enterprises
report paying in bribes, were also investigated. Figure 6.2, Figure 6.3 and the appendix Table C6.2
present results from these questions. While figure 6.2 shows the percentage of enterprises that rated
various constraints as a major obstacle, figure 6.3 presents the percentage of enterprises that rated
constraints as a severe obstacle to enterprise operations and growth. Electricity, skills and education
rank higher as major obstacles to enterprise operations and growth (Figure 6.2), while tax rate, customs
and trade regulations, as well as corruption also rank higher as very severe obstacles to the enterprise
operations and productivity in Zanzibar (Figure 6.3). Enterprises were most likely to rate constraints
associated with taxation, the power supply, skills, regulations and corruption as major or very severe
obstacles. These are critical determining factors for investment in Zanzibar. Enterprises appear most
concerned about these factors: 67 percent of enterprises rated electricity and 57 percent rated skills
and education as a major obstacle. Likewise, 7 percent of the enterprises ranked each, the tax rate, tax
administration, and corruption as a very severe obstacle.
_______________________________________________________________________________ 100
Cost of financing, access to or availability of markets, and access to finance were also mentioned as
critical problems. About 48 percent of enterprises reported that the cost of financing was a serious
problem and 37 percent reported that access to or availability of markets was serious problem. One of
the reasons why the informal enterprises are not motivated to be formalized is the fact that, it is
extremely costly to be formalized in Zanzibar. Formalization will subject one to a huge transaction costs
such as taxes, corruption, and customs and trade regulations.
Figure 6.3: Very Severe Obstacles to Enterprise Operations and Growth
7
7
7
7
6
6
6
5
4
% of
Respondents 3
4
4
4
4
2
1
0
AL
TR
TA
CTR
SE
FA
CF
EPU
Co
Obstacles
Key: AL = Access to Land, TR = Tax Rate, TA = Tax Administration, CTR = Customs and Trade Regulations, SE = Skills
and Education of Available Workers, FA = Access to Financing, CF = Cost of Financing, EPU = Economic Policy
uncertainty, and Co = Corruption
6.2.5. Country Comparative Analysis
The investment climate for selected countries was also compared to understand how these obstacles
affect different countries, and draw lessons from the experience of individual countries. Figure 6.4
compares tax rate and overall tax administration for four countries namely, Zanzibar, Tanzania
Mainland, Uganda, and Kenya. Within Zanzibar, the island of Unguja is also compared to Pemba.
Generally the findings show that, a high percentage of businesses regard taxation as a major obstacle
to investment growth and business operations. It implies that enterprises are much more concerned
about taxation13. This is particularly true for Tanzania where about 73 percent and 56 percent of the
enterprises (MSMEs) assert that tax rate and tax administration respectively are the leading obstacles
to businesses in the country. This is followed by Kenya with 68 percent and 51 percent of the sampled
enterprises indicating that the tax rate and tax administration respectively are the most adverse factors
to investment and businesses in Kenya. The respective findings for Uganda and Zanzibar are 56
percent and 35 percent, and 28 percent and 38 percent. Although perceptions data across comparator
countries were collected in different years, it provides a useful comparison on some dimensions. First,
13
These are taxes imposed to the business firms.
_______________________________________________________________________________ 101
the major constraints and extent of perception are more or less similar in the comparator surveys (See
also Figure 6.5). With the exception of Zanzibar, high tax rates rather that tax administration is seen as
a major problem in all cases. Likewise power followed by transport appear to be the leading constraints
in all the comparator countries, whereas in Zanzibar and Tanzania Mainland they appear to be most
severe compared to other comparator countries (See figure 6.5).
Figure 6.4: Tax Rate and Tax Administration: Country Comparison
80
73
68
70
60
56
% of Respondents 40
30
20
51
48
50
38
36
35
50
28
33
26
Tax Rate
Tax Admn
10
0
ZnZ
TaM
Ug
Ke
Un
Pe
Key: ZnZ = Zanzibar, TaM = Tanzania Mainland, Ug =Countries
Uganda, Ke = Kenya, Un = Unguja, Pe = Pemba
Quantitative data from SME and Tourism development survey in Zanzibar (Mussa 2009), and a survey
of the manufacturing sector in Zanzibar (BOT 2009) support the idea that tax rate and administration
are particularly burdensome in Zanzibar (See also World Bank 2006). Enterprise managers in Zanzibar
have negative perception on the current tax regime. They are concerned with high tax rates, multiplicity
of taxes and tax authorities. The high tax rates increases production cost and hence erodes profits and
discourages investments of the enterprises. The World Bank (2006) also observes that management of
the enterprises spent about seven days dealing with inspections or required meetings with officials from
the tax inspectorate in 2002/03 compared to 2 – 3 days reported by managers in Kenya, Uganda, and
China.
Tanzania (which includes Zanzibar) is not competitive compared to some Sub-Saharan African
countries despite the fact that its investment climate has improved in the last decade or so (World Bank
2006, ESRF 2007). The high-cost of electricity, poor roads, high transportation costs, poor
communications, and a largely-agrarian labor force lacking the skills, training, or work experience
required by modern, private enterprises are said to be among the major factors affecting performance
of the enterprises in the country. As noted earlier, Figure 6.5 shows clearly that businesses are more
concerned about power and transport costs which lead to high cost of doing business thus discouraging
investments in the respective countries. This problem is particularly serious in Zanzibar and Tanzania
Mainland. Kenya and Uganda take the third and fourth rank (See figure 6.5). This pattern is not
significantly different from the pattern in Figure 6.4 where Tanzania Mainland takes the lead, followed
by Kenya, Uganda and finally Zanzibar.
_______________________________________________________________________________ 102
The Revolutionary Government of Zanzibar needs to work towards reducing the burden that tax rate
and tax administration impose upon enterprises, rather than focusing on tax reforms which are geared
towards improving compliance alone. In other words, compliance should not be the only important goal
of the reforms if fiscal rationalization has to be achieved.
Labour productivity is another indicator selected for assessing performance of the enterprises in
Zanzibar. Although Total Factor Productivity (TFP) is a more robust indicator for this assessment, only
labour productivity and capital input ratio are used here to indicatively gauge the efficiency of
enterprises in Zanzibar. Labor productivity is defined as the value of sampled enterprises’ sales per
employee in 2008. While Figures 6.6 presents the results on labour productivity for four countries
(Zanzibar, Tanzania Mainland, Kenya and Uganda), Figure 6.7 presents capital – output ratios for the
various enterprises under study.
Figure 6.5: Telecommunication, Power and Transport
80
70
60
67
59
74
67
59
50
44
% of Respondents 40
30
23
49
44
37
9
Power
25
23
Transport
20
10
Telecommunication
13 13
12
5
9
0
Zn
TaM
Ug
Kn
Un
Pe
Countries
Key: ZnZ = Zanzibar, TaM = Tanzania Mainland, Ug = Uganda, Ke = Kenya, Un = Unguja, Pe = Pemba
As can be observed from the figures, despite the fact that findings for Zanzibar are based on 2009 data
while findings for other countries are based on 2002 data, in Kenya enterprises produce more per
worker than it is the case in other comparator countries namely Zanzibar, Tanzania Mainland and
Uganda. On the other hand labour productivity was on average USD 3,214 in Kenya, USD 2,028 in
Tanzania Mainland, and USD 960 in Uganda in 2002 while it is equivalent to USD 1,557 in Zanzibar in
2009. A range of factors are said to be influencing labour productivity in the MSMEs. They include the
different constraints discussed earlier as well as export performance and technological level, among
others. Thus, to improve enterprise productivity in Zanzibar, RGoZ has to address the major
constraints presented earlier such as power supply and tax administration.
_______________________________________________________________________________ 103
The capital – output ratio was calculated and used as a proxy for 2008 enterprise efficiency in Zanzibar
for the 28 enterprises. The ratio for each enterprise was thereafter plotted in a graph as revealed in
figure 6.7. This ratio defines the total annual sales’ share of the enterprise annual capital investment.
The assessment criteria is such that when the ratio is above 100 percent it implies that value of the
enterprise annual capital investment is higher than the annual revenue generated by the enterprise, and
therefore the enterprise’s performance is poor i.e. it does not operate efficiently as its total annual
output can not recover the total annual capital invested. This ratio implies therefore that, the lower the
capital – output ratio, the higher the efficiency.
Figure 6.6: Labour Productivity
3,214
3,500
3,000
2,500
2,000
USD
2,028
1,557
1,500
960
1,000
500
0
ZnZ (2009)
T-M (2002)
Ug (2002)
Ke (2002)
Countries
Key: ZnZ = Zanzibar, T- M = Tanzania Mainland, Ug = Uganda, Ke = Kenya
Judging from the pattern of the graph in Figure 6.7, out of 28 enterprises, only one recorded 175
percent ratio which shows that the annual capital invested is 175 percent of the revenue generated.
This is an indication of a loss making enterprise. This is followed by another firm whose capital – output
ratio is 80 percent. All the remaining enterprises entail a less than 50 percent ratio (See Figure 6.7 and
appendix table C6.3).
Despite a number of constraints affecting MSMEs growth and operations in Zanzibar, performance
indicators show that the enterprises in Zanzibar encompass high growth potential. MSMEs sector is
therefore one of the growth drivers for Zanzibar given the existing potential and if meaningful efforts are
made to address and eliminate major constraints affecting the sector.
_______________________________________________________________________________ 104
Figure 6.7: Enterprise Efficiency: Capital – Output Ratio
200
Capital-Output Ratio
180
160
140
120
100
80
60
40
20
0
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28
Individual Enterprises
6.2.6 Major Conclusions and Recommendations
This paper was intended to look at the performance and prospects of the business enterprises
(MSMEs) in terms of its role in economic growth and therefore poverty reduction in Zanzibar. A total of
six conclusions can be made based on the proceeding analysis.
MSMEs Geographical Distribution
Both the business central register as well as business census show that Unguja is home for most
enterprises compared to Pemba. About 70 percent of the total enterprises in Zanzibar operate in
Unguja, while only 30 percent are in Pemba. In terms of regional distribution, the Urban West which is
in Unguja is hosting about a half of the total MSMEs in Zanzibar. Urban West is followed by South
Region in Pemba with approximately 15 percent of the total enterprises. North region in Pemba and
North region in Unguja have about 12 percent each. The most attractive district for MSMEs is Urban
District in Unguja with 37 percent of the total businesses, followed by West District in Unguja and
Chakechake District in Pemba with approximately 16 percent and 8 percent of the total businesses
respectively. Micheweni, South, and North B Districts are the most deprived districts in terms of the
number of businesses. MSMEs in Zanzibar are dominated by the micro-enterprises with between 1 and
2 employees (72 percent).
Recommendation 1
Power and transportation are among the obstacles to investment in most of the countries under review.
Indeed, one of the disincentives to investors has been availability and cost of energy and transportation.
There is a need to improve the quality and quantity of the infrastructure in Pemba in order to attract
more investors and ensure equity. The pace which the RGoZ has shown during the past three years to
improve the road network in Pemba therefore needs to be maintained.
_______________________________________________________________________________ 105
Ownership, Employment and Contribution of MSMEs in Zanzibar
Both the business register and business census indicate that majority of businesses (MSMEs) are
owned by families. This is mainly intended to ensure security of assets as well as a means of
minimizing operating costs.
The total number of workers employed by the sampled business firms has increased by 12 percent
between 2007 and 2009. While the number of female workers has also increased by 15 percent, the
number of workers below 18 years of age has dropped by about 70 percent which could be reflecting
the Government’s emphasis on education for all school age children and the fact that child labour is
prohibited in Zanzibar.
MSMEs have the potential to provide livelihood for a considerably large number of people in Zanzibar
and other countries in the region. Since MSMEs tend to be labour-intensive, they create employment at
relatively low levels of investment. In addition, MSMEs are better positioned to satisfy limited demands
brought about by small and localized markets due to their lower overheads and fixed costs. Moreover,
MSME owners tend to show greater resilience in the face of recessions by holding on to their
businesses, as they are prepared to temporarily accept lower compensation.
Major Constraints to Enterprise Growth and Operations
Electricity, skills and education rank higher as major obstacles to enterprise operations and growth,
while taxation, customs and trade regulations, as well as corruption also rank higher as very severe
obstacles to the enterprise operations and productivity in Zanzibar. Indeed taxation, power supply,
skills, regulations and corruption are critical investment determining factors not only in Zanzibar, but
also in other countries in the region such as Tanzania Mainland, Kenya, and Uganda.
Performance of the MSMEs in Zanzibar
Judging from a few performance indicators namely, labour productivity and capital – output ratio, the
MSMEs in Zanzibar have recorded good performance, which also reveals the existing growth potential
of this sector if measures are taken to address the major constraints affecting growth and operations of
the enterprises.
Poverty Reduction and Livelihood Improvement
Recommendation 2:
Most areas of Zanzibar have a lot of resources. What is missing is the entrepreneurial drive and skills to
see the opportunities and to have the drive, vision and ability to exploit them profitably. A great deal of
capacity building of rural communities and entrepreneurs is required to stimulate their drive and
imagination and to impart business skills. It is very difficult to do this in a commercially sustainable way
_______________________________________________________________________________ 106
at a large enough scale. It is therefore suggested to have mass entrepreneurship development
programmes, which uses mass media (especially radio) to sensitise rural communities to become more
entrepreneurial and also to develop specific business start-up and management skills.
Recommendation 3:
Owing to its potential in stimulating the economy, there is a glaring need to strengthen and develop the
MSMEs sector in Zanzibar. This could be done through various approaches. In addition to
empowerment of local entrepreneurs by improving their entrepreneurial (business) skills, MSMEs would
require appropriate financial services and/or credit accessibility, and market accessibility. Zanzibar must
also build the capacity of regional, district and even ward level officials in strategically facilitating
MSMEs development in their respective areas. Until now, many rural leaders do not see the multiplier
effects of MSMEs or connection between welfare and investments and do not therefore see why they
should facilitate investment. Even some of those who appreciate the importance of MSMEs are at a
loss as to how to go about attracting or retaining them.
Recommendation 4:
Owing to the importance and role of MSMEs in terms of its contribution to GDP, creation of employment
opportunities, inclusiveness, and livelihood sources, the RGoZ has the key role to play by addressing
the major obstacles to enterprise growth and operations. The government must make strategic
investment which targets the growth drivers. By growth drivers we mean sectors or economic variables
which are pace makers in economi growth. These strategic interventions must target the growth drivers
such as electricity supply, transport and the road network. Unless such obstacles are eliminated
MSMEs will have limited space to expand.
Recommendation 5:
It is also critical to rationalize taxation. For example, the Revolutionary Government of Zanzibar needs
to work towards reducing the burden that tax rate and tax administration impose upon enterprises,
rather than focusing on tax reforms which are geared towards improving compliance alone. In other
words, compliance should not be the only important goal of the reforms if fiscal rationalization has to be
achieved.
Recommendation 6:
A speedy formalization process of the informal sector is equally important. However, this process can
only be successful if the cost of formalization is scaled down to make informal operators afford. Since it
is currently expensive to be formalized, most MSMEs are reluctant to change their status.
_______________________________________________________________________________ 107
CHAPTER
7.
7:
GOVERNANCE, PARTICIPATION AND
INGREDIENTS OF PRO-POOR GROWTH
INCLUSIVENESS:
Introduction
This chapter is intended to demonstrate the linkage and association of the governance factors to pro
poor growth in Zanzibar. Specifically, the analysis identifies key governance related factors and
subsequently understands how these factors influence growth and mobility in Zanzibar.
Given the overall theme of the 2009 Zanzibar Human Development Report (ZHDR) i.e. Towards ProPoor Growth, and the fact that MKUZA cluster III is Good Governance and National Unity, this study is
not only relevant, but also paramount in understanding the dynamics of growth and poverty, the route
causes or determinants, and poverty escape routes in Zanzibar. The study has strong relevance for
policy design and monitoring of growth as well as poverty reduction strategies for Zanzibar. At the end
of the discussion and analysis it will provide policy insights based on the experiences of the way
governance factors determine the changes in the pattern of economic activities (economic growth) and
therefore change in livelihoods (poverty) of the people of Zanzibar overtime. Bad governance is being
increasingly regarded as one of the root causes of poor social, economic and political development
(Narayan et al 2005; Kessy et al 2006; RGoZ 2008). For instance, government sometimes acts as an
obstacle to growth either through “sins of omission”, for example if services are not delivered or “sins of
commission” when the government interferes where it should not (Kessy et al 2006).
7.1
The Key Concepts and Study Approach
(a)
The Key Concepts
Governance is increasingly being used and embraced in development agenda. The Zanzibar Strategy
for Growth and Reduction of Poverty (ZSGRP or MKUZA) for example recognizes the importance of
promoting Good Governance (See RGoZ 2007). Today, major donors and international financial
institutions such as International Monetary Fund (IMF) or the World Bank are increasingly basing their
aids and loans on the condition that reforms ensuring good governance are undertaken.
Governance has been widely defined by various scholars14. The World Bank defines Governance as
the use of institutions, structures of authority to allocate resources, coordinate or control activities in the
society or the economy. It entails public institutions conducting public affairs, managing public
resources, and guaranteeing the realization of human rights. United Nations Development Programme
(UNDP 1997 in Egli et al 2007) defines governance as the exercise of economic, political and
administrative authority to manage the country’s affairs at all levels. It comprises mechanisms,
processes and institutions, through which citizens and groups articulate their interests, exercise their
legal rights, meet their obligations and mediate their differences. Governance describes the process of
14
See for example World Bank 2007, UNDP (1997) and Kaufmann D, Kraay A and Mastruzzi M (2009)
_______________________________________________________________________________ 108
decision-making and the process by which decisions are implemented (or not implemented), at all
relevant decision making levels (RGoZ 2008). It subsequently involves all state and non state actors
such as Civil Society Organizations (CSOs) and the private sector. At local level, it includes the District
Councils, Municipal Councils, Village Governments (Shehia) etc.
In practice governance is measured through a set of indicators which are also used to define
governance comprehensively. Literature provides different but related sets of governance indicators15.
The most inclusive indicators include the following: Rule of Law; Voice, Decision and Freedom;
Accountability; Control of Corruption; Transparency and Government Effectiveness and Efficiency.
Other indicators are Human Rights; Participation and Inclusiveness; Political Stability; and Democracy.
(b)
The Study Approach
This is a perception survey where secondary information, views of representatives of five Ministries and
100 respondents from Mwanyanya and Chachani Shehias in Unguja and Pemba respectively, have
been analyzed and interpreted16. Mwanyanya and Chachani communities are located in Mjini Magharibi
Region, Magharibi District and Kusini Pemba Region, Chakechake District respectively. A total of three
Focus Group Discussions (FGDs) were conducted and 50 households were interviewed in each of the
two selected villages. Although other governance variables have been touched upon, for the sake of
this study, the focus on governance centers on the following factors: participation (e.g. through
decentralization process and inclusiveness); political system and democracy; and war against
corruption. Thus, as noted earlier the enquiries were tailored towards understanding the linkage
between the above governance factors and changes in the scale of economic activities and livelihoods
(poverty).
In order to assess peoples’ participation in socio economic activities and the government’s support, a
review of the community micro projects has also been made.
7.2
The Study Findings
7.2.1 Governance and Mobility in Zanzibar: Overall Assessment
As noted earlier, three major governance variables have particularly been looked at in this study. These
are, participation (e.g. through decentralization process and inclusiveness); political system and
democracy; and corruption.
(a)
Decentralization Process
Decentralization is defined by Jütting (2004) in Elli (2007) as a transfer of public functions from higher
tiers to lower tiers of governance. It can be administrative, fiscal, political or a mixture of these.
Decentralization aims at devolving powers from central government to local government authorities
See CDG (1998); World Bank (2007); Kaufmann et al (2009); RGoZ (2007); CCM (2005), among others
These are the Ministry of State, Regional Administration and Special Forces (MSRASF), Ministry of Constitutional Affairs
and Good Governance (MoCAGG), Ministry of Finance and Economic Affairs (MoFEA), Ministry of Labour, Youth, Women
and Child Development (MLYWCD), and the Ministry of Agriculture and Environment (MALE).
15
16
_______________________________________________________________________________ 109
(LGAs) to enable the lower communities improve their participation in decision making process and
therefore economic activities. Through decentralization, LGAs are endowed with wide-ranging powers
and become largely autonomous institutions, democratically governed and deriving their legitimacy from
the services they provide to the people17.
Zanzibar Constitution provides for the establishment of local government structures, and a legislation
which enables the creation of Zanzibar Municipal Council as well as District and Town Council was
enacted in 1995. However, Zanzibar has not officially started to implement the Local Government
Reform Programme (LGRP) despite a series of preparatory forums some of which are still going on to
chart out suitable implementation framework of the programme.
Despite all these snags, since 1980 the Revolutionary Government of Zanzibar has been striving
towards a more decentralized society by gradually delegating powers to the LGAs institutions at lower
level. Such delegation of powers is an integral part of decentralization process and the broader
structural reforms in Zanzibar, despite the fact not much has so far been accomplished. According to
Liviga (2004) provision of basic services such as primary education, primary health, agricultural
extension and roads is still under the Central Government, despite the fact that staff has been deconcentrated from the Central Government Departments to the district level. Note also that, under the
World Bank support, the Government has recently embarked on a comprehensive initiative and/or task
namely the Public Service Reform Programme. The reforms will take on board the aspects of local
government in its totality.
The LGAs are autonomous organizations and have important powers to carry out their functions
established under Local Government Act no 3 of 1995 (which provides for functions of District Councils,
among other things). A central focus of the reforms is to strengthen the LGAs. Broadly speaking, the
roles and main functions of LGAs (District Councils) are defined as follows: formulate, coordinate and
supervise the implementation of plans for economic, commercial, industrial and social development;
ensure proper collection and utilization of revenue of the council; pass by-laws applicable throughout
their area of jurisdiction; and consider, regulate and co-ordinate development plans, projects and
programs of villages and township councils within its area of jurisdiction. Out of the broad roles, a
number of specific functions and powers of LGAs have been spelt out. They include, establishment and
maintenance of recreation grounds; actions to promote public health; construction of drainage works;
and administration of markets. Although overall mandate of revenue collection is still under the Central
Among others, the main principles of the local government reforms are, letting people participate in government at the
local level and elect their leadership; bringing public services under the control of the people through their local councils;
giving local councils political powers over all local affairs; improving financial and political accountability; securing finances
for better public services; de-linking local administrative leaders from their former ministries; and creating new central-local
relations based not on orders but on legislation and negotiations
17
_______________________________________________________________________________ 110
Government, LGAs are mandated to collect certain types of revenues within their areas of jurisdiction.
These are own source revenues collected through registration of taxis, auctioneers fees, fees from rent
and use of council property, property tax etc. Otherwise other sources of revenue are, grants from
central government; and loans which are offered with the permission of the Minister. Grants from
central government are generally earmarked for salaries.
Unlike in the Mainland, the sub-ward governing unit in Zanzibar is known as Shehia whose leader is a
Sheha who is reporting to the Central Government. However, while Mainland Tanzania has elected
Village Governments below districts level, sub-district (sub-municipality and sub-town council), Sheha in
Zanzibar is appointed by the Regional Commissioner upon advice from the District Commissioner.
According to the Regional Administration Authority Act number 1 of 1998, section 17 the Sheha is
responsible for the following LGA functions:
(a)
Implementation of all the government laws, orders, policies and directives, for maintenance of
law and order
(b)
Reconciliation and settlement of all social and family disputes arising in that area in accordance
with the cultural and customary values of that area and wisdom
(c)
Keeping records of all documents relating to the registration of marriage, divorce, births and
deaths, ngoma permits, transportation of crops, livestock, charcoal permits and so forth as
directed from time to time by the institutions concerned
(d)
The control of immigration in his Shehia and keeping records thereof
(e)
Receiving notification for convening all public meetings
(f)
To do all other things which are legal and has been assigned to him by the District
Commissioner
In addition and in the absence of the police, the Sheha can order arrests18. A Shehia Advisory Council
(SAC) is another body legally established to advice the Sheha. The Council is composed of a minimum
of 12 members. All the 12 members are appointed by the Sheha in consultation with the District
Commissioner. A third of the members shall be elderly persons (60 years or above) and those who
command respect in their Shehia or community. A Shehia is therefore mandated to perform functions
and deliver services which are critical to the community. Unlike District and Municipal Councils which
are the lowest Local Government Authorities for rural and urban areas respectively, Shehia is a Central
Government structure. Note that, Shehia enjoys some degree of autonomy despite the fact that it is
under Central Government administrative hierarchy.
18
See section 19-3 of the Regional Administration Authority Act number 1 of 1998
_______________________________________________________________________________ 111
Another Local Government structure at the lower level is a Ward. A Ward is an administrative unit as
well as an election constituency for Councillors. Unlike in the Mainland, the lower governance structures
in Zanzibar is slightly different, whose functioning and therefore performance is also unsatisfactory.
There is great harmony between Councillors and Village governing bodies in the Mainland than it is
between the Concillors and Shehas in Zanzibar. Councillors and Village leadership in the Mainland
work together and attend village as well as ward forums together. The participation of both parties in
decision making process is highly appreciated. This is not the case in the isle as Councillors and
Shehas have been the two parallel (and sometime conflicting) structures which serve the same
constituency and communities.
Unlike Shehas, Councillors in Zanzibar are just political figures who do not have executive powers.
Administratively, Shehas are more powerful than councillors. All community members are under the
Sheha and most of them are loyal to the Sheha, while only members of the councillor’s political party
will be loyal to the respective councillor. Unlike in Tanzania Mainland, the current governance system
in Zanzibar gives more power to the Sheha than the Councillor despite the fact that the Sheha is not
elected through the ballot box in the same way the Councillor does.
Procedurally, land acquisition requires that the applicant submits the application to the Councillor and
becomes the owner of the land after the verbal approval of the application by the Councillor. Shehas
are mandated to issue the final certificate only. However, in practice, the entire process has somehow
been hijacked by Shehas who are now issuing certificates directly without waiting for the initial
application process under the Councillor’s jurisdiction. In other words, applicants apply straight to
Shahas bypassing Councillors. This has been possible because Councillors have no place in the
application forms where they make any binding approval. The current administrative structure at lower
level is an obstacle rather than facilitator towards economic development and improved social welfare.
This structure encourages conflicts and contradictions which tend to fuel disputes among community
members. Among others, the current reform programme aims at defining a platform for councillors, so
that they also have a forum to meet with the people.
There is therefore an urgent need to ensure the integration of these diverging interests so that both two
sides are made to serve the interests of the people. Such measures will significantly improve the
efficiency and overall performance of the government structures at the lower level. Note that several
parallel planning processes exist at community level. In general all these plans are initiated at
community level and passed through the Shehia Advisory Council before being submitted and tabled
for approval and funding at the District Council or Regional Development Committee or the Central
Government (MoFEA Community Development Programme). Communities are entitled to a maximum
of 75 percent of the locally collected revenue to finance community initiated projects. For a typical rural
district that would amount to about TZS 7 million.
_______________________________________________________________________________ 112
As part of the emerging concerns for good governance as a prerequisite for sound development
management, the policy of devolution of power to sub national governments i.e. decentralization, has
been popularized overtime and the government and development partners (donor agencies) are active
in promoting it. Although decentralization programme has not officially started, the governance activities
at local level have enhanced opportunities for participation, by placing more power and resources at a
closer, more familiar and more influence of the local government. Decentralization is viewed as a first
step towards creating a regular and predictable opportunities for citizen’s participation and local
authorities’ transparency and accountability that has in turn stimulated investments and lead to
improvement in the quality and availability of services provided by the local government authorities in
Zanzibar.
(i)
Contract Formation and Dispute Resolution
Related to the functions, roles and other mandates executed by Local Government Authorities at
community level is the contract formation. The local level administrative institutions are not legally
empowered to attest to the legal documents. Section 10 of the Notaries Public and Commissioner for
Oaths Act provides for the lists of persons given powers of notary public in respect of administering
oaths, taking affidavits, attesting signatures and certifying copies (PBFP 2008). However, this provision
excludes the Shehas and Councilors who are the executives and representatives of the shehia and
ward respectively. Yet these units (Shehas and Councilors) are made to certify (endorse) and handle
many agreements and contracts worthy millions of Tanzania shillings.
The current official system is not user friendly, as contract formation procedures are complicated with
certain legal requirements that are not affordable to the small businesses (including farmers and
fishermen) at local level. Many people have subsequently lost their assets and properties with no
compensation because the support documents provided by LGAs (agreements or contracts) are not
accepted by the legal system. This system has some implications in asset and property ownership and
therefore poverty and livelihoods. For example, in the absence of reliable LGAs mediation role, people
have lost their rights and properties like land, livestock, money etc, which has a serious implication to
investment and economic performance in general, thus influencing the livelihood sources of individuals.
According to the Social Welfare Department of the Zanzibar Ministry of Labour, Youth, Women and
Child Development (MLYWCD), governing bodies at Ward as well as Shehia level play a significant role
in conflict and dispute resolution at community level. They have been active in resolving community
social relations based disputes such as marriage conflicts, break-ups, gender based violence, women
abuse etc, which are very common and growing overtime (See some evidence in Box 7.1 by Iddi Juma
of Mwayaya Community). The dispute settlements are pre-requisites for peace and security among
families which are fundamental for development.
_______________________________________________________________________________ 113
Box 7.1: The Death of my Wife
 Life has changed significantly largely due to the foreign influence and the
growing poverty in the country. We are more vulnerable today than 20
years ago because we have lost our norms and traditional values.
 I was forced to divorce and abandon my family following the hardships of
life I was facing, and subsequently my wife died because there was no
one to support her and my children.
 In 1995 I lost my job as a restaurant attendant following a ban imposed
to the restaurant because the owner was supporting the opposition
party.
Iddi Juma, 61 years old, June 2009, Mwanyanya Community, Unguja
(ii) Participation in Economic Activities
Though not fully implemented, decentralization has created community awareness and stimulated
economic activities among members of the communities. There is unanimous appreciation of the
Participatory Agricultural Development and Empowerment Project (PADEP) bottom up approach in
Zanzibar as opposed to the previous anti poverty initiatives which employed top down approaches,
despite the fact that some farmers were too poor to meet PADEP criteria, particularly the 50 percent
counterpart cash contribution (Kundy 2008). Already TZS 3.36 billion out of TZS 3.44 billion and 0.26
billion have been disbursed to various farmers and/or communities in Zanzibar (See Table 7.1 and 7.3
which present the 2008 cumulative funds disbursed by PADEP to community agricultural development
sub-projects (CADS), and small scale projects sponsored by UNDP and DFID in 2007/2009). It is also
evident that the resources disbursed under PADEP initiatives have made a significant change in
performance of the economic activities in Zanzibar communities. Average production of livestock
products before and after the PADEP for example has increased by more than 70 percent according to
the statistics by the Ministry of Agriculture, Lands and Environment (MALE)19. This is equivalent to 97
percent achievement which is partly accounted for by the role (initiatives and support) the Local
Government institutions play within the respective communities.
Some of the poor communities who could not directly participate and access PADEP resources due to
inability to contribute the 50 percent of the total project start-up capital, have managed to access the
project benefits indirectly by learning farming technologies from PADEP through Demonstration Farms
(Shamba Shule). Note that, success of PADEP was to some extent possible due to the commitment of
the respective Shehia government and especially the Shehia Advisory Committee who had to
disseminate the information about PADEP to the farming community, and afterwards endorse and
approve the individual farmer’s applications. Thus, the role of the LGAs was critical for the success of
PADEP and therefore economic prosperity.
19
See also Appendix Table D7.1 and D7.2.
_______________________________________________________________________________ 114
Note also that, a number of other projects under a World Bank sponsored project (TASAF) have been
implemented in Zanzibar under the coordination and supervision of Community Governments. The
TASAF projects covers education, water and health, among others (See for example Box 7.2).
Table 7.1: Cumulative Fund Disbursed to Community Agricultural Development Sub-projects (CADS)
as at 31st March, 2008
DESCRIPTION
CURRENCY USED: TZS
Allocated
Disbursed
FGIS
Central
West
Wete
Chake Chake
North A
Total FGIS
270,350,200
241,537,500
153,149,000
142,950,000
374,457,650
1,182,444,350
266,065,235
230,143,280
153,071,000
136,449,700
365,218,250
1,150,947,465
4,284,965
11,394,220
78,000
6,500,300
9,239,400
31,496,885
98
95
99
95
97
97
Total CIS
679,798,900
364,000,000
357,126,500
497,334,410
362,485,500
2,260,745,310
656,492,260
364,000,000
342,253,700
483,817,830
362,485,500
2,209,049,290
23,306,640
0
14,872,800
13,516,580
0
51,606,020
97
100
96
97
100
97
Total CADS
3,443,189,660
3,359,996,755
83,192,905
CIS
Central
Chake Chake
North ‘A’
West
Wete
Not disbursed
PERCENT
DISBURSED
97.58
Note: 1. FGIS = Farmer Group Investment Sub-projects 2. CIS = Community Investment Sub-projects 3. CADS =
Community Agricultural Development Subprojects
Source: MALE (2008) in Kundy (2008)
Box 7.2: TASAF Benefits
Introduction of TASAF projects is among the positive events in this
community. There are those who make substantial benefits through
construction of schools, heath centers and others benefit through
accessibility of clean and safe water.
Mr Said Zahor, 54 years old, Mwamwanya Village, Unguja, June 2009
_______________________________________________________________________________ 115
(iii)
Participation in Decision Making and Holding the Government Accountable
In theory, decentralization is a means of enabling communities to participate in decision-making, to
enable them increase their political, social and economic citizenship and to ensure they enjoy their
social, political and economic rights as subjects and not objects of governance and development.
The policy process in Zanzibar has strategically gone through changes to allow for Non State Actors
(NSAs) participation in all aspects of creating development policies in the country20. These aspects
include policy formulation, implementation, monitoring and evaluation. The initial steps to involve NSAs
in policy dialogues began in the mid-1980s when the government started to relax the suppression of
civil society. However, major changes began in mid 1990s when civil societies were for the first time
recognized as major stakeholder in policy process in Zanzibar.
Since mid 1990s NSAs have actively participated in formulation of different national policy frameworks
and/or processes such as the Zanzibar Vision 2020, the Zanzibar Poverty Reduction Plan (ZPRP),
Zanzibar Strategy for Growth and Reduction of Poverty (ZSGRP), MKUZA Costing, Zanzibar Good
Governance Strategy and Zanzibar Growth Strategy. Various mechanisms have been institutionalized
at different levels i.e. from the grassroot to the national level (village, municipal, district, regional and
national levels) to provide room for civil society access and participation in policy process in Zanzibar.
The quality of partnership between the Revolutionary Government of Zanzibar (RGoZ) and NSAs has
reached a higher platform recently as the two sides appreciates the attitude and effort by each other.
NSAs are begining to appreciate government effort in widening the participative process in generating
policies so as to make them more inclusive and effective. Reciprocal recognition by government of this
NSAs positive attitude and contribution is enhancing the mutual trust. The feedback and response from
Private Sector for example are not taken as antagonism any more. These findings are also supported
by Makaramba and Kessy (2006) who observed that the CSOs presence in the Zanzibar Poverty
Monitoring System and Public Expenditure Reviews (PER) is now stronger through the Association of
Non Governmental Organizations in Zanzibar (ANGOZA).
(iv)
A Sense of Ownership and Responsibility
There is adequate evidence that, decentralization in Zanzibar has promoted a sense of ownership as
well as responsibility towards public infrastructure (properties), among others. Official statistics clearly
show that more public infrastructure such as education and health facilities have been provided
(constructed) in various communities of all the districts under the supervision of the local authority and
lower community level governance institutions such as municipal and district councils, shehia
government, and Shehia Advisory Councils respectively. The local government authorities have not
only been able to supervise construction works, but also mobilized contributions from community
members in terms of time, labour as well as financial resources.
20
It includes Community Based Organizations (CBOs), CSOs, Private Sector and Non Governmental Organizations (NGOs)
_______________________________________________________________________________ 116
Table 7.2 presents the number of public schools in Zanzibar by category. As it can be depicted from
the table, the number of nursery schools, primary schools, primary and middle schools, and secondary
schools has increased significantly between 2003 and 2008. While, the number of nursery schools has
increased from 172 in 2003 to 235 in 2008, primary schools have increased from 98 in 2003 to 154 in
2008 (See both Tables 7.2 and 7.4). The number of middle schools (with primary schools) and
secondary schools has also changed from 107 to 123 and 29 to 75 between 2003 and 2008. This
success story is attributed to the increased community participation and growing sense of ownership of
the public service institutions. In recognition of this collaboration between the Government and NSAs,
development partners have joined hands in supporting community efforts in the social development
areana.Table 7.3 shows the level of financing by UNDPand DFID between 2007 and 2009.
Table 7.2: Number of Public Schools by Category: 2003 – 2008
Category
Nursery Schools
Primary Schools
Primary and Middle Schools
Secondary Schools
Technical Biased Schools
Islamic College
Technical College
Teacher Training College
Science Biased Schools
Business Biased Schools
Universities
Total
2003
24
74
97
25
2
1
1
1
1
2
1
2004
24
92
104
36
2
1
1
1
1
2
1
2005
25
117
90
48
2
1
1
1
1
2
1
2006
25
109
109
64
2
1
1
2
3
2
1
2007
25
119
105
69
2
2
1
2
4
2
1
2008
26
129
103
69
2
2
1
2
4
2
2
229
265
289
319
332
342
Source: Zanzibar Economic Survey 2008
_______________________________________________________________________________ 117
Table 7 3: Small Scale Projects Sponsored by UNDP and DFID in 2007/2009 in TZS
Sn
Project Nae
Location
Amount in TZS
1
Construction of Maternity Wad
Tumbatu – Unguja
50,000,000
2
Construction of Donge Secondary School
Donge – Unguja
40,000,000
3
Irrigation and Livestock
Ubago - Unguja
22,417,840
4
Construction of Residential Houses for Medical Ukutini – Pemba
Staff
34,460,000
5
Construction of Residential Houses for orphans
Mazizini – Unguja
42,000,000
6
Construction of Kiwani Secondary School
Kiwani – Pemba
24,993,660
7
Construction of Dunga Secondary School
Dunga – Unguja
43,095,000
8
Total
256,966,500
Source: Zanzibar Economic Survey 2008
Likewise, the number of Public Health Centers (PHC) – level 1 has increased from 107 to 119 between
2007 and 2008, while the number of PHC level 2 has not changed. The most important point to reckon
at this juncture is that most of the infrastructure such as the education facilities in Tables 7.2 and 7.4,
health facilities, and water facilities at local levels are to a larger extent under the custodian of the lower
governance institutions namely Shehia and Wards. Increasingly, these are the institutions which are
managing and responsible for the development of the facilities. Thus, growth of such facilities is
significantly influenced by the commitment and effectiveness of the governance institutions.
To a certain extent, advocacy and awareness programmes in Zanzibar have created a more
transparent and accountable communities where dictatorship, corruption and exclusiveness have
naturally been minimized. It is also apparent from Table 7.4 which presents number of private schools
by category from 2003 up to 2008, that contribution by NSA and/or private sector in education sector
has been increasing overtime. The total number of private education facilities has increased by
approximately 40 percent from 188 to 263 units. Participation of the Civil Society Organizations in
development projects is therefore increasing with time.
_______________________________________________________________________________ 118
Table 7.2: Number of Private Schools by Category: 2003 – 2008
Category
Nursery Schools
Primary Schools
Primary Middle Schools
Secondary Schools
Technical
Biased
Schools
Universities
Total
Number
of
Private Facilities
2003
148
24
10
4
0
2004
157
21
12
3
1
2005
180
23
15
2
1
2006
160
26
22
5
1
2007
236
27
21
6
1
2008*
209
25
20
6
1
2
188
2
196
2
223
2
216
2
293
2
263
Source: Ministry of Education and Vocational Training in Economic Survey (2008)
(b)
Political System and Democracy
The political system and democratization process in Zanzibar has gone through a significant
transformation since independence (ZEC 2005). Zanzibar ha witnessed a significant transformation
from a single party to a multi-party state thus necessitating the adoption of the multi-party election
system. Unlike in the past, a series of seminars have been organized and conducted for different
community groups. In addition, different voters’ education programmes are organized to each district to
improve perception of voters on democratic process in the country, including voters’ registration
preparation, election campaign and voting. Note also that, registration of eligible voters in Zanzibar has
improved significantly. The Zanzibar Election Commission established a permanent voter register which
was utilized for the first time during the 2005 Zanzibar General Election. To be able to establish a voter
register, some articles of the Election Act 1984 have been amended and special arrangement for all
political parties taking part in the election to campaign freely are made. To enhance transparency and
participation during elections, both the national as well as international observers are invited, and the
media has been free to report. There have therefore been significant appreciations on the gradual
recovery of confidence and trust among supporters of opposition political parties in Zanzibar. The level
of democracy in the last ten years has therefore been improved. The political accord of 2007 is an
example of maturing of democracy in Zanzibar.
That notwithstanding, in a number of cases the police force has been forced to use ammunitions to stop
violence and demonstrators who are supporting other parties especially the opposition. Thus, there are
cases where voters have been intimidated thus making it difficulty for them to vote. The 2000 election
for example witnessed loss of not only lives but also properties of the people due to riots and clashes
between supporters of some political parties and the police force. The loss of properties and the
general fear which was spreading among citizens had affected negatively both the social relations, the
scale of economic activities, as well as the extent and pattern of investments in Zanzibar (See for
Example Box 7.1).
_______________________________________________________________________________ 119
7.2.2 Governance and Mobility in Zanzibar: The Case of Mwanyanya and Chachani Shehias
A total of 100 respondents were interviewed in the two communities of Mwanyanya in Unguja and
Chachani in Pemba. The sections below present the findings of the perception survey.
(a)
Major Livelihood Sources
Members of the Shehias of Mwanyanya in the West District (Unguja) and Chachani in Chake Chake
(Pemba) indicated that the primary activity in the village is fishing and petty businesses, but that a
number of other sources of income also exist. These include: formal employment, transportation,
lumbering, masonry, bread baking, operating restaurants. Fishing and business were found to be the
mainstay and most reliable economic activity for both men and women in Mwanyanya and Chachani.
The majority of respondents were therefore fishermen and traders. About 40 percent of respondents
indicated fishing as their main occupation, 58 percent are traders and 15 percent are employed in the
formal sector. Thus, investment in fishing and trade was mentioned to be the major pillar for movement
out of poverty and people have been able to accumulate assets and build houses using income
acquired from these sources.
(b)
Participation and Inclusiveness
As noted earlier, decentralization in Zanzibar has created the needed awareness and improved
accountability and the sense of ownership of the public infrastructure. Out of the sampled respondents
in the two communities, 45 percent reported that participation and inclusiveness is important for
sustainability of the community projects, while 36 percent thought it builds community confidence and
trust vis-à-vis their Local Government Authorities.
Respondents were also asked to air their views on whether or not participation and inclusiveness in
Zanzibar have improved overtime. Figure 7.1 present the findings from this enquiry (See also Appendix
Table E3). As can be depicted from the table, the interviewed households in Mwanyanya and Chachani
Shehias acknowledge that participation and inclusiveness have made a significant improvement in their
communities between 2000 and 2009. In 2000 for example only 1 percent of the sampled respondents
perceived participation and inclusiveness as important governance variables for economic growth as
well as poverty reduction in their communities (SII = Significant Improvement), whereas by 2009, the
number of respondents changed to 21 percent of the sample. Likewise, the number of those who
acknowledge that there has been some improvement (SOI = Some improvement) changed from 17
percent in 2000 to 31 percent of the total sample in 2009. The trend in Figure 7.1 reveals that
awareness on the importance of the governance variables has been improving with time (See also
Figure 7.2).
_______________________________________________________________________________ 120
Figure 7.1: A Graph Showing Perception of the Status of Participation and Inclusiveness:
June 2009
40
% of Respondents
35
30
SII
25
SOI
20
PO
15
VP
10
5
0
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
Year
Figure 7.2: A Bar Chart Showing Perception of the Status of Participation and Inclusiveness: June 2009
100%
90%
80%
70%
Respondents
60%
50%
40%
30%
VP
PO
SOI
SII
20%
10%
0%
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
Year
In contrast, the remaining 2 graphs for poor performance (P) and very poor performance (VP) of the 2
governance variables further reveals that participation and inclusiveness have made significant
improvement between 2000 and 2009. For example, more than 20 percent of the respondents reported
that it was poor in 2000/01 while, less than 10 percent of the sample perceives that it is poor in 2009.
(c)
Democracy
Further enquiry was geared towards understanding the significance of democracy and its relationship
with the economic growth as well as livelihoods in Zanzibar. Indeed, approximately 90 percent of the
_______________________________________________________________________________ 121
respondents acknowledged that democracy is a critical factor towards economic performance and
poverty reduction in Zanzibar. It therefore has significance and strong relationship to economic growth
and livelihoods.
Figure 7.3: A Graph Showing Perception of the Status of Democracy: June 2009
30
& of Respondents
25
20
SII
SOI
15
PO
VP
10
5
0
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
Year
According to the responses, democracy is said to have assisted Zanzibar in terms of holding the
government responsible, improved service delivery, listening to peoples’ voice and elimination of double
standards. Like the case with participation and inclusiveness, the number of respondents
acknowledging the improvement of the performance of democracy variable in the 2 communities has
been increasing during the period under review (See Figure 7.3 and 7.4). A few respondents
acknowledge the significance of democracy in 2000 (0 and 18 for significant improvement (SII) and
some improvement (SOI) respectively). In contrast more respondents consider democracy as a critical
factor for economic growth and livelihood improvement in 2009 (22 and 28 for SII and SOI
respectively).
_______________________________________________________________________________ 122
Figure 7.4: A Bar Chart Showing Perception of the Status of Democracy: June 2009
100%
90%
80%
70%
Respondents
60%
50%
40%
30%
VP
PO
SOI
SII
20%
10%
0%
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
Year
(d)
Corruption
Unlike, other governance factors, corruption is a chronic problem as perceived by the two survey
Shehias of Mwanyanya in Unguja and Chachani in Pemba. The magnitude of the problem has been
increasing overtime according to the perception of 95 out of 100 interviewed households. This vice has
promoted irresponsibility and caused loss of rights of the people in many ways. About 86 percent of
respondents either lost their employment or their average incomes due to the prevailing corrupt
practices in the two communities. This has a negative impact on livelihoods of the people.
This is supported by perception of the status of corruption in the two communities as demonstrated in
the Figures 7.5 and 7.6. Note that, in terms of numbers of respondents, the number for poor
performance (P) and very poor (VP) performance are far much higher compared to the numbers for
significant improvement (SII) and some improvement (SOI) signifying that through out there has not
been significant improvement, and therefore people are adversely affected as corruption has been
disrupting individual plans and efficiency. As noted earlier, the rights of the people have also been
denied.
_______________________________________________________________________________ 123
Figure 7.5: A Graph Showing Perception of the Status of Corruption in Mwanyanya and Chachani
Shehias: June 2009
60
% of Respondents
50
40
SII
SOI
30
PO
VP
20
10
0
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
Year
Figure 7.6: A Bar Chart Showing Perception of the Status of Corruption in Mwanyanya and Chachani
Shehias: June 2009
100%
80%
60%
VP
Respondents
PO
40%
SOI
SII
20%
0%
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
Year
7.2.3 Major Conclusions and Recommendations
The main objective of this research was to understand and demonstrate on how governance factors
can influence pro poor growth and livelihood in Zanzibar. In addition to the literature review,
consultation with four ministries, interviews with community members (Mwanyanya community in
Unguja and Chachani community in Pemba) were conducted. We cannot generalize conclusions from
these findings because the sampled communities are only 2 out of 251 communities or shehias in
Zanzibar. Nevertheless, given the homogeneity of communities in Zanzibar, these findings can be
_______________________________________________________________________________ 124
robust and they can therefore be used to inform the policy process for policy interventions aimed at
stimulating growth and therefore poverty reduction.
Zanzibar has not officially started to implement the Local Government Reforms partly because some of
the important pre-requisites particularly the required capacities are not in place. In addition, peculiarities
of Zanzibar have created some different views as to whether there is any rationale to incur such
massive costs when it is very clear that the grassroots of Zanzibar can easily be reached by the Central
Government. However, judging from gradual measures and steps taken so far to empower the
grassroot administrative units, and the functions performed by these governance structures, it is evident
that overtime some degree of decentralization is already taking place. Both decentralization and
democracy in Zanzibar have created the needed awareness among community members and improved
accountability and the sense of ownership of the public infrastructure. In other words, with exception of
corruption particularly in the two surveyed Shahias of Mwanyanya and Chachani, there has been some
notable improvement overtime in terms of the performance of governance variables in Zanzibar. These
are mainly participation, inclusiveness, and democracy. It is evident also that, this improvement has
been translated into the changing pattern of economic activities in agriculture and livestock, and more
basic facilities such as schools, water projects, and health facilities are made available. These are the
basis for improved quality of life of the people. In addition, more legal services such as contract
formation and dispute settlement have also been made available to the people through the lower level
governance institutions.
Implementation of the Local Government Reform Programme (LGRP) in Zanzibar is long overdue.
These delays are costly to the communities in terms of lost opportunities. LGRP in Zanzibar is therefore
a matter of urgency. The present local government structure is neither efficient nor effective and does
not support pro poor growth initiatives in Zanzibar. Apart from giving local government structures more
powers, there is inadequate capacity for the existing governance units at the lower level to execute their
functions and be able to meet the enormous prevailing demands for governance services. Capacity
building of the local governance institutions is therefore inevitable.
As noted earlier, a Ward is another important government structure at a lower level. However, in
Zanzibar this is only an election constituency for electing Councillors. Such governance structures are
not as efficient and effective as the grassroot structures of the Mainland governance system where
there is great harmony between the Councillors and village governing bodies. In the Mainland, the two
have tended to work together and attend village as well as ward forums together. Unlike Zanzibar,
participation of both parties in decision making process is highly integrated and harmonized. This is not
the case in the isle where Councillor and Shehas have been the two parallel and conflicting structures
despite the fact that they serve the same constituency.
_______________________________________________________________________________ 125
will be royal to the councillor. Unlike in Tanzania Mainland, the current governance system in Zanzibar
gives more power to the Sheha than the Councillor despite the fact that the Sheha is not elected
through the ballot box the same way the Councillor does. The current administrative structure at lower
level has tended to be an obstacle rather than facilitator towards economic development and improved
social welfare. This structure encourages conflicting and contradicting ideas and initiatives targeting the
same communities, due to the obvious conflict of interests between the two sides. Political interests
have normally tended to outweigh economic (and social) interests. There is therefore an urgent need to
ensure harmonization of these diverging interests so that both the two sides are made to serve the
interests of the people. Such measures will significantly improve the efficiency and overall performance
of the government structures at the lower level. In addition the legal system in Zanzibar needs to be
tailored in such a way that it mandates Councillors to participate fully in collaboration with shehas in all
planning and development processes of the shehias. Furthermore, the Shehas should also be elected
through the ballot box to make them legitimate leaders. In order to make Shehas more effective with a
certain degree of autonomy, shehia should be under Local Government rather than Central
Government.
Procedurally, land acquisition requires that the applicant submits the application to the Councillor and
becomes the owner of the land after the verbal approval by the Councillor. Shehas are mandated to
issue the final certificate only. However, in practice, the entire process has somehow been hijacked by
Shehas who are now issuing certificates directly without waiting for the initial application process under
the Councillor’s jurisdiction. In other words, applicants apply straight to Shahas bypassing Councillors.
This has been possible because Councillors have no place in the application forms where they make
any meaningful approval. There is therefore an urgent need to rectify this anomaly as it contradicts the
governing rules of the country.
To some extent corruption is exacerbated by a mixture of factors such as poverty, unemployment, low
salary scales for the civil servants, and lack of capacity of the institutions mandated to fight corruption
such as the police force, Tanzania Revenue Authority (TRA), Tanzania Food and Drugs Authority
(TFDA), and Tanzania Bureau of Standards (TBS). One feasible approach to fight this evil is to scale up
the capacity of all the institutions mandated either directly or indirectly to address corruption in terms of
financial resources and working environment. In addition, the war against corruption can only make
progress where there is political will and support.
_______________________________________________________________________________ 126
CHAPTER 8: KEY MESSAGES
8.1
Human Development Situation
This report reviews human development situation in Zanzibar by assessing trends and offers a baseline
for future assessment. Four dimensions of human development, namely, income, health (including life
expectancy), knowledge and gender have been assessed. With regards to human development
situation the following are observed;

Zanzibar has been enjoying an impressive growth in the last two decades

There is some significant disparity across districts in terms of per capita income

Mean expenditure per person per day in Zanzibar is less than a dollar. This means that Zanzibar
still suffer high poverty.

Various indications of health show that Zanzibar is making some progress. Using nutritional
indicators, Zanzibar outperform Tanzania Mainland. Zanzibar is also on track to attaining healthrelated MDGs

Private health facilities are concentrated in very few districts. These facilities seem to be attracted
by high income but not by the general need for medical services. This means that government must
continue to play a key role in offering health services, otherwise the poor would be left out.

Zanzibar has an impressive gross enrolment ratio in schools, but this tapers out very significantly at
the tertiary level of education.

Over 90 percent have been trained as educationist. Overall, however, the highest education of
teachers prior to being trained in education is generally low and this has a negative effect in the
quality of education.

There is still an insignificant representation of females in key decision making bodies and executive
positions. There is a need for a strategy for redressing this gender imbalance to be put in place.

The Human Development Index in this report is calculated for the year 2005 covering ten region;
Region
Mjini/Magaribi
Kusini Unguja
Kusini Pemba
Kaskazini Unguja
HDI
0.8557294
0.653992476
0.639721323
0.600669223
Kaskazini Pemba
0.5590927
_______________________________________________________________________________ 127
8.2
National Income Growth and Distribution
This report has analyzed the pattern of economic growth in Zanzibar and related the same to other
socio-economic indicators such as employment, labour (cash) income, and poverty indices. The
following are the key findings;

Overall income measured by GDP has been growing since 2002, though at declining rate.

Growth has been accompanied with job creation, but the wage level (cash pay, including benefits)
has remained rather low. This indicates, partly, that there is inadequacy in the creation of decent
jobs.

But concealed in that overall GDP growth are huge fluctuations in sector incomes and their
respective growth. These fluctuations imply variable incomes at household level. If such variability
is not off-set by incomes from other sectors, it further implies high levels of vulnerability to poverty.
In the absence of longitudinal HBS data, the extent of such vulnerability can only be implied
indirectly.

Also, in the absence of longitudinal HBS data, poverty level in non-survey years can not be directly
estimated. One of the ways to show the likely levels and path of poverty is to simulate poverty path
under various scenario of income distribution.

Income poverty might have declined substantially given the reported GDP growth and under the
assumption of mild increase in inequality of up to 5 percent per year. But with extreme inequality,
poverty might have increased. The exact position of where income poverty level in Zanzibar is will
wait till the result of the next HBS.
8.3
Reaching the Poor: Poverty and Household Income Distribution
The 2004/2005 HBS has been used to analyze poverty and income distribution in Zanzibar. The
analysis is carried at a more rigorous level than hitherto done using this data. Before summing up the
findings, it is important to appreciate that this HBS is relatively old for the 2009 Human Development
Report. Things might have changed on the ground by 2009. We shall only know about such possible
changes once new HBS data becomes available. The key findings from the analysis using the available
data are;

There is some disparity in household welfare in Zanzibar. This disparity is manifested spatially
across districts. Micheweni is the poorest district in Zanzibar, followed by Wete and then Chake
Chake. In general, three of the four districts of Pemba suffer the highest poverty in Zanzibar.

Pemba is in general poorer than Unguja. This can be explained by geographical remoteness of
Pemba and poor infrastructure, particularly electricity. There are some indications that economic
activities is starting to boom in Pemba.
_______________________________________________________________________________ 128

Levels of poverty across districts do not seem to be taken into account in the allocation of
resources across districts. Even though poverty cannot be the sole determinant of such allocation,
it is important that it is taken into account too in resource allocation.
8.4 Tourism and Human Development
Zanzibar has, arguably, the best tourist attractions and is most suitably located to attract tourists than
any other country/territories in the West Indian Ocean. Yet Mauritius and Seychelles collect by far more
revenue from tourism than Zanzibar. The two island nations are also far ahead in terms of Human
Development Index than Zanzibar.

There is an urgent need to establish tourism satellite account for Zanzibar.

A salient feature of tourism in Zanzibar is that even though it contributes about 25 percent of the
GDP, it does not generate significant direct employment. It appears therefore that rather than
considering tourism as an avenue for generating mass employment, it should be considered as an
avenue for generating revenue that can be used to diversify the economy and thus indirectly
contribute to employment creation in other sectors. Even then, there is a need to introduce training
levy on tourist hotel to be used to train Zanzibaris in hotel management so as to ensure high skills
employment opportunities in the tourist sector benefit the Zanzibaris too.

While it is easy to lament lack of employment opportunities for Zanzibaris in the tourists hotels it is
more difficult to take measures to ensure that proper training is given to Zanzibaris to qualify for
these jobs. Deliberate efforts need to be put in place to train Zanzibaris on hotel related activities,
including management, languages, food and beverages and so on up to international standards.
Institutions that are currently offering this training in Zanzibar and Tanzania in general need to be
inspected regularly to ensure quality and a condition for obtaining international accreditation must
be imposed. Scholarships to train Zanzibaris abroad on hotel management need also to be
established.

Zanzibar rakes in fewer dollars per tourist compared to the island nations in the West Indian Ocean.
This is because in spite of the policy, Zanzibar has no proper strategy to attract up-market tourism
which must include development of conference facilities of international standards to attract
conference tourism, and through encouraging investment into large high class hotels with golf
course, spa and other attractions. One step that needs to be taken is to revoke land lease on all
land that is idle but being held speculatively so that more serious investors can be encouraged to
step in. Secondly the government need to insist that any new hotel has to be five stars and large
enough to cater for up-market large tourism. The Zanzibar International Airport must also be
upgraded to handle larger traffic and improve its standard. In order to attract more up-market
tourism, it is important also to reform the financial and insurance institutions and improve health
services to international standards both for the benefit of the population and tourists.
_______________________________________________________________________________ 129

There is a need to improve the system of collecting government revenues from tourism business.
8.5 MSME and the Prospect of Poverty Alleviation
MSMEs is a critical sector for the transformation of the economy of Zanzibar. Most enterprises in
Zanzibar operate in Unguja (about 70 percent), while only 30 percent are in Pemba. In terms of regional
distribution, the Urban West which is in Unguja is home for approximately 50 percent of the total
number of MSMEs in Zanzibar. South Region (Unguja) has the least number of the businesses. The
most attractive district for MSMEs is Urban District in Unguja with 37 percent of the total businesses.
South Unguja is the most deprived district in terms of available number of businesses. MSMEs in
Zanzibar are dominated by the micro-enterprises with between 1 and 2 employees (72 percent).
Both the business register and business census indicate that majority of businesses (MSMEs) are
owned by families. This is mainly intended to ensure security of assets as well as a means of
minimizing operating costs.
MSMEs have the potential to provide livelihood for a considerably large number of people in Zanzibar
and other countries in the region. Since MSMEs tend to be labour-intensive, they create employment at
relatively low levels of investment. In addition, MSMEs are better positioned to satisfy limited demands
brought about by small and localized markets due to their lower overheads and fixed costs. Moreover,
MSMEs owners tend to show greater resilience in the face of recessions by holding on to their
businesses, as they are prepared to temporarily accept lower compensation.
Power supply, skills and education rank higher as major obstacles to enterprise operations and growth,
while taxation, customs and trade regulations, as well as corruption also rank higher as obstacles to the
enterprise operations and productivity in Zanzibar. Indeed taxation, power supply, skills, regulations and
corruption are critical investment determining factors not only in Zanzibar, but also in other countries in
the region such as Tanzania Mainland, Kenya, and Uganda. Judging from a few performance indicators
namely, labour productivity and capital – output ratio, the MSMEs in Zanzibar have recorded good
performance, which also reveals the existing growth potential of this sector if measures are taken to
address the major constraints affecting growth and operations of the enterprises.
Owing to the importance and role of MSMEs in terms of its contribution to GDP, creation of employment
opportunities, inclusiveness, and livelihood sources, the RGoZ has the key role to play by addressing
the major obstacles to enterprise growth and operations. These strategic interventions must target the
growth drivers such as power supply, transport and the road network. It is also critical to rationalize
_______________________________________________________________________________ 130
taxation, and address issues related to enterprise capacity such as skills (human resources) and
financing. For example, the Revolutionary Government of Zanzibar needs to work towards reducing the
burden that tax rate and tax administration impose upon enterprises, rather than focusing on tax
reforms which are geared towards improving compliance alone.
In other words, compliance should not be the only important goal of the reforms if fiscal rationalization
has to be achieved. Formalization of informal sector is equally important. However, this process can
only be successful if the cost of formalization is scaled down. Since it is currently expensive to be
formalized, most MSMEs are reluctant to change their status.
8.6 Governance, Participation and Inclusiveness
We cannot generalize conclusions from these findings because the sampled communities are only 2
out of 251 communities or shehias in Zanzibar. Nevertheless, given the homogeneity of communities in
Zanzibar, these findings can be robust and they can therefore be used to inform the policy process for
policy interventions aimed at stimulating growth and therefore poverty reduction.
Zanzibar has not officially started to implement the Local Government Reforms partly because some of
the important pre-requisites particularly the required capacities are not in place. However, judging from
gradual measures and steps taken so far to empower the grassroot administrative units, and the
functions performed by these governance structures, it is evident that overtime some degree of
decentralization is already taking place. Implementation of the Local Government Reform Programme
(LGRP) in Zanzibar is long overdue. These delays are costly to the communities in terms of lost
opportunities. LGRP in Zanzibar is therefore a matter of urgency. The present local government
structure is neither efficient nor effective and does not support pro poor growth initiatives in Zanzibar.
Both decentralization and democracy in Zanzibar have created the needed awareness among
community members and improved accountability and the sense of ownership of the public
infrastructure. In other words, with exception of corruption particularly in the two surveyed Shahias of
Mwanyanya and Chachani, there has been some notable improvement overtime in terms of the
performance of governance variables in Zanzibar. These are mainly participation, inclusiveness, and
democracy. It is evident also that, this improvement has been translated into the changing pattern of
economic activities in agriculture and livestock, and more basic facilities such as schools, water
projects, and health facilities are made available. These are the basis for improved quality of life of the
people. In addition, more legal services such as contract formation and dispute settlement have also
made available to the people through the lower level governance institutions.
A Ward is another important government structure at a lower community level. In Zanzibar this is only
an election constituency for electing Councillors. Such governance structures are not as efficient and
effective as the grassroot structures of the Mainland governance system where there is great harmony
between the Councillors and village governing bodies. In the Mainland, the two have tended to work
together and attend village as well as ward forums together. Unlike Zanzibar, participation of both
_______________________________________________________________________________ 131
parties in decision making process is highly integrated and harmonized. This is not the case in the isle
where Councillor and Shehas have been the two parallel and conflicting structures despite the fact that
they serve the same constituency.
will be loyal to the councillor. Unlike in Tanzania Mainland, the current governance system in Zanzibar
gives more power to the Sheha than the Councillor despite the fact that the Sheha is not elected
through the ballot box the same way the Councillor does. The current administrative structure at lower
level has tended to be an obstacle rather than facilitator towards economic development and improved
social welfare.
There is therefore an urgent need to ensure harmonization of these diverging interests so that both two
sides are made to serve the interests of the people. Such measures will significantly improve the
efficiency and overall performance of the government structures at the lower level. In addition the legal
system in Zanzibar needs to be tailored in such a way that it mandates Councillors to participate fully in
collaboration with shehas in all planning and development processes of the Shehias. Furthermore, the
Shehas should also be elected through the ballot box to make them legitimate leaders.
The enforcement of the existing laws which prevent corruption in the country has been constrained by
counteracting factors including poverty, unemployment, low salary scales for the civil servants, and lack
of capacity of the institutions mandated to fight corruption such as the police force, Tanzania Revenue
Authority (TRA), Tanzania Food and Drugs Authority (TFDA), Tanzania Bureau of Standards (TBS) and
Prevention of Corruption Bureau (PCB). One feasible approach to fight this evil is to scale up the
capacity of all the institutions mandated to fight corruption in terms of financial resources and the
working equipment. In addition, the war against corruption can only make progress where the political
will and support is massive.
_______________________________________________________________________________ 132
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APPENDICES
APPENDIX A
Table A2.1: Immunization coverage under one year by zone from 2005 – mid 2008 (in percentages)
Unguja
Pemba
Zanzibar
VACCINES
BCG
POLIO 3
DPT 3 – HELP B
MEASLES
T.T2+
ECG
POLIO 3
DPT 3 – HELP B
MEASLES
T.T2+
BCG
POLIO 3
DPT 3 – HELP B
MEASLES
T.T2+
2005
124
83
83
93
57
126
88.0
90.1
92
84.1
125
85.0
86
93.5
67
Full immunizations country
coverage
86
Source: Ministry of Health and Social Welfare: EP1 Programme, 2007
2006
110
82
84
89
52
104
89
90
84
73
115
85
86
89
59
2007
112
91
92
100
67
89
63
64
73
52
101
78
78
88
60
2008 (MID)
118
91
93
102
74
107
72
71
74
54
112
82
82
89
65
86
78
82
Table A2.2: Institution maternal mortality ratio by zone, 2007
ZONE
Unguja
Pemba
Zanzibar Total
NO OF MATERNAL
DEATHS
55
16
71
TOTAL LIVE BIRTHS
RATIO PER 100,000 LIVE BIRTH
14,640
4,837
19,477
375.7
330.8
364.5
Source: MoHSW, Health Information Bulletin 2007
Table A2.3: Reported Malaria Cases in Hospital 2005-07
All in-patient cases due to malaria
Under five and inpatient cases due to malaria (clinic and conformed)
Five years above inpatient cases due to malaria (clinical and confirmed)
All inpatient malaria cases which are confirmed.
2005
56
76
39
92
2007
35
48
27
3
Source: Roll Back Malaria Indicator Survey 2007 (Main Report), ZMCR, Ministry of Health and Social Welfare, Zanzibar
_______________________________________________________________________________ 138
Table A2.4: Percentage of Mosquito Nets Utilization 2005-2007
2005
37
100
66
Mothers /guardians who take any section within 24 hours from the onset of the febrile illness.
Mothers/guardians of children under 5 taking any action within 24 hours of fever onset.
Pregnant women sleeping under mosquito net during current pregnancy of during 6 months of
last pregnancy.
Population sleeping under mosquito net
55
Over five sleeping under mosquito net
53
Source: Roll Back malaria Indicator Survey 2007 (Main Report), ZMCR Ministry of Health and Social Welfare
Zanzibar
2007
32
96
65
Table A2.5: PMTCT Enrolment in RCH Clinics 2005-2008
Documented Events
New (ANC) Tested and
counseled
Tested for HIV
HIV positive
Partner testing for HIV
Partner HIV positive
Apr-Dec 2005
2,293
Jan – Dec 2006
7,913
Jan – Dec 2007
17,967
Jan – June 2008
15,284
2,267 (69 percent)
38 (1.7 percent)
12 (0.5 percent)
1 (8 percent)
7,904 (99 percent)
127 (1.6 percent)
227 (2.9 percent)
4 (1.8 percent)
17,739 (99 percent)
167 (0.9 percent)
464 (2.6 percent)
12 (2.6 percent)
15,264 (99 percent)
121 (0.8 percent)
235 (1.5 percent)
10 (4 percent)
Source: MoHSW, Health Information Bulletin 2007
Table A2.6: Result of treatment of Smear Positive – Zanzibar 2005 – 2007
YEARS
N/Notified
Cured
T. Comp
Failure
Died
Defaulter
T. Out
2005
M
119
98
2
5
1
13
2006
F
72
60
2
3
2
7
Total
191
158
4
8
3
2o
M
150
119
1
2
12
16
F
88
77
2
5
4
Total
238
196
1
4
17
20
Source: Tb/Leprosy Program – Mnazi Mmoja Hospital (Mohsw) 2007
_______________________________________________________________________________ 139
71
85
Table A2.7: New diabetic and hypertension patients reported at Mnazimmoja clinic 2005 – 2007
Diabetic Patients
Hypertension Patients
2005
F
126
209
M
114
123
T
240
332
M
113
127
2006
F
148
281
T
251
408
2007
F
155
282
M
128
110
T
288
372
Source: Diabetic and Hypertension Clinics – Mnazi Mmoja Hospital (MohSW)
Table A2.8: Distribution of Persons Reporting Illness or Injury by Source of Consultation and District
Source
Consultation
of
Kaskazini
“A”
Kaskazini
“B”
Referral Hospital
District Hospital
Special Hospital
Primary
Health
Care Unit
Private Hospital
Private Clinics
Pharmacy
7.8
10.5
20.1
1.7
1.1
Kusini
Magharibi
7.1
6.7
29.6
37.0
1.3
47.1
4.3
3.6
0.9
1.3
0.8
5.2
50.2
65.6
67.8
43.6
13.2
9.8
9.3
3.4
2.4
7.2
6.7
9.1
Consulted Private
Doctor
Consulted
Traditional Healer
Missionary Care
Centre
Consulted Others
Multiple
Health
Care
1.7
Number
Individual
of
Kati
Mjini
Wete
Total
Micheweni
Chake
Chake
Mkoani
3.0
2.0
3.1
2.6
11.4
30.1
23.6
37.0
27.8
19.6
5.7
0.7
0.9
0.5
0.5
1.9
25.9
28.7
48.6
63.2
33.8
54.7
46.0
1.7
26.3
20.4
9.1
4.6
8.7
2.6
11.7
0.3
6.8
13.4
3.2
2.2
3.8
1.8
4.7
4.0
0.6
3.0
5.2
6.4
5.4
16.2
14.0
7.7
0.6
1.1
0.9
2.6
1.3
1.4
0.5
1.4
2.5
1.6
1.5
1.0
2.0
1.2
1.2
1.4
2.4
1.0
2.4
1.0
1.6
0.4
1.1
1.3
-
0.2
0.2
0.1
-
0.1
-
0.3
3.9
0.8
2.2
1.2
0.8
0.3
0.1
-
2.0
0.3
1.0
9.3
4.0
6.2
4.1
6.7
14.7
4.5
3.5
8.6
8.2
7.3
17,436
9,595
9,846
4,509
24,274
16,765
25,342
17,918
17,918
20,665
166,613
Source: Household Budget Survey Data
_______________________________________________________________________________ 140
APPENDIX B
Annex B3.1. Framework for analyzing growth and employment
The main framework of analysis is employment elasticity of growth (see Majid, N. (2001) and
Mazumdar, (2003 and 2004))21. The employment elasticity can be estimated (i) as ratio of the
percentage change of the two quantities evolved, and (ii) as a parameter from an econometrically
estimated equation. In the first case, also called arc elasticity, we have:
L Y

.
Y L
where :   changeinthe betweenthetwo period
L  level of employment
Y  GDP or other indicators of national income
  employment elasticity
In the second case,
lnL   0  1Y
where : L  level of employment
Y  GDP or other indicators of national income
1  employment elasticity
In the absence of time series data, we did not attempt time series econometrics where employment
series will be regressed against relevant indicators (GDPs). Instead, we have exclusively relied on the
use of the periodic average growth between two successive employment levels and calculated the
growth rates of the chosen sectors.
21
Majid, N. 2001. The working poor in developing countries, International Labor Review, Vol. 140 (3), International
Labor Office, Geneva. Mazumdar, 2004, Employment Elasticity in Manufacturing, Background paper for World
Employment Report 2004-05, International Labor Office, Geneva. Mazumdar, D. 2003. “Trends in employment and the
employment elasticity of manufacturing, 1971- 1992: an international comparison”, Cambridge Journal of Economics,
(27): 563-582.
_______________________________________________________________________________ 141
APPENDIX C
Table C6.1: Major Markets (Consumers)
Percentage of Establishment Sales Sold To
Businesses
Agriculture and Livestock
Charcoal Making
Digging and Cutting Stone Blocks
Food Processing and Spices
Food Vending
Furniture and Interior Fittings
Furniture Making
Furniture and Wood Process Machine
Garage (Motor Car Maintenance)
Government Man/Training
Guest Houses and Hotel
Kubanja Kokoto
Timber Production (Kupasua Mbao)
Kutengeneza Tambi
Salt Processing (Kutengeza Chumvi)
Furniture Making
Kutengeza Tambi
Total
Average
Individual
Consumer
80
99
78
90
60
70
76
10
30
30
85
70
68
69
100
80
100
1195
70.3
Traders
10
0
12
10
20
20
10
5
50
0
5
30
14
31
0
0
0
217
12.8
Small
Business
10
0
10
0
20
10
14
50
20
0
5
0
18
0
0
20
0
177
10.4
Large
Business
0
0
0
0
0
0
0
0
0
70
5
0
0
0
0
0
0
75
4.4
Others
0
1
0
0
0
0
0
35
0
0
0
0
0
0
0
0
0
36
2.1
_______________________________________________________________________________ 142
Table C6.2: Percentage of Firms Rating Obstacles as Major or Very Severe Obstacles
Sn Obstacles
Overall
Unguja
Pemba
Major
Very
Major
Very
Major
Severe
Severe
1 Telephone, fax, e-mail
9
0
13
0
9
2 Electricity
67*
2
25
13*
74*
0
13
0
67*
3 Transportation
(road 59*
quality, road blocks,
finding
ways
to
transport)
4 Access to land
9
4
38*
25*
4
5 Tax rates
28
7*
38*
25*
26
6 Tax administration
35
4
50*
0
33
7 Customs and trade 9
7*
38
13*
4
regulations
8 Labor regulations
6
2
25
0
0
9 Skills and education of 57*
4
25
13*
63*
available workers
10 Access to financing
31
6*
38*
25*
28
11 Cost of financing
48*
6*
50*
13
52*
1 Economic
policy 33
4
25
0
35
2 uncertainty
6
2
0
13*
7
1 Macro-economic
3 instability (inflation,
exchange rate)
1 Corruption
11
7*
13
25*
11
4
1 Crime,
theft
and 7
0
38*
0
2
5 disorder
0
25
0
0
1 Anti-competitive
or 4
6 unfair practices by other
businesses
1 Legal system, conflict 6
0
25
0
2
7 resolution
1 Access to or availability 37*
2
13
13*
41*
8 of markets
Very
Severe
0
0
0
0
4*
4*
2
0
2*
2*
2*
0
0
2*
0
0
0
0
_______________________________________________________________________________ 143
Table C6.3: Total Expenses, Total Sales, and Enterprise Efficiency
Total Cost of
Sn Firm
Capital
1
Furniture and Fittings
149,969,000
2
Government Man/Training
20,000,000
3
Furniture and Wood Process Machine
2,200,000
4
Roast, Crash and Coffee Packaging
8,216,000
5
Selling Stationery1
1,546,000
6
Selling Stationery2
562,500
7
Food Processing and Spices
210,000
8
Digging and Cutting Stone Blocks
300,000
9
Guest House and Hotel1
700,000
10 Guest House and Hotel2
800,000
800,000
800,000
800,000
14 Welding1
2,525,000
15 Welding2
2,525,000
7,000,000
1,000,000
18 Welding3
2,075,000
19 Welding4
2,525,000
20 Stone Blocks1
2,525,000
21 Stone Blocks2
2,525,000
22 Garage (Motor Car Maintenance)1
2,525,000
23 Garage (Motor Car Maintenance)2
2,525,000
700,000
900,000
26 Welding5
2,525,000
27 Welding6
2,525,000
Total Sales
242,000,000
25,000,000
12,560,000
24,000,000
8,000,000
2,500,000
500,000
2,500,000
3,680,000
3,700,000
3,700,000
3,700,000
3,702,000
5,000,000
5,000,000
4,000,000
4,200,000
5,000,000
5,000,000
5,000,000
5,000,000
5,000,000
5,000,000
3,680,000
3,660,000
5,000,000
5,000,000
Efficiency
62.0
80.0
17.5
34.2
19.3
22.5
42.0
12.0
19.0
21.6
21.6
21.6
21.6
50.5
50.5
175.0
23.8
41.5
50.5
50.5
50.5
50.5
50.5
19.0
24.6
50.5
50.5
Note: Efficiency is measured by taking Total Cost of Capital as a percentage of Total sales. Thus for Welding for example
the total cost of capital is approximately 50 percent of total sales. Thus, the cost of capital has been recovered fully with
extra sales revenue equivalent to the cost of capital
_______________________________________________________________________________ 144
APPENDIX D
Table D7.1: Average Production of Livestock Products before and after PADEP
District
Central
North A
Product type
Unit
Average production
Before
PADEP
After PADEP
Eggs (Local chicken)
Milk (cross)
Milk (indigenous)
Eggs (200 Layers)
Eggs (local chicken)
Eggs (200 Layers)
Wete
Milk (indigenous)
Source: MALE, 2008
West
percent
change
20
number
litres
litres
number
number
number
number
litres
3
2.5
9
32
5
4.25
19
60
67
70
100
0
12
0
1.5
152
16
105
3
100
33
100
100
Table D7.2: Average Production of Crops
PADEP Groups – Average Production (Ton/Ha)
District
Central
Chake Chake
West
Crop
Amarantuhus
Banana
Bitter Aborgen
Cassava
Cucumber
Eggplant
Maize
Okra
Pumpkin
Rainfed rice
Spinach
Tomato
Yams
Banana
Cucumber
Eggplant
Groundnuts
Maize
Onions
Sweet pepper
Amaranthus
Before PADEP
After PADEP
2.7
2.3
0.8
2.1
1.5
2.2
0.4
1.7
2.5
2.2
1.0
1.1
2.0
6.4
3.3
0.6
2.9
2.9
0.5
0.3
0.7
6.7
5.3
4.7
4.8
1.8
3.7
1.6
3.6
5.3
4.1
2.3
2.3
4.3
18.6
13.3
1.6
4.4
5.7
15.0
4.7
1.5
( percent)
increase
148
130
488
129
20
68
300
112
112
86
130
109
115
191
303
167
52
97
2900
1467
114
_______________________________________________________________________________ 145
District
Crop
Before PADEP
Banana
Cassava
Chinese Cabbage
Eggplant
Okra
Onions
Irrigated rice
Sweet pepper
Wete
Banana
Cassava
Irrigated rice
Maize
Pineapple
Rainfed rice
Sorghum
North ‘A’
Banana
Eggplant
Maize
Onions
Pigeonpeas
Yams
TableD7.3
Year
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
After PADEP
5.8
6.2
10.0
1.2
0.5
0.0
3.3
0.5
2.6
1.8
2.1
1.3
1.5
0.7
1.7
6.4
1.5
0.7
0.2
0.7
0.6
10.7
8.7
15.0
2.7
1.3
9.9
5.8
1.4
4.4
4.5
3.9
4.4
15.9
1.8
1.8
12.3
5.5
1.6
0.8
1.1
3.4
( percent)
increase
84
40
50
125
160
76
180
69
150
86
238
960
157
6
92
267
129
300
Participation and Inclusiveness: Respondents’ Perception in Mwanyanya and
Chachani Villages (June 2009)
Significant Improvement
1
1
1
2
2
2
8
20
22
21
Some Improvement
16
16
14
17
22
36
36
30
27
29
Poor
20
31
25
19
13
14
13
11
11
11
Very Poor
21
12
5
4
3
12
7
5
6
7
_______________________________________________________________________________ 146
Table D7.4
Year
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
Table D7.5:
(June 2009)
Year
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
Democracy: Respondents’ Perception in Mwanyanya and Chachani Villages
(June 2009)
0
0
1
1
1
4
16
21
22
22
Some Improvement
18
18
17
22
27
27
19
21
21
24
Poor
17
27
26
22
14
12
20
11
10
11
Very Poor
26
16
6
2
3
12
8
7
7
6
Corruption: Respondents’ Perception in Mwanyanya and Chachani Villages
15
11
2
0
0
0
1
4
5
5
Some Improvement
5
8
16
9
6
5
8
5
5
6
Poor
45
47
44
39
45
50
47
37
38
38
Very Poor
10
8
5
8
12
22
31
42
43
43
APPENDIX E
Table E7.1: Average Production of Livestock Products before and after PADEP
Average production
District
Product type
Unit
Before
PADEP
After PADEP
Central
Milk (cross)
Milk (indigenous)
North A
Eggs (200 Layers)
West
Eggs (local chicken)
Eggs (200 Layers)
Wete
Milk (indigenous)
Source: MALE, 2008
number
litres
litres
number
number
number
number
litres
20
3
2.5
9
0
12
0
1.5
32
5
4.25
19
152
16
105
3
percent
change
60
67
70
100
100
33
100
100
_______________________________________________________________________________ 147
Table E7.2: Average Production of Crops
District
Central
Crop
Before PADEP
Amarantuhus
Banana
Bitter Aborgen
Cassava
Cucumber
Eggplant
Maize
Okra
Pumpkin
Rainfed rice
Spinach
Tomato
Yams
Chake Chake
Banana
Cucumber
Eggplant
Groundnuts
Maize
Onions
Sweet pepper
West
Amaranthus
Banana
Cassava
Chinese Cabbage
Eggplant
Okra
Onions
Irrigated rice
Sweet pepper
Wete
Banana
Cassava
Irrigated rice
Maize
Pineapple
Rainfed rice
Sorghum
North ‘A’
Banana
Eggplant
Maize
Onions
Pigeonpeas
Yams
( percent)
increase
After PADEP
2.7
2.3
0.8
2.1
1.5
2.2
0.4
1.7
2.5
2.2
1.0
1.1
2.0
6.4
3.3
0.6
2.9
2.9
0.5
0.3
0.7
5.8
6.2
10.0
1.2
0.5
0.0
3.3
0.5
2.6
1.8
2.1
1.3
1.5
0.7
1.7
6.4
1.5
0.7
0.2
0.7
0.6
6.7
5.3
4.7
4.8
1.8
3.7
1.6
3.6
5.3
4.1
2.3
2.3
4.3
18.6
13.3
1.6
4.4
5.7
15.0
4.7
1.5
10.7
8.7
15.0
2.7
1.3
9.9
5.8
1.4
4.4
4.5
3.9
4.4
15.9
1.8
1.8
12.3
5.5
1.6
0.8
1.1
3.4
148
130
488
129
20
68
300
112
112
86
130
109
115
191
303
167
52
97
2900
1467
114
84
40
50
125
160
_______________________________________________________________________________ 148
76
180
69
150
86
238
960
157
6
92
267
129
300
Table E7.3: Perception of the Status of Participation and Inclusiveness
in Mwanyanya and Chachani Shehias (June 2009)
Year
Some Improvement
2000
1
16
2001
1
16
2002
1
14
2003
2
17
2004
2
22
2005
2
36
2006
8
36
2007
20
30
2008
22
27
2009
21
29
Poor
20
31
25
19
13
14
13
11
11
11
Very Poor
21
12
5
4
3
12
7
5
6
7
Table E7.4: Perception of the Status of Democracy in Mwanyanya and Chachani Shehias (June 2009)
Year
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
0
0
1
1
1
4
16
21
22
22
Some Improvement
18
18
17
22
27
27
19
21
21
24
Poor
17
27
26
22
14
12
20
11
10
11
Very Poor
26
16
6
2
3
12
8
7
7
6
_______________________________________________________________________________ 149
Table E7.5: Perception of the Status of Corruption in Mwanyanya and Chachani Shehias (June 2009)
Year
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
15
11
2
0
0
0
1
4
5
5
Some Improvement
5
8
16
9
6
5
8
5
5
6
Poor
45
47
44
39
45
50
47
37
38
38
Very Poor
10
8
5
8
12
22
31
42
43
43
_______________________________________________________________________________ 150

zanzibar human development report 2009 towards pro poor growth

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