Tag Archives: Zitto

Has Zitto revealed fake news on Tz economic growth?

The Citizen, 2/11/2017

Zitto Kabwe was arrested last week. He must be getting used to this by now, as he’s been held and questioned by the police on several occasions over the past couple of years.

What’s new this time, however, is that along with the by-now commonplace charge of “sedition”, he has been charged under the Statistics Act – the first such charges brought since the Act became law in 2015. Specifically, he and his party, ACT Wazalendo, published their own analysis of official economic data from the Bank of Tanzania (BoT), suggesting that the official GDP growth figures had been manipulated, and that actual growth was 0.1% rather than the BoT figure of 5.7%. And somebody decided that these are sufficient grounds to have him arrested.

I am not an economist and cannot either confirm or reject Zitto’s claim. I hope others will try to do so. But I can put forward some related data on the state of Tanzania’s economy that might help shed some light on the situation.

Let’s start with Zitto’s figures, however. His argument is essentially that up to now, GDP growth in Tanzania has stuck fairly close to the rate calculated using inflation and money supply figures. The most recent data, however, show a marked diversion, led by a sharp drop in money supply. In other words, the two blue lines on this graph stayed fairly close until this year. So something must be wrong with the latest figures, in his view.

Whether or not this argument holds water, however, we can also examine other data that can tell us something about the state of the economy. I have four more charts for you, starting with the money supply (the amount of money held in Tanzania, either in cash or in bank accounts):

It’s up and down a bit, but it shows one thing pretty clear: that growth in money supply in Tanzania has dropped considerably since early 2016. Before that, the amount of money circulating in Tanzania had been growing at around 15% each year. But that has now dropped to around 5% this year.

Next up, let’s look at another important proxy for a nation’s economic health: imports and exports. If the economy is doing well, demand for imported goods and services and production of exports should be on the increase.

When it comes to exports, the figures are up and down, showing no clear trend. But imports of goods and services into Tanzania are down considerable since January 2015: down by roughly 35% in just over two years.

We can also look at credit to the private sector. Again, this can be a good measure of economic health: if the economy is strong, banks will be happy to lend money.

As with imports, so there has been a decline here: prior to 2016, lending to the private sector had grown at a rate of around 20% a year. This has now dropped to just 1% in the latest available figures, for July 2017.

Finally, an indicator that perhaps affects most Tanzanians lives more immediately than any of those presented above: food prices. This is a complex area, as higher prices can be good for producers just as they are bad for consumers. But price increases would suggest demand is outstripping supply. And if prices go very high, it would suggest there might be a serious food shortage.

It’s good to see that prices have come down considerably since the start of the year – when reports and evidence of food shortages were widespread, despite initial government denials. But it’s noticeable that prices are still well above where they were at this time in the season in 2015 and 2016.

I want to end with two questions:

First: Bank of Tanzania figures tell us that money supply growth is down, imports are down, credit to the private sector is sharply down, and food prices remain high. What does this tell us about the state of the Tanzanian economy?

And second: an opposition politician is arrested and charged for pointing to what he describes as significant anomalies in official data. What does this tell us about the state of Tanzanian democracy?


This post originally appeared on mtega.com.

Lowassa joins Chadema and UKAWA, but what happens next?

The Citizen, 20/07/15

The Citizen, 20/07/15

So finally it has happened. After being unceremoniously dumped out of the race for the CCM presidential nomination, followed by more than two weeks of will-they-won’t-they flirtations and negotiations, Edward Lowassa has been welcomed into Chadema’s embrace. With the other parties in the Ukawa coalition (CUF, NCCR and NLD) apparently in support, it looks like Lowassa is set to become the coalition’s presidential candidate.

As a former Prime Minister, Lowassa is the most high ranking CCM figure to switch parties since Tanzania introduced multi-party politics. He was many people’s favourite to win the CCM nomination, and this move has the potential to dramatically shake up Tanzanian politics – and the forthcoming general election. Continue reading

Alliance for Change and Transparency? Zitto and ACT Wazalendo in cartoons

The (Tz) Guardian, 29/3/15

The (Tz) Guardian, 29/3/15

The long-awaited launch of ACT Wazalendo as Tanzania’s newest political party finally took place on Sunday. As expected, Zitto Kabwe, whose long-running battle with his former party, Chadema, recently came to an end, has been appointed as party leader.

Perhaps the new party’s most notable policy position is their insistence that all party leaders much make a declaration of their assets, which will be posted online. Continue reading

Telling the Escrow / IPTL story through cartoons: Are we going to see accountability?

It could be a very big day for Tanzania today. The parliamentary Public Accounts Committee, under the determined leadership of its chair, Zitto Kabwe, promises to present its findings on the IPTL / Escrow audit report as prepared by the Controller and Auditor General (CAG), despite apparently considerable pressure through official channels from the Prime Minister, Mizengo Pinda, the judiciary and others, and through unofficial (and unpleasant) channels from unknown sources.

For background on the case and why it is so significant, I recommend two excellent articles in the Citizen newspaper, which has reported steadfastly on this topic for many months:

In all, it is said to be a case involving as much as Tshs 321bn ($185m). And it is said to go both deep into government and high up.  Hopefully we will understand this much better later today.

But for now, let’s celebrate one aspect of the media coverage of this story – the creativity and audacity of the cartoonists. Continue reading

Apparently everyone wants transparency in Tanzania’s gas contracts. Lets get them online

contract transparencyLast weekend, Statoil management finally broke their silence on their leaked contract for gas production in Tanzania. In an interview with The Citizen newspaper, Statoil’s Country Manager for Tanzania, Øystein Michelsen, spoke at length, including on the subject of contract transparency:

“Statoil respects the position of any government in the countries where we operate with regards to whether the contracts are made publicly available or not. In a number of countries where we operate the contracts are publicly available and Statoil does comply with that position. In Tanzania, the contracts are confidential and for that matter, Statoil also complies with that position.” [my emphasis]

“In 2012, Transparency ranked Statoil as the most transparent company among the world 105 largest publicly traded companies [see here]. We will continue to promote transparency, but we will also respect contract terms and the obligations we have towards our partners.”

The Citizen used this as their headline: “Investors accuse govt of keeping contracts secret.” And the point is clear: Statoil has no objection to contract transparency. Continue reading

Statoil gas contract: Tanzania’s media picks up the story

For background on this post, see my previous posts on the topic:

– – – –

Majira 7/7/14

Majira 7/7/14

Over the weekend, the Tanzanian press finally began to pick up the leaked Statoil PSA story, prompted by Zitto Kabwe’s comments on the issue (in English and Swahili).

The Guardian made the story its front page lead on Saturday (5/7/14), while other papers caught up on Monday (7/7/14): This Day (front page lead); MwananchiNipashe and Mtanzania (second or third on front page); and Daily News – see slideshow below. Majira had a cartoon today (see above), as did The Guardian on Sunday (see bottom of post). This Day also printed in full my piece in African Arguments last week.

Continue reading

Chart of the week #15: Getting a good deal from natural gas?

Kipanya in Mwananchi, June 2014

Expectations: Kipanya in Mwananchi, June 2014

Natural gas is a game changer in Tanzania, both economically and politically. The latest reports suggest that there may be as much as 51 trillion cubic feet available, not huge by global standards, but enough to have raised expectations sky high – see cartoon. The public and policy makers are excited, and it’s already having significant effects on both local and national politics.

Zitto Kabwe wrote recently:

“One Minister stated in the Parliament that “with the natural gas reserves Tanzania has, poverty will be history”. How I wish it was that simple! A plus and minus equation. Unfortunately the reality is opposite. There are chains of evidence that resources, due to many factors engraved within a ‘lesser’ leader, may lead to curse.”

Continue reading