This chapter provides a description and an analysis of the relationship between government and the business sector, mostly large firms, a key aspect of Tanzanian development. The situation observed today, with a lack of a well-articulated industrial policy and the executives volatile attitude with respect to market rules and the role of big business, may be seen as strongly path-dependent in a country that went in a few decades from a colonial market economy to a socialist nationalized economy and then transitioned back to the market amid great disorder. The chapter emphasises several key challenges in the regulation of the business sector. The most important of these is the strong link between businesspeople and factions within the dominant political party, whose interests may diverge from those of the executive. The chapter elaborates on the need for better central control by the government to counteract this situation, while drawing the lessons of a move in that direction by the previous president. In her discussion of the chapter, Hazel Gray underscores the downsides of too much centralisation while emphasising the regional dimensions of Asian-led firms’ strategies.

For the Chinese, the nineteenth century was a period of waking up and realizing why the Middle Kingdom had fallen behind the West in economic growth. Not only had this large and once prosperous country fallen behind economically (with its apparent failure to industrialize), it also fell prey during the two Opium Wars to the same country that first embarked upon the Industrial Revolution – Britain. Consequently, a long period of autarky came to an end. While initially China was forced to open up only several “treaty ports” for trade and commerce, eventually the entire country was subjected to the influences of the West, and in spheres that went far beyond trade and commerce to also include industry, education, and even politics. By assembling data from a variety of previously untapped historical sources, this chapter attempts to analyze the Western influences that shaped the economic trajectories of late imperial China.

Starting from remarkable divergences and similarities of pathways into market liberalism, the chapter investigates progress and setbacks of economic reforms. The first section indicates key factors for divergences and similarities, the second section discusses the divergence of pathways of post-socialist capitalisms, the third, similarities, the fourth the results of economic reform paths until 2008, and the fifth the preliminary setback of the Eurozone crisis and its aftermath. As the title indicates, the necessary economic reforms in many countries of the region could be carried out only by measures that constituted a temporary burden for the population, such as unemployment, significant setback of household income, insecurities regarding pension provision, and labor migration. But the illusion of a better life, especially for the children, after a phase of hardship kept the ball rolling. In the first decade of the 2000s economic reforms showed positive results – not only in countries which became European Union member states but also in disadvantaged countries such as the West Balkan ones. The economic crisis caused by the Euro-American banking system in 2008 and after hit the countries of Central, Eastern, and Southeastern Europe comparatively hard. Paradoxically, the West Balkan states, chronic losers from transition, were harmed less – due to their low integration into the global economy.