What business opportunities in Tanzania can a foreigner consider to invest in?

Tanzania is a great place for foreign investors. Many foreign businesses have been operating here for years, so there are many possibilities for investment. But what business opportunities in Tanzania can a foreigner consider? Here is a list of sectors that could be attractive to the wider global community.

Agriculture: The agriculture sector accounts for about 48 percent of Tanzania’s GDP, provides 65 percent of total export earnings, and is by far the largest employer. Opportunities in the sector exist in technology investment in the areas of farm implements, agro-processing industries, agricultural machinery, irrigation equipment, fishing equipment, agricultural inputs as well as general commodity trading.

Information Technology: The IT sector has been the fastest-growing sector in Tanzania for the past 10 years. The increasing number of Internet cafes in urban centers offers a big opportunity for computers, especially refurbished ones that are available in abundance in developed countries. In addition, most middle-level managers and small businesses are taking advantage of the lower prices and are now computerizing offices and providing computer training in schools. This is potentially a big market for IT companies.

Environment and Energy: The opportunities available for the environment and energy sector are in the areas of (i) petroleum-Tanzania Petroleum Development Corporation in collaboration with international companies, Dublin International, CANOP (T) Ltd, and Ndovu Resources continue to research and explore in southern regions and along the coastal line (ii) solar – Global Environment Facility (GEF) sponsored data collection for preparation of solar development program. Negotiations are in progress to reduce duties on solar equipment; (iii) natural gas – negotiations are ongoing on how to utilize natural gas found in deposits in the south coastal areas; (iv) wind: research on establishing the speed of wind has been completed and potential areas are identified for wind energy and (v) geothermal on which research is ongoing and a private company, First Energy in collaboration with investors is working on

Health: The Health sector is faced with many challenges, especially with the advent of HIV disease and the immunity of chloroquine medicine to malaria. Sales opportunities available in the health sector are in hospital equipment, research and production facilities, drugs and pharmaceuticals, preventive facilities e.g., condoms, mosquito nets, etc

Construction: The biggest opportunity available for the construction industry is in the facilitation of the importation of construction equipment for hire to small contractors. Small road contractors in Tanzania would benefit from the facility since they are unable to invest in equipment of their own.

Consumer Goods: Local industry accounts for some 15 percent of consumer goods used in Tanzania. It is mainly limited to the processing of agricultural products and light consumer goods.  With a population of about 35 million, the slow pace of industrialization coupled with the adoption of regional integration in East and sub-Saharan Africa, Tanzania’s dependence on imported consumer goods is likely to remain for the coming 20 years or so. However, a recent government effort in facilitating Export Processing Zones is expected to revamp the agro-processing and increase agricultural goods for export and the internal market. EAHP seeks to increase access to finance and improve management skills in the small and medium size sectors. It is expected that after the provisioning of such services, small manufacturing enterprises will be able to contribute to the economy by increasing the supply of goods.

Financial Services: The opportunities available for the sector are mainly linked to sound investors as well as providing services to the growing number of community banks that require technology for the efficient delivery of services. The biggest constraint to the growth of commercial banks is savings mobilization as most banks are not yet able to serve the rural market. At present, the commercial banks’ network is limited to urban and peri-urban areas only. The lack of a development bank has been the biggest setback to financial institutions’ contribution to the growth of the economy as some sectors, e.g., agriculture, manufacturing, real estate, etc., require long-term loans that are not provided by commercial banks.

Mining: Though agriculture is the backbone of the economy, at present, mining is the engine of economic growth. The sector had a growth rate of 14% in 2000 compared with 9% in the previous year. The opportunity for mining is in finding investors, especially in locations e.g., Muheza and Chunya with gold deposits that lack a serious investor or venture partner who can collaborate with artisanal miners. As for small miners, the opportunity is on market linkage to international buyers as well as assistance in sourcing hand tools and small equipment such as water pumps, generators, compressors, etc.

Textiles: Tanzania produces raw cotton and textiles. Cotton is the fifth largest agricultural export commodity contributing 3% of total exports in 2000 after coffee (15%), raw cashew nut (9%), tobacco (7%), and tea (6%). However, the textile industry which was vibrant in the 1970s has lagged behind after market liberalization. The opportunities available in the textile sector are related to the AGOA and the capitalization process that will be undertaken by the private owners. The latter is envisaged to result in demand for linkage to suppliers of technology.

Tourism: Tourism is Tanzania’s second largest foreign exchange earner with over US$ 1.3 billion in revenues and almost a million visitors annually. The country offers 12 national parks and 15 game reserves, providing a habitat for a wide range of flora and fauna. Opportunities available in the tourism sector are agency services, camping equipment, vehicles, hotel equipment, diving equipment, tourist boats, mountain climbing equipment as well as tour promotion services e.g., web designing.

Transportation: The sector brings a big potential for foreign investment, especially in the area of inland cargo transportation equipment for road services and marine transportation in both inland and coastal waterways. Other available opportunities are in passenger transportation equipment, small and medium air transportation equipment as well as traffic monitoring equipment.

As a whole, Tanzania is definitely worth looking into if you’re a foreign business owner who’s interested in expanding their operations outside of other African nations. Don’t miss the first-ever East African Business Expo happening this March 23rd to 26th March at Kololo Independence grounds, Kampala Uganda. Use this chance to find out more about doing business in the seven East African countries. Register here: https://eabexpo.com/attend/