Unstable Local Producer’s Institutions and Failure to Utilize Competitive Factor: The Case of Tanzania’s Coffee Industry
Corresponding Author(s) : David G. Mhando
Journal of Humanities & Social Science (JHSS),
Vol. 3 No. 1 & 2 (2014): Volume 3, Nos. 1 & 2, 2014
Abstract
Coffee is one among the important traditional export crops in Tanzania, contributing
to foreign exchange earnings as well as GDP. It is estimated that 400,000 families
depend on coffee-related activities for their livelihood. Although its contribution in
the world market is minimal, Arabica coffee beans from Tanzania are of high quality.
This paper attempts to explore the coffee industry in Tanzania and its challenges. Data
were collected from Tanzania Coffee Board, Japanese Specialty Coffee Association
Exhibitions, as well as interviews with the Head of Suntory Beverage Department in
Tokyo, Japan. The findings indicated that weak policies have resulted in an unstable
situation in the domestic marketing scenario, leading to weak cooperatives, poor
quality coffee, and failure to attain specialty coffee from Tanzania. In addition, no
efforts have been made to develop an international market brand name for
Kilimanjaro coffee, which is famous in the world market for its good taste and aroma.
Consequently, there are many brands of Kilimanjaro coffee in Tanzanian and Japanese
markets that confuse the market about their originality. Based on these findings, it is
recommended that farmers’ organisations should be empowered to play their
expected role in the coffee production and subsequent marketing.
Keywords
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- BACAS. 2005. Final Report on Coffee Baseline Report for Tanzania Coffee Research Institute, Sokoine
- University of Agriculture, Morogoro.
- Banturaki, A. 2000. The Development of cooperatives in Tanzania. Dar es Salaam: Dar es Salaam
- University Press.
- Cooksey, B. 2003. Marketing reforms? The rise and fall of agricultural Liberalization in Tanzania.
- Development Policy Review, 21(91): 67–91.
- Cooksey, B. 2011. Marketing reform? The rise and fall of agricultural liberalization in Tanzania.
- Development Policy Review, 29,(s1): s57– s81.
- Coase, R. 1937. The Nature of the Fir. Economica 4(16): 386–405.
- Commons, J. 1951. The Economics of Collective Action. New York: Macmillan.
- DALDO. 2012. District Annual Report, Mbinga, Tanzania (unpublished).
- Hodgson, G. 2006. What Are Institutions, Journal of Economic Issues, XL (1): 1–25.
- ITC, 2011: The Coffee Export Guide, Third edition, International Trade Centre, Geneva,
- Switzerland.
- ICO,. 2013). Coffee prices-historical data http://www.ico.org/historical. Site visited on 6/11/2013
- Lyimo, F.F. 2012. Rural Cooperation in the cooperative Movement in Tanzania. Dar es Salaam: Mkuki
- Na Nyota Publishers Ltd.
- Maghimbi, S. 2002. Abolition of peasant’s cooperatives and crisis in rural economy in Tanzania. In
- G. Fosters & S. Maghimbi, (eds.). Tanzania Peasantry Economy in Crisis. Avebury: Grower
- Publishing Company Ltd., 81–100.
- —. 2007. Recent changes in crop patterns in the Kilimanjaro region of Tanzania: The decline of
- coffee and the rise of maize and rice. African StudyMonographs, Supplement, 35: 73–83.
- Mchomvu, A., F. Tangaraza & S. Maghimbi 2002. cooperatives and social protection in Tanzania.
- Journal of Social Development in Africa. 17(2): 29–44.
- Mhando, D. G. 2012. Coffee Trap: An assessment of Potential Poverty Risk for Coffee Farmers in Mbinga
- District, Tanzania. LAP LAMBERT Academic Publishing GmbH & Co. KG: ISBN 978–3–8473–4438–4
- Mhando, D.G. & J. Itani. 2007. Famers coping strategies to a change in coffee marketing after
- economic liberalization: the case of Mbinga District, Tanzania. African Study Monographs,
- Supplementary Issue, 36: 39–58.
- —. 2008. Post economic liberalization coping strategies after introduction of one license System
- in Tanzania: The case of the Matengo Coffee growers in Mbinga District, Tanzania. Tanzania
- Journal of Population Strategies and Development, 15(1&2): 44–58.
- Mhando, D. G. & G. Mbeyale. 2010. An analysis of the coffee Value chains in the Kilimanjaro
- Region, Tanzania. NCCR North-South Dialogue, 27.
- Mhando, D. G., T. Haller, G. Mbeyale & E. Ludi. 2013(a). Adaptation to changes in the coffee value
- chain and the price of coffee among coffee producers in two villages in Kilimanjaro, Tanzania.
- African Study Monographs, 34(1): 27–56.
- Mhando, D.G., Ganja, S. K. & E. Monyo. 2013(b). The Impact of Market Liberalization to Members
- of Agricultural Marketing cooperatives Societies (AMCOS): The Case of Moshi and Rombo
- Districts. Tanzania Journal of Education, Humanities and Sciences, 2(1): 61–80.
- Mmari, D. 2012. Institutional Innovations and Competitiveness of Smallholders in Tanzania. PhD
- thesis, ISS, The Netherlands
- North, D. 1990. Institutions, Institutional Change and Economic Performance. Cambridge: Cambridge
- University Press.
- Ponte, S. 2002. Farmers and Markets in Tanzania. Dar es Salaam: MkukinaNyota Publishers.
- Promar Consulting. 2011. High Value Agriculture Study: The African Coffee Industry and Japan Trade
- and Aid – Supporting the Tanzanian and Ethiopian Coffee Industries and their Export
- Promotion. Promar Consulting Tokyo, Japan
- TCB, 2012. Miaka 50 ya Uhuruwa Tanzania na Mapinduzi ya Kilimo cha Kahawa. Moshi, Tanzania.
- Temu, A,A. 1999. Empirical Evidence of Change in the coffee market after Liberalization. A case of
- Northern Tanzania. PhD thesis, Urban University.
- Williamson, O.E. 1985. The Economic Institutions of Capitalism: Firms, Markets, Relational Contracting.
- New York and London: The Free Press.
- Veblen, T. 1934. The Theory of Leisure: An Economic Study of Institutions. New York: Modern Library.
- United Republic of Tanzania (URT). 2002. Coffee Industry Act. Dar es Salaam: Government Printer.
- —. 2012. Coffee Industry Rules and Regulations. Dar es Salaam: Government Printer.
- —. 2012. Coffee Industry Act. Dar es Salaam: Government Printer.
References
BACAS. 2005. Final Report on Coffee Baseline Report for Tanzania Coffee Research Institute, Sokoine
University of Agriculture, Morogoro.
Banturaki, A. 2000. The Development of cooperatives in Tanzania. Dar es Salaam: Dar es Salaam
University Press.
Cooksey, B. 2003. Marketing reforms? The rise and fall of agricultural Liberalization in Tanzania.
Development Policy Review, 21(91): 67–91.
Cooksey, B. 2011. Marketing reform? The rise and fall of agricultural liberalization in Tanzania.
Development Policy Review, 29,(s1): s57– s81.
Coase, R. 1937. The Nature of the Fir. Economica 4(16): 386–405.
Commons, J. 1951. The Economics of Collective Action. New York: Macmillan.
DALDO. 2012. District Annual Report, Mbinga, Tanzania (unpublished).
Hodgson, G. 2006. What Are Institutions, Journal of Economic Issues, XL (1): 1–25.
ITC, 2011: The Coffee Export Guide, Third edition, International Trade Centre, Geneva,
Switzerland.
ICO,. 2013). Coffee prices-historical data http://www.ico.org/historical. Site visited on 6/11/2013
Lyimo, F.F. 2012. Rural Cooperation in the cooperative Movement in Tanzania. Dar es Salaam: Mkuki
Na Nyota Publishers Ltd.
Maghimbi, S. 2002. Abolition of peasant’s cooperatives and crisis in rural economy in Tanzania. In
G. Fosters & S. Maghimbi, (eds.). Tanzania Peasantry Economy in Crisis. Avebury: Grower
Publishing Company Ltd., 81–100.
—. 2007. Recent changes in crop patterns in the Kilimanjaro region of Tanzania: The decline of
coffee and the rise of maize and rice. African StudyMonographs, Supplement, 35: 73–83.
Mchomvu, A., F. Tangaraza & S. Maghimbi 2002. cooperatives and social protection in Tanzania.
Journal of Social Development in Africa. 17(2): 29–44.
Mhando, D. G. 2012. Coffee Trap: An assessment of Potential Poverty Risk for Coffee Farmers in Mbinga
District, Tanzania. LAP LAMBERT Academic Publishing GmbH & Co. KG: ISBN 978–3–8473–4438–4
Mhando, D.G. & J. Itani. 2007. Famers coping strategies to a change in coffee marketing after
economic liberalization: the case of Mbinga District, Tanzania. African Study Monographs,
Supplementary Issue, 36: 39–58.
—. 2008. Post economic liberalization coping strategies after introduction of one license System
in Tanzania: The case of the Matengo Coffee growers in Mbinga District, Tanzania. Tanzania
Journal of Population Strategies and Development, 15(1&2): 44–58.
Mhando, D. G. & G. Mbeyale. 2010. An analysis of the coffee Value chains in the Kilimanjaro
Region, Tanzania. NCCR North-South Dialogue, 27.
Mhando, D. G., T. Haller, G. Mbeyale & E. Ludi. 2013(a). Adaptation to changes in the coffee value
chain and the price of coffee among coffee producers in two villages in Kilimanjaro, Tanzania.
African Study Monographs, 34(1): 27–56.
Mhando, D.G., Ganja, S. K. & E. Monyo. 2013(b). The Impact of Market Liberalization to Members
of Agricultural Marketing cooperatives Societies (AMCOS): The Case of Moshi and Rombo
Districts. Tanzania Journal of Education, Humanities and Sciences, 2(1): 61–80.
Mmari, D. 2012. Institutional Innovations and Competitiveness of Smallholders in Tanzania. PhD
thesis, ISS, The Netherlands
North, D. 1990. Institutions, Institutional Change and Economic Performance. Cambridge: Cambridge
University Press.
Ponte, S. 2002. Farmers and Markets in Tanzania. Dar es Salaam: MkukinaNyota Publishers.
Promar Consulting. 2011. High Value Agriculture Study: The African Coffee Industry and Japan Trade
and Aid – Supporting the Tanzanian and Ethiopian Coffee Industries and their Export
Promotion. Promar Consulting Tokyo, Japan
TCB, 2012. Miaka 50 ya Uhuruwa Tanzania na Mapinduzi ya Kilimo cha Kahawa. Moshi, Tanzania.
Temu, A,A. 1999. Empirical Evidence of Change in the coffee market after Liberalization. A case of
Northern Tanzania. PhD thesis, Urban University.
Williamson, O.E. 1985. The Economic Institutions of Capitalism: Firms, Markets, Relational Contracting.
New York and London: The Free Press.
Veblen, T. 1934. The Theory of Leisure: An Economic Study of Institutions. New York: Modern Library.
United Republic of Tanzania (URT). 2002. Coffee Industry Act. Dar es Salaam: Government Printer.
—. 2012. Coffee Industry Rules and Regulations. Dar es Salaam: Government Printer.
—. 2012. Coffee Industry Act. Dar es Salaam: Government Printer.