Aid dependency and domestic resource mobilisation 532. Several obstacles to macroeconomic stability and economic growth are identified in the CSAR. One of these is dependence on external aid. According to the CSAR, dependence on foreign financing is still high but is improving, having dropped from 40 per cent in earlier years to 34 per cent in 2009/10 on the Mainland. Estimates for Zanzibar are 50 per cent. Government is endeavoring to address this problem through greater domestic resource mobilisation, in part. However, these efforts are constrained by low levels of income and the Tanzanian Revenue Authority’s struggle to collect more taxes. One sector that poses enormous challenges in this regard is the mining sector. The CSAR concludes that Government loses hundreds of millions of dollars to low royalty rates and unpaid corporate taxes. Various studies and reports are cited to this effect. ll. Findings of the CRM 533. Tanzania has made significant progress in promoting macroeconomic stability for sustainable development. As noted in Chapter Two and above, economic growth has been respectable. However, more progress is required in the area of fiscal balances. Inflation remained above the 5 per cent target and jumped to 10.3 per cent and 12.1 per cent in 2008 and 2009, respectively, before falling to 5.5 per cent in 2010. The current accounts deficit has widened and the currency has depreciated. The most important area of concern identified by the CRM is the quality of current economic growth and the attendant impact on structural transformation, employment, poverty and inequality. In essence, the CRM is of the view that Tanzania is experiencing growth without attendant development. The CRM believes that this is not sustainable and poses serious challenges to social and political stability. Growth rates 534. The CRM noted that the 6-7 per cent economic growth rates of the past five years represent improvements from the situation that prevailed in previous years. However, while these rates are respectable, they fall far short of the growth rates required for the vision of becoming a middle income country by 2025 to be achieved. For this, consistent double-digit growth rates would be required over the next decade. In this regard, the CRM noted that the planned economic growth rate under the Tanzania Five Year Development Plan 2011/2012-2015/16 is only 8 per cent over the plan period, followed by annual growth rates of 10 per cent, from 2016 to 2025. It is doubtful that these growth targets would suffice to ensure the achievement of Vision 2025. Accelerating the growth target over the next decade is, therefore, an issue that needs to be revisited. Drivers of economic growth and development, economic diversification and pro- poor growth and development 535. A key challenge facing the Tanzanian economy is how to broaden the drivers of economic growth and development away from a few sectors. Thus far, the main triggers of economic growth and development have been the mining and service sectors, notably telecommunications and the financial sector. As a result, service sector contributions to added value in the economy jumped from 36 per cent in 1990 to 47 per cent in 2012. In comparison, the value-added of agriculture to GDP fell from 33 per cent in 2000 to 29 per cent in 201089. Agriculture sector productivity has been below its potential due to slow introduction of improved technologies, high transport costs , and inadequate market competition. Obstacles to the growth and development of the economy as a whole and to private sector development have been poor infrastructure, especially insufficient power supply and limited transport facilities, particularly in rural areas. This has led to increased costs of inputs, high transaction costs, and low productivity. Tanzanian economic growth and development, therefore, requires effective and efficient public infrastructure investments, especially in energy, transport and water. 536. The Government of Tanzania at the very highest level is aware of the need for more investments in infrastructure, agricultural stimulus measures, and rural development if problems of unemployment, poverty and inequality are to be addressed effectively. This awareness, commitment and strategy to tackle these problems are reflected in the Tanzania Five Year Development Plan 2011/2012-2015/16 and the Tanzania Agriculture and Food 89 Tanzania Country Brief, World Bank, April 2012 and World Development Indicators, 2010, World Bank. 116