How to cite this paper: Fathma A .Fakih, Emmanuel J. Munishi & Ibrahim M. Issa (2021), Paper Title: Factors Constraining Leadership capacity in Resolving Conflicts at the Zanzibar State Trading Corporation (ZSTC). Business Education Journal (BEJ), Volume I, Issue II, 13 Pages. www.cbe.ac.tz/bej 1 Business Education Journal Volume I Issue II Email: jeditor@cbe.ac.tz Published Online January, 2021 in http://www.cbe.ac.tz/bej FACTORS CONSTRAINING LEADERSHIP CAPACITY IN RESOLVING CONFLICTS AT THE ZANZIBAR STATE TRADING CORPORATION (ZSTC) Fathma A .Fakih E-mail: Fatma19011@hotmail.com College of Business Education (CBE) P O BOX 1968 DSM, Emmanuel J. Munishi E-mail: e.munishi@cbe.ac.tz College of Business Education (CBE) P O BOX 1968, DSM & Ibrahim M. Issa E-mail: i.issa@cbe.ac.tz College of Business Education (CBE) P O BOX 1968 DSM ABSTRACT Despite the critical role of leadership in conflicts management in public organizations, alongside with the various initiatives undertaken to enhance this role, ineffective conflicts management continues to be a big challenge in public organisations and at the Zanzibar State Trading Corporation (ZSTC) in particular. Consequently, this study looks into the factors constraining leadership role in managing conflicts and recommends strategies for improving leaders’ capacity to conflicts management at ZSTC. Qualitative approach was adopted and data were drawn from a purposive sample of 65 respondents through in-depth interviews, documentary review, Focus Group Discussions (FGDs) and non- participant observation. Findings confirmed that constraints to leadership in managing conflicts were in four categories; notably lack of effective communication, ineffective leadership and management practices, inequitable distribution of resources, and nonexistence of conflicts management institutions. To ensure effective leaders’ role in managing conflicts, leaders need to have sound plans, adequate budget, engage in financial resources mobilisation and ensure recruitment of staff with relevant skills, as well as build capacities of the existing staff on communication and conflicts management skills. The organization should devise effective policies to smoothen conflict management. Keywords: Leadership, Conflict Management, Resolution, Public Institutions INTRODUCTION Background Information Conflict refers to a disagreement between parties or a situation whereby one party perceives another party as affecting its interests (Barmao, 2013). It is a situation in which two or more parties struggle to acquire the same scarce resources at the same time (Swanström & Weissmann, 2005). Accordingly, Burton (1990) differentiates between a dispute and conflict. The author notes that a dispute is a short-term disagreement that involves issues that are negotiable while a conflict, is a long-term disagreement with deeply rooted issues that are seen as “non-negotiable”. In this paper, the words conflict and dispute are used interchangeably to refer to the same thing. On the other hand, conflict management essentially refers to a process of preventing the negative aspects of conflict while increasing the positive aspects of conflict in a group or an organisation (Alper, Tjosvold & Law, 2000). It is aimed at enhancing learning and group outcomes, which may include but not limited to the effectiveness or performance of an organisation (Alper, Tjosvold&Law, 2000).