Tanzania Business News

Tanzania Economic Summary- 2022/23
(Source: The World Bank / AfDB Group - African Economic Outlook (AEO))
Tanzania has sustained relatively high economic growth over the last decade, averaging 6-7% a year. The medium-term outlook is positive, with growth projected at 4.1% in 2022/23, supported by large infrastructure spending. The country's overall population is about 61.5 million (2021) has made it a vital market in the East African region. Tanzania's 2021 GDP was $67.8 billion, while its per capita income in 2021 was about $1,136. The Government has prioritized efforts to improve public administration, planned scale-up in infrastructure projects and manage public resources for improved socio-economic outcomes.

Reforms, particularly focused on fostering private investment and improving fiscal policy design and implementation, are vital priorities that are currently under Government consideration to achieve higher economic growth and create a more productive industrial environment. The broad policy objectives of the new government remain guided by the Tanzania Development Vision 2025 and its supporting five-year development plans.

Recent Economic Developments in Tanzania
Regional growth is on an upward trajectory in East Africa, though varying significantly by country. The Sub-Saharan Africa (SSA) region continues to maintain competitiveness in GDP growth when compared to the rest of Africa.

Economic activity in Tanzania is recovering, with the 2022 real GDP growth rate projected to reach 4-5% (2022 at 4.3%, up from 2% in 2020 due to covid). The accommodation and restaurants, mining, ICT, transport, and electricity sectors are driving the recovery. High-frequency indicators suggest that while economic activities were expanding, they have not yet reached pre-pandemic levels. Leading indicators such as cement production, electricity generation, private-sector credit, goods and services exports, nonfuel goods imports, telecommunications, and tourist arrivals have continued to increase (June 2022), though activity in most sectors remains below pre-pandemic levels. Driven by higher energy and food prices, inflation has increased but remains manageable at 4.5% (July 2022).

As in mainland Tanzania, official data for Zanzibar shows that economic activity is recovering. Real GDP grew by 5.1% in 2021, following significant slowdown to 1.3% in 2020 due to the impact of the COVID-19 pandemic on the tourism-dominated services sector which accounts for nearly 50% of Zanzibar's GDP.

Import Export Summary
Although tighter global financing conditions are weighing on Tanzania's economy, Oil imports account for about a quarter of the total value of the country's imports while mineral exports, especially gold, and agricultural raw materials account for nearly a third of the total value of its exports.

Macroeconomic Outlook
Key opportunities include peace and political stability, abundant natural resources, a strategic geographic location, and immense development potential for tourism. The Export Zone Processing Agency established in 2008 to accelerate manufacturing exports and help the country achieve structural transformation has helped attract close to $1 billion in foreign direct investment and revive the manufacturing sector into one of the fastest growing in Africa.

GDP Growth
Tanzania's annual GDP growth rate averaged 7% over the past 10 years, making it one of the 20 fastest growing economies in the world and beating the Sub-Saharan Africa average GDP growth rate of 4.4% during the same period.

GDP Growth
Tanzania's annual GDP growth rate averaged 7% over the past 5 years, making it one of the 20 fastest growing economies in the world and beating the Sub-Saharan Africa average GDP growth rate of 4.4% during the same period.

Specifically, the average GDP growth forecast for Tanzania is supported by:

• Improvement and stability in power supply mainly from natural gas, which is expected to boost performance of other sectors including manufacturing and trade.
• Revival of the central railway line in standard gauge.
• Increase in the capacity and efficiency of the Dar es Salaam and Tanga Ports.
• Increase in financial deepening.
• Implementation of economic policies under the Five Year Development Plans
• Scaling-up of onshore gas production and construction of oil pipeline from Uganda to Tanzania.

Current GDP Growth

12 Gigantic Projects That Are Rapidly Transforming Tanzania.