Tanzania's Pilot Rural Investment Climate Assessment (RICA) measures the economic environment of non-farm entrepreneurs. The pilot assessment has three key objectives: it aims to better understand the rural non-farm economy in Tanzania, shed light on rural enterprise dynamics and business constraints, and reflect on areas where government policies are readily directed to help promote rural non-farm enterprise activity. The RICA is based on an analysis of a unique survey data set collected by the National Bureau o f Statistics (NBS) during January and March 2005, covering enterprises, households, and communities in all seven geographical zones of the country. Some of the main findings of the study are: 1) Rural non farm enterprises matter
2) Tanzanian rural non farm enterprises differ from their urban counterparts
3) Rural trade dominates
4) Labor productivity is low
5) Registration is associated with higher labor productivity
6) The rate of new firm creation appears to be lower than in other African countries
7) A minority of enterprises propels employment growth
and 8) Due to relatively rapid agricultural growth in recent years, demand exists for more rural non-farm economic activity. However, entrepreneurs are now constrained mainly from the supply-side in their response to this increased demand.