Failure of Structural Adjustment Programme

2552 Words Jan 18th, 2012 11 Pages
INTRODUCTION
According to Collin dictionary government is the group of people who are responsible to govern country.
Christian council of Tanzania and Tanzania Episcopal conference define government as the chief agency for organizing and in the end of controlling both development and order in the society. Also it is an organized body of persons and institutions that form an agency or machinery of the state which formulates, expresses and realizes the will of state. Therefore, government consists of the activities, methods and principles involved in the governing a country or other political unit.
Government failure is the public sector analogy to market failure and occurs when a government intervention causes a more inefficient
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The justification for nationalization of private firms and extensive involvement of the state in productive activities was the ability of the state to control negative externalities, exploit economies of scale and operate firms at officially optimal level, the outcome proved otherwise for Tanzania. The government failure occurred in the following ways;
The state owned cooperation turned out to be inefficient in almost all areas of their operations. For example many supply companies operated below standard such as National Milling Cooperation which was supplying food stuffs like maize, packed maize flour, rice and wheat causing higher demand in urban areas. Another company was Regional Trading Company (RTC) for supplying commodities like sugar, soaps, wine from Dodoma, and these caused shortages of the commodities.
Due to lack of fund from central government health services, water, education (especially primary schools) remained a big problem in both urban and rural areas. The government operation in providing these social services was highly contributed by among other things inadequate foreign exchange as the country relied much on agricultural products which did not competed strongly with the same crops from other countries in
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