Tanzania has always run on a wider and richer path of reliable business partners, and the United Arab Emirates (UAE) is one of them. The two countries have been engaging in a number of diplomatic and economic operations since 1974, and they have built a healthy partnership.
With the new administration led by President Samia Suluhu, which is strictly focused on opening and building strategic partnerships with other countries, the UAE and Tanzania could foster more tangible business relations, from the extractives sector to tourism and hospitality.
The new administration is now streamlining deliberate efforts to promote tourism and industrial development to create more jobs and improve the national economy.
At the moment different top-tier investing parties have showcased their confidence in Tanzania, including Africa’s wealthiest man, Aliko Dangote, who plans to construct a fertilizer factory {The Citizen}.
The UAE holds nearly 10 million people and stands on a $421 GDP representing at least 0.37 per cent of the world economy, according to World Bank. On the other hand, Tanzania is yet standing as another relatable and arguably the most exotic tourist destination across East and Central Africa, with a low-middle-income economy, which is estimated at $62.41 billion in 2020, representing 0/06 per cent of the world economy (World Bank).
During the 2019 Tanzania Dubai Business Forum, both Tanzania and UAE pointed out tourism, manufacturing and real estate sectors as crucial angles for UAE investors to jump into.
In the forum, H.E. Al Ghurair, Chairman of Dubai Chamber of Commerce and Industry noted that “Dubai is an ideal partner for Tanzania given the Emirate’s strategic position as a re-export with strong links to the GCC, Middle East and Asia”.
Dubai accounts for a majority of the UAE’s trade with Tanzania, and revealed that Dubai-Tanzania non-oil trade has grown steadily to reach $1.8 billion in 2017, adding that more than 200 Tanzanian companies are registered with Dubai Chamber, according to the Embassy of the United Arab Emirates in Dar-es-Salaam.
Both countries hold valuable contributions to the global economy and so far, there are plenty of business opportunities that have a plethora of benefits for both. Dubai is widely known for its gigantic modern wave of tailored shopping, adventure and entertainment tourism, and the sixth and seventh-largest natural gas and oil reservoir in the world.
Further, Dubai Chamber’s Chairman noted that the forum is a catalyst that provides an opportunity to strengthen trade and investment ties between the UAE and Tanzania, and “reaffirmed the Chamber’s commitment to providing all necessary support to ensure that bilateral relations continue to develop and flourish in the future”.
Tanzania as a determined developing nation has several things to offer UAE, within the manufacturing, real estate and tourism sectors. It has been 19 years since Tanzania opened its embassy doors in Abu Dhabi and 14 years ago the UAE opened its embassy in Tanzania’s commercial capital, Dar es Salaam.
READ:Dubai-based firm Al Nakhil to invest in Zanzibar tourism
UAE and Tanzania investment trend
Banking on UAE and Tanzania investment could be the next angle that might yield billions, as the trade balance between the two countries stands at more than $2 billion annually.
According to Reem Al Hashimy, UAE Minister of State for International Cooperation and director-general of Dubai Expo 2020, there are a significant number of companies that have already proactively explored Tanzania’s investment environment in oil and gas exploration, mining, hospitality, agriculture, tourism and other industries.
According to Dubai Exporters, UAE is one of Tanzania’s top five import partners led by China representing 12 per cent of total imports, followed by Switzerland (8.8 per cent), South Africa (8.5 per cent), UAE (8.4 per cent), and India (7.6 per cent).
In terms of numbers, the relationship between the two countries has been doing well. Direct accumulative investment by the UAE in Tanzania rose to $991.5 million. Tanzania on average imports $1.14 billion worth of goods from the UAE with 53 per cent of that being petroleum products while the UAE imported $85 million worth of goods from Tanzania, comprising mainly of agriculture products {Dubai Exporters}.
Also, another important aspect to note is that exports from Tanzania to UAE recorded $84.6 million representing 62.9 per cent of the total sent to GCC up from $15.5 million representing 41.16 per cent of the total sent to GCC according to independent economic studies.
Down the line, Dubai Exporters find Tanzania’s foreign direct investment (FDIs) especially in the petroleum and gas sector strong as several foreign establishments are focusing their attention towards the country that has become a viable investment destination.
Dodsal, a Dubai based multinational conglomerate focused on exploration and production of oil and gas, has already seeded its investment in Tanzania’s oil and gas industry. The company signed a Production Sharing Agreement (PSA) in 2007 with the Tanzanian government for the exploration and production of hydrocarbons for the RUVU block.
READ:FlyDubai launch free flying flights from Tanzania
Dodsal has also been successful in marking Tanzania’s oil and gas industry on a global scale, as in 2016 it announced it had discovered gas reserves worth an estimated $8 billion in the Ruvu basin (2.7 trillion cubic feet).
Dodsal also has secured a mining concession in Tanzania in a 100 square kilometre area.
“The steadily increasing trend of economic development of Tanzania in the next few years is already attracting a lot of attention, and the demand for state-of-the-art storage facilities at industry affordable costs for the wholesalers in the region is also being addressed,” Dubai Exporters noted.
Business branding platforms such as Dubai Expo are crucial for Tanzania and Dubai to maximize their reach. Tanzania stands to enhance its development object by streamlining its agenda towards other partners coming through Dubai, but also for Tanzanian investors to eye different business opportunities in Dubai.
Within the aviation sector, the two countries stand to draw billions as they both exhibit unique tourist attractions. UAE has its enormous hand in transport and it has invested in Tanzania.
“Various airlines operate from the UAE to Tanzania. The Airbus 330-200 freighter that can carry up to 64 tonnes is also used for weekly flights on the Abu Dhabi–Dar es Salaam–Nairobi route. Etihad Cargo is expecting in future to capitalize on the import and export demand of Tanzania by importing more manufactured items such as electronics, medical equipment and some food items to Tanzania,
UAE and Tanzania relations keep on proving to the world how constructive partnerships can breed a fifty-fifty win. In this case, the Tanzania government ought to improve and strategize its investment plans to cast a wider net of investors, to other avenues of the economy, especially agriculture which employs most of Tanzania’s labour.
READ:Africa-Dubai summit: Exploring the markets of opportunity
