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The chapters in part one provides the overall context of light manufacturing in Tanzania. Chapter one presents the rationale for the study, the potential of the sector in creating jobs and prosperity for Africa, and the approach and methodology of the study. Chapter two reviews Tanzania's recent economic performance and prospects and concludes that, despite good macroeconomic performance, the country still needs to pursue structural transformation and diversification. Moreover, despite Tanzania's abundant natural endowments, manufacturing remains a viable source for job creation and prosperity. Chapter three examines the overall business environment among firms of all sizes in light industry in Tanzania. It first reviews the macroeconomic framework, focusing on wages, exchange rates, and interest rates before analyzing the microeconomic issues affecting firms such as export incentives, trade logistics, and access to electricity, land, and finance. Competition, an issue of paramount importance in improving Tanzania's competitiveness, is analyzed next, before a discussion of a potential shortcut for addressing some of the related macro and micro problems.
