The impacts of privatization on the manufacturing sector: the case of cement industry in Tanzania

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University of Dar es Salaam
The study focuses on the impact of privatization on the performance of the manufacturing sector-the case of cement industry in Tanzania. It sets out the following objectives to be achieved: To examine whether or not privatization has improved labor productivity in cement industry and examine the impact of privatization on the profitability of cement industry. On the basis of time series data which was collected for the period between 1980 and 2005. The Johansen integration and error correction modeling approaches have been applied. Overall, the results show that the errors in the integration regression are stationary at level. These tests support integration. A comparison of computed ADF and PP test results supported integration between the dependent variables and its fundamentals. The following results were obtained from the test: (i) privatization of cement industry has indeed led to more profitability. (ii) The ownership change has resulted into the negative impact and insignificant to labor productivity, the reason is that all the three plants are equipped with such modem and sophiscated machinery hence labor absorption is minimal. An important policy implication drawn from this study is that, first, capital intensive should be opted in order to attain high level productivity and faster economic growth. Secondly, gradual adjustment should be adopted, so as to make resources to have more time to adjust to the new system.
Available in print form, East Africana Collection, Dr. Wilbert Chagula Library, Class Mark (THS EAF HD9739.T34K56)
Privatisation, Manufacturing sector, Cement industry, Tanzania
Kingdom, S (2007) The impacts of privatization on the manufacturing sector: the case of cement industry in Tanzania, Master dissertation, University of Dar es Salaam.