oa Business Management Review - Performance of privatised firms in Tanzania

Volume 8, Issue 2
  • ISSN : 0856-2253



Tanzania, like other African countries have carried out privatization of her state-owned firms. The performance of the state-owned sector had been a matter of serious concern to Government and Donors, and upon pressure from the latter the Government undertook privatization within the broad Structural Adjustment Programme. To perform the privatization the Government created the Parastatal Sector Reform Commission (PSRC), whose task with the assistance of relevant Government Ministries, Departments and Holding Parastatal companies, was to manage the privatization process. It is claimed that by June 2002 divestitures had reached 243 out of 36 units and 83 non-core assets had been sold out. This paper examines .the privatization process and progress in Tanzania and in particular the performance of privatized firms. The paper concludes that the Government, with the help of external assistance, was able rapid privatization. The paper however also points out that this was not without problems. Included have been little initiative to enable Tanzanians to acquire the privatized firms, lack of transparency in the privatization process and poor performance in privatized firms. The plight of the workers, both the retrenched ones following privatization and those remaining in the firms is also a matter of serious concern. Worse still, there are no significant performance improvements except in very few of the privatized firms. Lastly, it is recommended that Government carries out monitoring and evaluation of the privatized firms, and where necessary reviews their ownership.

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