Institutional and Operational Bottlenecks in the Rice Value Chain and Export in Tanzania

The second most important staple food and a commercial crop in Tanzania, improving the production and trade of rice can substantially contribute to agricultural growth and rural welfare. Based on this rationale, the government of Tanzania designed two national rice development strategies in 2009 and 2019, aiming to double production through commercialization and introduce Tanzanian rice to new export markets. Production increase has succeeded to a great extent. However, this success primarily stemmed from an expansion of the area under irrigated rice cultivation rather than from the envisioned land productivity increase.

Moreover, rice export lagged behind the envisioned levels. In explaining why productivity remained limited, several studies pointed to low fertilizer use, lack of access to credit, and infrastructural weaknesses as some of the most significant problems. Still, transaction costs and institutional bottlenecks in value-chain coordination between diverse actors are under researched.

In order to contribute to addressing this gap in the literature, this study focuses on exploring searching and information, bargaining, and enforcement costs in operational stages of rice value chains and how macroeconomic regulations, such as import and export bans, influenced these transaction costs. The research is driven by a qualitative and exploratory agenda. Primary data collection mainly drew from interviews, document analysis, and observations during fieldwork. Fieldwork was conducted in October 2021, focusing on Mbarali (Usangu) in the Mbeya Region, and reached 32 informants in total.

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