The contraction in money supply was mainly attributed to a decrease in net foreign assets of the banking system. The Tanzanian government has made significant progress in opening the economy. One area in which the government seems to making headway is the liberalization of interest rates and the unification of exchange rates. Both are positive moves which should help the economy rebound in FY 1998. For the next ten years principal growth sectors will remain agriculture, industry, mining, and construction, as well as, trade, tourism, infrastructure and technology development.
Output remains predominantly based on small holder production.
Estate cultivation was centered on sisal, sugar, tea, and to a lesser extent coffee, tobacco, rice, wheat and wattle. Traditional exports such as coffee, cotton, sisal, cashew nuts, cloves, tea and tobacco remain the pillars of export income generation. At the urging of the international donor community, the Tanzanian government has recently placed a great deal of emphasis on agricultural export diversification, stressing the switch from traditional to non-traditional exports such as horticultural products, spices, fishery products and manufactured goods. Tanzania's industrial sector contributed approximately 8 percent to the GDP of the nation in spite of disruptive power supply. Liquidity problems, poor management, lack of spare parts, insufficient capital to import raw materials and stiff outside competition from imported goods contributed to the low performance of the industrial sector.