Contribution of Agriculture Sector to the Tanzanian Economy

This paper was undertaken to estimate the contribution of the agriculture sector to the Tanzanian economy. The study focused on time series data collected for the period of thirty years (1981 2010) in Tanzania Mainland. However, the Mean Model was employed to estimate the contribution of agriculture sector to the Tanzanian economy. Moreover, the significant contribution of crops, livestock and fisheries subsectors to the Agriculture Gross Domestic Product (AgGDP) was calibrated by a Multiple Regression Model. The empirical study revealed that agriculture sector is the key contributor to the national economy by accounting 25.88% of the national economy, contributed by crops subsector (18.93%); livestock subsector (4.70%) and fisheries subsector (2.25%), respectively. This contribution makes the agriculture sector to be the second largest sector to contribute to the national economy after services sector which accounts 44.30% of the national economy. Hence, the study concluded that since agriculture sector has significant contribution to the Tanzanian economy, therefore, agriculture policy formulated and implemented by the Tanzanian government should focus much more on agriculture sub-sectors (crops, livestock, and fisheries) as the major contributors to the Tanzanian Gross Domestic Product (GDP) in general and Agriculture Gross Domestic Product (AgGDP) in particular.