Press Corporation, a large diversified Malawian company, was the personal property of Kamuzu Banda who ruled Malawi as a dictator for thirty years from independence in 1964. The history of Press is analysed in order to generate insights into the relationship between politics and economics in Africa. Comparative references are made to the experience of East Asian countries, as there are important similarities between their development paths and that of Malawi under Banda. The activities of Press Corporation were, in general, similar to parastatal companies elsewhere in Africa but, unlike the latter, Press was profitable and viable as a commercial entity. This challenges the idea that there is a compelling logic in African patrimonialist politics which necessitates parasitism on the economy. The experience of Press points to the value of such large multisectoral companies, as they can mobilise scarce local savings and channel them as venture capital into areas where investment has large external benefits, while the discipline of the profit and loss account in the company is not lost.

Van Donge's comment on my reassessment of agrarian change on the Uluguru Mountains, Tanzania, raises a number of issues that go beyond the specificities of the location under scrutiny. Before dealing with these, however, let me restate my argument, which van Donge has reconstructed only selectively. In my article (Ponte 2001a), I argued that rural households are not ‘trapped in decline’ on the Uluguru Mountains, as depicted in previous literature. Although agriculture is not going through an easy transition in the area, and some options are becoming more limited, others are being more skilfully utilised. On the Uluguru Mountains, land scarcity is the main feature of agriculture; deforestation and soil erosion are major problems; and inputs have become increasingly expensive. Under these circumstances, the main ways households can improve their quality of life – short of leaving the area altogether, and in addition to relying on remittances from outside – are to expand land cultivated in other locations, to experiment with alternative farming systems, and to increase non-farm incomes. I observed that Uluguru households were doing all of these in the mid-1990s, and that their income levels and housing characteristics had improved. This was intriguing and challenging to me, since farmers' adaptations to changing markets had not led to higher incomes in other areas that I had researched in Tanzania. Finally, I suggested that economic diversification can play an important role in improving rural livelihoods, but that this process is more likely to take place in locations with well-established economic ties and relatively good access to major markets.

Van Donge has a variety of problems with my argument. These can be grouped around three main themes: (1) issues of methodology; (2) a perceived misunderstanding of his argument; and (3) the impact of liberalisation. Due to space limitations, in my reply to van Donge I deal with these larger themes. A more detailed response covering specific evidence and technicalities is available from this author and has been sent to van Donge.

This paper analyses the effects of privatisation and deregulation of the Dar es Salaam transport system. It starts with an account of the decline of the government-owned transport company and the first opening of the market to private buses in 1983. The analysis then moves to the progressive deregulation of the sector and its impact on transport supply. Competition between private operators in the oversupplied market manifests itself in non-compliance with safety rules, and inefficiencies in the fare structures. Labour relations with the private sector are then examined to illustrate the logic of the market. The results of a questionnaire answered by 668 workers suggest that the reaction of casual workers to exploitative conditions of employment characterises many aspects of the operation of the transport system. The impact of deregulation is therefore most clearly to be seen in the nature of labour relations within the sector, and it is argued that there is a need for state regulation to monitor and enforce conditions of employment within the private sector if service provision is to be improved.