Tanzania continues to outperform its neighbouring countries, according to PwC. Why? Because its geographical location makes it both a gateway to East Africa and the Eastern Hemisphere.
All the answers to your unique business lifestage questions
With the expansion of the port at Bagomoyo, Tanzania is set to have the highest export capacity in Eastern Africa. “In terms of rating it as an investment haven, I would say it has potential and I haven’t been exposed to any corruption. There are large areas that are relatively unexplored and therefore a good investment attraction,” Dick Kruger, deputy head of techno economics at the Chamber of Mines.
Although Tanzania remains relatively unexplored, and still has a lot of infrastructure projects to finish to meet industry standards, it’s making a case for itself as a solid investment. Anyone wanting to export to East Africa, or even businesses wanting to establish a base and export internationally to and from the East, should look at branching into Tanzania.
Related: Is Tanzania the way forward?
Tanzania has realised that its Port of Dar es Salaam is a major bottleneck, which limits the country’s ability to trade – not only from a capacity perspective, but also in terms of clearing shipments through customs, according to PwC. This is why the port at Bagomoyo is being built, to increase capacity.
Here are a few reasons why you should look to Tanzania when exporting to or from East Africa:
Continued investment in infrastructure
There is a continued investment in infrastructure, which should drive demand for credit and has a positive impact on employment. Specifically, the ports industry in Tanzania is a key driver of growth, along with ongoing efforts to improve services and expand capacity. In late 2015 construction began of a USD11 billion port and associated industrial zone in Bagamoyo, which will be a catalyst for investment in the region, according to a report by Deloitte entitled: Tanzania Economic Outlook 2016: The Story Behind the Numbers.
Here is a breakdown of various sectors offering opportunities, according to the Deloitte report:
Media, telecommunications and technology
The technological market continues to grow from strength to strength as the government continues to implement support and innovative strategies and programmes to increase usage and increase coverage. According to BMI, the mobile market has grown over the last few years, increasing by 22.4% year-on-year, to reach 39 million subscribers in 2015. This means that year-on-year your customer base will be growing along with the mobile market, if you can expand into the country before another serious competitor.
Transport and infrastructure
The Tanzanian government recognises the importance of road infrastructure for the growing economy and increase in foreign direct investments. In 2015, the African Development Bank approved a loan worth USD 364.4 million for the Transport Sector Support Programme. This involves the rehabilitation and upgrade of around 500 km of roads. This will make it easier for industries to transport their goods and promote the transport and logistics going into and out of the country.
Related: Tanzania’s top 3 investment opportunities that you can take advantage of
Increase in available, reliable power
Once again the Tanzanian government has recognised the importance of infrastructure, this time for the country’s power supply. In 2016/17, 1.13 trillion Tanzanian Shillings are in the budget to ensure availability of reliable power supply for industrial and domestic uses. This will promote industry and foreign investment in the country as more businesses move into the country and rely on the electricity grid.
- Invest in exporting to Tanzania and through it to East Africa or invest in exporting from Tanzania to the rest of the Eastern Hemisphere.
- Assist the government with building infrastructure, as well as improving and implementing technological advances.