Thayer Watkins
Silicon Valley

The Tanganyikan Groundnuts Scheme

During the late 1940s the British government tried to create vast plantations in Tanganyika (now known as Tanzania) for growing groundnuts (peanuts). Although long ago abandoned, the project is still worth reviewing as an experiment in public enterprise.

The original proposal for clearing brush land in East Africa and planting peanuts came from Frank Samuel, the managing director of the United Africa Company. This company is a subsidiary of the large British corporation Unilever. Among other things, Unilever produces soap (Lux and Lifebuoy) and margarine (Stork and Blue Band) and Frank Samuel was responsible for supplying the vegetable oil required for these products. Mr. Samuel foresaw a world shortage of vegetable oils and knew of vast unused areas of East Africa which seemed suitable for agriculture. When Mr. Samuel made inquiries in the Colonial Government he found the director of Agricultural Production of Tanganyika had also been considering what this land could be used for. He suggested to Mr. Samuel that 20,000 acres of peanuts be grown on rotation on l00,000 acres; the remainder was to be sown with other legumes or fodder for livestock. Frank Samuel believed that a private company would face insurmountable difficulties gaining approvals from government agencies for buying rationed equipment and supplies. He presented his five-year plan to clear 2.5 million acres for a test program in Africa to the newly elected Labour government just at the time it was calming the public's fear that the food oil ration would be cut.

The Ministry of Food under an ex-Marxist, John Strachey, quickly commissioned a study of Samuel's plan. The commission was headed by John Wakefield who previously had been Director of Agriculture in Tanganyika. Wakefield had long been concerned about rural populations outgrowing their food supplies and moving into what he saw as the social morass of shantytowns around the cities. He saw part of the food shortage as due to inferior agricultural practices which led to exhaustion and erosion of the soil. Wakefield saw Samuel's plan as a practical way to solve not only the food oil problem of Britain but also the economic and overall problems of the British Colonies

The Wakefield Mission completed its reports in three months, nine weeks of which were in the field. The Mission looked for red, sandy soil suitable for peanuts in areas with few inhabitants. Their first choice was in the Southern Province of Tanganyika, but they also reported favorably on Kongwa in the Central Province where they found natives successfully growing peanuts on small plots. Unfortunately, Kongwa is on the borderline of the area of adequate rainfall but practically no data was available at that time.

Altogether Wakefield recommended £24,000 be appropriated to clear 3.25 million acres over six years. Areas of Kenya and Rhodesia were designated as well as southern, western and central Tanganyika.

Wakefield, of course, wanted to make an objective evaluation of the Sanuel's plan but his predelictions subtly influenced his assessment. First, be foresaw widespread famine unless marginal; i.e., difficult; land was brought into cultivation. Therefore, the mere existence of difficulties was not likely to deter him. Second, he felt African farmers needed to abandon their traditional methods but they would not do so unless they saw the new methods demonstrated. He was conscious of possible spillover effects but implicitly assumed the methods to be introduced would be economically superior. Wakefield, because he felt that some solution like Samuel's plan had to be found, was therefore inclined to approve the plan. An economic perspective emphasizes that only by saying no to the poorer projects can there be enough resources to implement the best projects. Alan Wood summed the matter up in this way

You have said the worst that can be said against the Wakefield Report, and the most important thing worth saying, in pointing out that they were proposing a colossal engineering and agricultural revolution, something comparable on a small scale to the Russian Five-Year Plans, without even realising what they were doing.

On brush clearing the Wakefield Report remarked, "We would also suggest that the establishment of the project would be accelerated if firms already equipped with the necessary machinery were engaged on contract for the initial land clearing." In other words they assumed that somebody knew how to do the job when in fact, no one knew how and the proper equipment and techniques had not yet been invented. Furthermore, the above statement indicates the logistics of the operation were enormously underestimated.

The Labour Government accepted the Wakefield Report and approved the plan. A public corporation was created to run the project from London and Major-General Desmond Harrison was placed in charge of the operations in Tanganyika. John Strachey, Minister of Food, and other politicians saw the project as a military operation but they failed to realize that cost is unimportant in military operations whereas in growing food all costs must be covered. To make matters worse the project did not involve the advance planning and preparation of a real military operation. Instead, as Alan Wood notes, the operation was carried out according to politicians' false conception of a military operation.

A team was sent out to test the fertility of the soil in the various possible locations for the project. The result of this survey was a set of locations of suitable fertility for growing peanuts.

Henry Morton Stanley (of Stanley and Livingston fame) described the thick low scrub of Tanganyika as "an interminable jungle of thornbushes." A Boer farmer called it, "mile after mile of damn-all." Alan Wood says of it,

In patches the thickets of scrub are impenenetrable. A rhinoceros can force a way through, a snake can wiggle through: but no size or shape of animal in between. Except a bulldozer.

In the face of these formidable conditions General Harrison set up shop at Kongwa in the Central District. The decision to develop at Kongwa was a major error, perhaps the most crucial error of the project. The Wakefield Commission recommended initial development in the Southern District but there was no port or railroad connection there whereas Kongwa was not too far from the rail line out of Dar-es-Salaam. At Dar-es-Salaam there was not only a port but also facilities for administration and storage. The Southern District had large trees whereas Kongwa was covered mainly with brush. In short, Kongwa would have been the best location if only the soil and climate were actually suitable for growing peanuts.

The clearing of the land entailed expected and unexpected difficulties. An example of the latter was that some trees harbored bees so vicious that bulldozer operators who were stung had to be hospitalized. These bees are the ones which were hybridized with American bees produce the strain of bees known as killer bees. The African bees are the unhybridized or undiluted version of killer bees. The crews in the field, when they were allowed to, found ways to cope with the difficulties. One very effecctive and productive procedure that they developed was to use the bulldozers in teams of three rather that having them work separately. Two bulldozers linked by a long, strong chain could cut a swath through the brush while the third bulldozer could push over any trees resisting the chain. Usin this method three bulldozers could clear forty acres a day whereas working separately they could clear a total of fifteen acres.

The land clearing crews needed a particularly strong chain for this method and ordered ship anchor chains. Initially some administrator in London, unable to think of any use for a ship's anchor chain in the Tanganyikan bush, cancelled the order. Eventually the crews got the anchor chain but only after an unnecessary delay due to the overcentralization of the project.

The isolation and supply problems of the Tanganyikan interior were highlighted when one early team found that their first breakfast consisted of ham and forty eggs piled on one plate to eaten with one knife, fork and spoon.

At Kongwa the crews found that the clearing the land of brush, difficult as that job was, was only a small fraction of the total effort required to prepare the ground for planting. The bigger job was plowing through the roots. The root cutters were destroyed in a few hours and it was soon realized that there was no equipment available or even invented that was adequate for the task. With great effort and frequent replacement of equipment the ground was plowed and the peanuts were planted.

But the heartbreaks were not over even after a good crop was growing. The soil at Kongwa was mixture of clay and sand. Although it was easily worked when moist it turned concrete hard when it dried out. Peanut plants grow above ground but after the blossoms have been pollinated the plant droops over and the actual peanuts grow underground and therefore cannot be harvested after the rains stop and the ground dries and hardens. When the administrators criticized the team that surveyed the soils that team replied that they had been asked to test the fertility of the soils not their compactness.

The £ 49 million expended was virtually a total loss. British consumers saw no additional food for their tax money. Alan Wood, himself a socialist, considered whether the project being a public enterprise rather than a private, profit-making endeavor had been the cause of the failure. He concluded that the principal decision-makers could not have worked any harder had their own capital been at stake. He knew from personal observation that they worked all of the time, from early morning until late at night. According to Wood,

They worked too hard. They were themselves into such a state of weariness, fever and fret that they could not think ahead.....Too much has been written about the benefits of capitalism in providing the driving force of the profit motive. What is more difficult to replace is the function of the price mechanism in dividing up decisions among a large number of different people. The trouble was not that General Harrison was a stupid man or an incompetent man; He was plainly a man of great ability. The trouble was he carried a heavier burden than any man could bear. (Emphasis added.)

What Wood fails to realize or admit is that it is not so much a matter of how long people work but how effectively. The profit motive not only induces people to put forth more effort but to utilize the resources under their command, including their own time, more efficiently. Personal financial responsibility forces managers to delegate authority when cirmumstances require.

Alan Wood identifies overcentralization and cost-plus contracting of land clearing as the most important flaws in the project. The operations of the Scheme were far too complex for any board of directors in London to run. It was not merely a matter of having people at the site of the project for, in fact, Kongwa may well have been overstaffed; it was a matter of people on the site having decision-making power. There were too few with such power and they were kept busy trying, unsuccessfully, to keep track of the operation. As Wood says,

The air of Tanganyika was thick with flying executives. They were always either coming or going: they wore themselves out: they never came to earth long enough to sit down and collect their thoughts....[T]he unfortunate Area Managers spent half their time waiting on the airstrips for people from Headquarters to arrive, or hanging around airstrips waiting for their planes to take off.

Another chronic problem was unrealistic forecasts. The Scheme had grown for 20,000 acres to 2.5 million acres to 3.25 million acres when it was officially approved. The target number of acres of peanuts for the first year (1947) was 150,000 but equipment was delayed. People associated with project talked about 150,000 acres for the second year. Alan Wood says,

I knew that I could not, for the life of me, see how 150,000 acres were to be cleared in 1948, but it was only after four months that I realized those running the scheme had not the remotest notion either....At the time I was in East Africa I was still told confidentially that between 125,000 and 145,000 would be achieved: and I did not say much, assuming that, as a newcomer, people were not yet ready to take me into their confidence on the state of affairs. It was only later that the horrible truth dawned on me; my informants were not trying to deceive me: they had simply deceived themselves.

By August the forecasted acreage to be planted fell to 128,000 acres, by October to 70,000 to 80,000 and by November it was down to 60,000 acres. Actually by planting time less than 10,000 acres of the brush at Kongwa had been cleared and rooted. Some 20,000 acres of dry lakebed land which required little clearing and rooting were also planted. Another 11,700 acres at Kongwa was planted even though it had not been properly rooted and leveled.

The unrealistic forecasts were not just a bit of whimsy; they led to real waste. For example, based upon the official forecasts 4,000 tons of peanuts were purchased for seed in 1947 but only a fraction of this amount was actually planted. By the end of the second season's harvest, after two years of effort and £ 25 million had been expended, only 2,000 tons of peanuts had been harvested, 50 percent of what had been originally purchased as seed.

During the last stages of the Scheme there was a desperate attempt to salvage the project by planting sunflowers. For sunflowers the land at Kongwa did not have to be rooted and leveled nor did their harvest require any digging up of the hard, dry ground. There was some fear after the planting of the sunflowers that there would not be enough bees to pollinate them but this fear proved to be groundless. But the rains failed and the sunflower crop with it, bringing the whole program to an end.


The Groundnut Affair by ALAN WOOD

HOME PAGE OF Thayer Watkins