Full text can be accessed at the following link https://www.jstor.org/stable/24486553?seq=1#page_scan_tab_contentsParastatal organizations have been at the center of the debate on organizations in Tanzania. No doubt this is partly due to the important place they have assumed in the economy of the country since the Arusha Declaration of 1967 and the consequent nationalizations. The immediate reason for their projection into the lime-light however, has been their performance which has been far below expectations. Consequently, central to the debate have been the attempts to account for this disturbing performance in the hope of arresting the trend. Among the factors pointed out as possible causes of bad performance are two related issues: — the organizational form of these parastatals, and financial control in these organizations.