For eighteen years Tanzania adopted the Arusha Declaration as the economic development policy, a mode/that sought to develop the country along a socialist path. In response to a serious economic crisis that caused enormous suffering for the local population, due to the scarcity of consumer goods, balance of payment problems and the debt crisis e.r:perienced in the 1980's, socialism was quitely abandoned The purpose of this paper is to query whether the rush to implement capitalism may have similar negative consequences?