AGRICULTURAL AND RURAL DEVELOPMENT: KEY FOCUS OF PRSC -III

The World Bank’s Board of Executive Directors on 8th September 2005 approved a US$150 million credit to support the implementation of Tanzania’s National Strategy for Growth and Poverty Reduction (MKUKUTA). Tanzania’s third Poverty Reduction Support Credit (PRSC-III) provides financial support to close the gap between the cost of implementing key elements of MKUKUTA and the resources available from the government’s own domestic revenue and other donor support.

PRSC-III will help implement the comprehensive structural reforms on which Tanzania has embarked to improve economic growth. Private sector and rural development are the two areas where reforms financed by PRSC-III are expected to have the biggest impact on reducing income poverty in Tanzania. The core reforms are expected in agricultural and rural development focusing on raising agricultural productivity and enhancing the incomes of rural dwellers, where poverty is most widespread and most deeply entrenched.

The measures in rural development will include improving the profitability of agriculture and export products through reduced marketing cost; improved access to markets and to financing; the removal of institutional constraints remaining on rural activities; and correcting the incentives provided by the overall tax regime. Read more