ECONOMIC LIBERALIZATION AND AREAL DIFFERENTIATION OF LIVELIHOOD STRATEGIES IN THE SMALLHOLDER COFFEE PRODUCTION AREA OF THE ARUMERU DISTRICT, TANZANIA

Abstract

Geography is an important and complex mediating factor of the impact of macroeconomic policies on local rural livelihoods. Smallholders in the Arumeru coffee production area, located in northeastern Tanzania, have adopted different livelihood strategies to survive within the regional system under changing macroeconomic conditions. After the liberalization of the market, these farmers substantially retreated from coffee production; this has been most pronounced in the former production center. The alternative livelihood strategies that have been adopted and the net income levels of the sample rural households depend on the location, local environment, and regional system that includes the urban economy vitalized by the liberalization. For instance, horticulture and dairy production have been stimulated by the crosssectoral impacts of the liberalization measures on various activities, including mining and tourism, in different areas of the region. These two agricultural activities exhibit spatial variation within the same system according to the availability of irrigation and the relative ease of transport. Therefore, the geographical incidences of the retreat from coffee production and the possible and/or adopted livelihood strategies are not uniform, and the extent of de- agrarianization has been, on the whole, not significant, and economically stratified.