Manufacturing Exports and Economic Growth in Tanzania

Abstract

This study examines the relationship between manufacturing exports and economic growth in Tanzania. The study is based on the export‐led growth model and the virtuous circle to analyse the relationship. Using secondary time series data, the study employed the Autoregressive Distributed Lags (ARDL) approach and the Granger causality test technique for analysis. It was found that manufacturing exports affects economic growth in the long-run; and that, for Tanzania, manufacturing exports are the ones causing economic growth, and not the other way round. Therefore, the study concludes that there is a significant relationship between Tanzania’s manufacturing exports and economic growth. It recommends policies, strategies and further efforts to be made to increase manufacturing products; encourage firms to produce quality products; invest in professional skills, education, and training; and increase external markets for manufactured products