The Tanzania Investment Centre (TIC) said that the country garnered a 22.2 percent rise in registered projects over the past five months. 132 additional projects will be registered between July and November of 2022, compared to 102 during the same period in 2021.
Tanzania is making significant progress in attracting the appropriate investment over time and space. This development is attributable to the current government under the leadership of President Samia Suluhu Hassan, whose dedication to expanding investment is shared by the whole economy.
Tanzania’s economy is currently at 5,2 percent of GDP (3rd quarter 2022) and 4.9 percent inflation. Notwithstanding this, growth in other vital areas has been crucial to ensure Tanzania’s industrialization goals remain on track.
According to a research published by African Mining Market on February 13, the mining industry in East Africa is witnessing tremendous expansion. Whereby, Tanzania’s sector is adding to the GDP whose proportion grows annually.
The contribution of the mineral sector to the GDP climbed to 7.2 percent in 2020/2021, up from 6.7 percent in 2019/2020. The expansion is a result of the sector’s 2017 initiation of a substantial institutional and economic reform.
Inheriting the baton from the previous administration, Her Excellency President Samia envisions the sector contributing at least 10 percent of the GDP by 2015.
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Tanzania expects to gain across the sector as a result of the extensive engagement between multinational corporations mobilizing capital and other resources to drive Tanzania’s industrialisation goals.
Many sectors, including transportation, manufacturing, tourism, agriculture, services, commercial construction, and finance, have seen a rise in investment over the past year, as reported by the TIC.
The data indicate that Tanzania’s investments have a promising future.
“The value of the projects has reached 3.16 Billion USD and the projects are expected to create 21,297 jobs in comparison to only 881 Million USD last year which created about 13,578 jobs. There is and increase of over 250 percent in terms of the value of the projects and over 57 percent projected jobs an increase as a result of the proportion increase in the registered projects” TIC Acting Executive Director, Mr John Mathew Mnali said during a press conference in December 2022.
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Tanzania’s natural resources and current trajectory prevent it from being the most competitive and varied economy in the East African Community (EAC) bloc and the broader region, while being one of the fastest-growing economies in Africa.
In the past year, Tanzania has rebuilt and revitalized some of the economy’s most vital lifelines, including foreign direct investment and economic diplomacy links with the developed west — a major ally in the global marketplace.
While Tanzania taking lead in strengthening its investment arena, yet, some promising sectors are needing enough institutions and upgrades to be investigated, such as agriculture, and renewable energy to mention a few.
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Tanzania: Tapping the Cocauntapped economic potential
In 2021 FDI in Tanzania climbed to over $1.1 billion, the most in East Africa. These data suggest more billions can be accessed from other attractive sectors.
In the same spirit, a Tanzania tycoon Mohamed Dewji brought out the same feelings towards investment in Tanzania during his interview with CNN earlier in February.
The business leader who was recently recognized as one of the region’s wealthiest individuals believes that Africa (Tanzania) have enormous potential but lacks strong and good policies to capitalize on the available potential and optimize profitable industries.
Dewji, whose economic empire spans the East African nation, expects expanding his farming businesses by investing an additional $200 million.
“Why are we still importing food while we have 40 percent of the arable land in the world and we have a young population? All we need is a little bit of technology and capital” the business tycoon told CNN during an interview.
Using agriculture as an example – which employs more than 60 percent of Tanzania’s workers and provides 80 percent of the country’s food – vast potential to bring profitable crops to the global market are not exploited.
For the preceding two years, Tanzania bought the majority of its palm oil ($302 million) and wheat ($219 million) from China.
It is surprising that a prospective food exporter with adequate arable land still imports food. The Organization for Economic Cooperation and Development (OECD) believes Tanzania’s agriculture to be still striving to disengage from its infancy stage.
Meanwhile, commercial ventures are found largely in traditional export crops such as coffee, tea, cotton, cashews, tobacco and on a smaller scale, cloves and sisal.
In that context, Tanzania is attempting to meet the potential in the middle by upgrading its agro-processing environment. According to the agriculture ministry, there is an increase in the number of sugar, edible oil, cotton, and grain processing facilities across the country.
On the other hand, the Tanzanian government is working hard to elevate its industrial sector. The TIC and Export Processing Zone Authority (EPZA) is planning to construct at least 500 big industries by 2025.
Investing in technologies and in human resources to invent transformative products and tools is a vital aim for the Tanzanian private sector, stakeholders and government to engage towards.
In recent years, the cashew industry has not showed significant value addition, particularly in terms of improving product quality and increasing output for the developing ready-made market.
Competing markets such as Vietnam and India are currently in the same road with Tanzania for global cashew markets despite the ready-market set for Tanzania. Regardless of the latter, Tanzania’s performance in the category is poor. In contrast, it acts as a call for Tanzania to realize its present export potentials by increasing both the quality and quantity of its exports.
There are also underlying potential in the textile business, which supposedly is being resuscitated slowly by investors and creating a boom like it used to be in 1970s and 1980s. In addition to the 17 traditional growing zones, the crop is currently grown in additional areas (central and coastal regions).
Hence, the latter enables the nation to realize its potential in terms of processing facilities for cotton products, such as yarn, which command substantial outside markets (China, US and Europe).
On a global scale, Tanzania is establishing the appropriate political and economic environment for international trade and investment. President Samia’s worldwide trips to the United States, China, and Europe, as well as her participation in global gatherings such as the Davos World Economic Forum Annual Meeting, send investors strong signals that Tanzania is open for business.
