Global turbulence and vulnerabilities

Nyerere was quick to realise, from the on-set of Tanganyika’s political independence, that change in institutions and in mindsets of the people lay at the heart of national social and economic transformation.

Nyerere: Change and Principles
He was emphatic about the centrality of the people being the shapers of change as opposed to being reactive to change. He was concerned though about the delicateness of striking the right balance and even of navigating clashes between the imperative of upholding principles and the pursuit of efficiency and equality. True to his quality of leadership, he admitted about the lack of simple or universal answers to such conflicting conditions which were sometimes were seemingly of a static character but also often dynamic.

It is in this broad context that in the introduction to his first book, ‘Freedom and Unity’ Nyerere wrote that there was no choice “between change or no change; the choice for Africa is between changing or being changed-changing our lives under our own direction, or being changed by the impact of forces outside our control”. That was in 1966. You could say,to a large extent, that Nyerere was prophetic in his assertion and, indeed, during his full leadership as President of the United Republic of Tanzania, he stubbornly stuck to such leadership philosophy.

Age of Unreason
Yet in the brave new world, which we now live and which has consistently been described in different leading books in the past two decades as the “age of unreason”, the age of “thinking the unthinkable”, the age of “the black swan” and the “age of uncertainty” one wonders whether Nyerere’s philosophy about “change” could stand the test of sanctity.

Greenspan and New World
The revered US Federal Reserve Bank Chairman, Alan Greenspan, has contextually written in his magisterial book, ‘The Age of Turbulence-Adventures in a New World’ that “the new world we live in is giving many citizens much to fear, including the uprooting of many previously stable sources of identity and security. Where change is most rapid, widening disparities in the distribution of income are a key concern. It is indeed an age of turbulence, and it would be imprudent and immoral to minimize the human cost of its disruptions.

“In the face of the increasing integration of the global economy, the world’s citizens face a profound choice: to embrace the worldwide benefits of open markets and open societies that pull people out of poverty and end up the ladder of skills to better, more meaningful lives, while bearing in mind fundamental issues of justice; or reject that opportunity and embrace nativism, tribalism, populism, and indeed all the ‘isms’ into which communities retreat when their countries are under siege and they cannot perceive better options”.

Tanzania came face to face with embracing the ‘isms’ that Greenspan refers to in his book during its most difficult period between 1980 and 1985. In spite of the evident economic turbulence and the vulnerabilities, which the Tanzanian economy was affronted by, some positively, emanating from the war to liberate Uganda from a military dictatorship of Idi Amin Dada,the government under Nyerere failed to quickly address the serious shortcomings featured in the management of the socialist economic policies by adopting“better options”.

Tanzania’s ‘Rational Exuberance’
Tanzania, today, may not have found lasting clarityabout its economic policy much as it continues with what one may describe as “rational exuberance” in what it executes as policy, often linked to the Development Vision 2025, but again purely in preamble terms.
The point of this article is that what Nyerere referred to as “the external economic forces” that are outside the control of nation states actually no longer distinguish the rich countries from the poor or developing ones.

Yes, the less developed countries find themselves more vulnerable because their capacity to withstand the impact of turbulence is much lower. However, in the context of globalization, with its calculus of economic interdependence, even the rich world suffers, proportionately.

In this vein, however, developing countries like Tanzania must take Nyerere seriously about the importance of preparedness; about being well organized to understand where lies the national economic strengths that can mitigate externally-induced vulnerabilities. I believe that when Nyerere talked about “to plan is to choose” what he had in mind is precisely the national determination of policies and social and economic measures that could make Tanzania not only achieve self-reliance in its basic needs but would also protect the national economy from external shocks and vulnerabilities.

Global Economic Crisis
I believe that many Tanzanians in political leadership, in policy making, in business, and in the public domain generally are well seized of the uncertainties in the present global economic environment. There are clear fears that the global economy may fast be returning to the kind of financial and economic crisis that was faced in 2007/2008 but different reasons. And that is more worrisome. In other words, there are no lessons, basically, to be learnt from the previous crisis.

Yet here in Tanzania there is a message of “exuberance” from the Bank of Tanzania about the strength of the Tanzanian economy. We are told all is well. No need to panic; that the on-going fragilities and the roller-coaster dynamics in the commodities, stock and money markets in the global economy are in fact well taken care of in our fiscal and monetary policies and measures during 2016. Hallelujah!

I am one person who has known Prof Benno Ndulu, our Bank of Tanzania Governor, for many years and have unshakeable confidence in his intellect and competence. In Dr Mpango, we also have a first class brain as Minister for Finance and Planning. As such, we have an amazing duo at the leadership of the Tanzanian economy. But many of us also know that even the best and the brightest in the developed world have found themselves unable to save their economies from economic disasters!

No Monopoly of Economic Wisdom
We learn from history of knowledge that nobody can claim monopoly of wisdom. Actually, to revert to Nyerere’s quality of leadership, Mwalimu was at his best when he consulted what many of us would regard as illiterates about serious issues of development.

Nyerere respected “indigenous” knowledge where he thought it was relevant. Of course, it elevated his esteem and thus his political leadership. But he also gained a lot about how best to go about mobilizing a highly illiterate rural population to understand and accept modern ideas about their own economic liberation.

Conclusion
Tanzania cannot escape from the current global economic turbulence and crisis. The impact of the crisis in most countries is destabilizing. In next week’s piece we will delve into such impacts and how Tanzania cannot escape vulnerability.

The author is the immediate former Secretary-General of the East African Community.