Introduction 

Tanzania is a very vast country with a total area of 945,000 kms² and a population of 35 million people. It is the largest nation in the East Africa both in land area and population.

The United Republic of Tanzania, which includes the Islands of Zanzibar and Pemba, lies on the east coast of Africa. It has a common border with eight countries: Kenya and Uganda to the north; Rwanda, Burundi and the DR Congo to the west; and, Zambia, Malawi and Mozambique to the south. The multi-border characteristic of Tanzania reinforces its accessibility, giving it competitive leverage over neighbouring countries, which possess less exposed boundaries.

Tanzania boasts the highest mountain in Africa, Mount Kilimanjaro (5,895m), a highland plateau, several inland water ports on three Great Lakes and a coastline of 800 kilometres bordering the Indian Ocean. The climate of the coastal plain is tropical with average rainfall between 500 mm and 1000 mm; elsewhere the climate is moderately tropical, with average temperature of around 26ºC and with annual rainfall varying from 500mm to 1250mm.

The Economy - Tanzania started liberalising its economy, moving from a centrally planned economy to a private sector led economy, in the mid 1980s offering excellent opportunities for much free trade and for foreign investors. The Tanzania Government has taken several concrete steps and provided several incentives to encourage foreign investment. Attractive foreign direct investment policies have led to a considerable improvement in the economic position.

Tanzania is endowed with abundant natural resources, mineral wealth, large natural gas reserves, rich agricultural sector and good prospects for petroleum. Tanzania enjoys a strategic location on the east coast of Africa, which has inherited a natural hub and choice for trade and investment. Dar es Salaam port and Tanzania railways provide the gateway to the landlocked rich hinterland comprising of its six neighbouring countries. Tanzania also has three big ports in the east coast, i.e. Zanzibar, Tanga and Mtwara.


Investment Climate 

Tanzania offers tremendous opportunities for investors as it is endowed with abundance of natural resources such as arable land, a wide base for raw material supply from local source, political stability, good market policy (privatisation, investment incentive, liberalised foreign exchange control and the ongoing establishment of socially responsible economy) excellent geographical location in the East African Region and truly wonderful tourist attractions.

Tanzania Government is continuing with the agenda of structural reform and economic liberalisation for generating greater economic growth. The key investment sectors are agriculture and livestock, leather, mining, tourism infrastructure, information technology, insurance and human resources development. In agriculture and livestock sector, Tanzania has large quantities of water for irrigation from lakes and rivers and suitable climatic conditions for all crops including spices, horticulture, oilseeds, etc. Opportunities exist in: large-scale farming; leather industry; agro processing; fishing projects in the Indian Ocean and in the Great Lakes like Victoria, Nyasa and Tanganyika (where potential yield of fish from natural waters is estimated to be 730,000 metric tons annually and present catch is 350,000 metric tones); textiles and garment production; and, ginning and yarning units. Petroleum and mining sector is another investment opportunity in Tanzania. Tanzania has a substantial reserve of diamonds, gold, gemstones like rubies and Tanzanite, etc.

Tourism is Tanzania's first economic sector. The main tourists attractions are the wild life parks in Tanzania like the Kilimanjaro, which is the highest mountain in Africa, Serengeti National Park which is the largest park in the world, exotic islands of Zanzibar etc. Investment opportunities in tourism include investment in hotels and lodges and general hospitality and related services. Other primary sectors for investments include IT and human resource development, manufacturing, transport especially in the inland marine, and tourist trade - because of the six land lock neighbouring countries.

Why Invest in Tanzania - Tanzania has enjoyed peace and stability since independence. It has a multiparty system with an elected President. The Presidential term is limited to two terms only. Tanzania is also comparatively free of ideological factions. Several measures have been introduced by the Government such as introduction of structural reforms in 1996, streamlining of the core services, enhancement of privatisation of parastatals, improvement of the investment climate and strengthening of the Private Sector as a new engine for growth plus good Governance to make Tanzania an attractive investment destination.

Labour Cost and Availability -Access to low cost labour is a key priority for companies competing in Africa. Tanzania offers trainable skilled labour at significantly low labour costs. The Government has made a long-term commitment to develop a pool of well-trained and educated specialists.

Transfer of Capital - Regulations permit unconditional transferability through any authorised bank in freely convertible currency of net profits, repayment of foreign loans, royalties, fees, charges in respect of foreign technology, remittance of proceeds and payment of emoluments and other benefits to foreign employees working in Tanzania.

Local Credit Availability - Any foreign business operating in Tanzania may obtain credit from domestic financial institutions up to the limits established by the Bank of Tanzania. There are a many Licensed Banks and Non-Bank Financial Institutions in Tanzania.

Transfer of Technology - There are no restrictions in enterprises entering into technology transfers. But every Agreement for transfer of technology must be registered with the Tanzania investment.


Tanzania – India Relations

Economic relations between Tanzania and India go back many centuries and the economic reform programme launched by both countries in the past few years contributed to an exponential increase in trade in the 1990s. The last few years have been characterised by rapid growth of economic and commercial relations. The bilateral trade between the two countries in the last 15 years has risen nearly 30 times from a meagre US$60.4 million in 1985-86 to nearly US $190.6 million in 1999-2000. India is the largest trading partner of Tanzania. According to Tanzania's trade figures for the year 2000, India has 8.62 percent share of two-way trade and ranks as the second largest trading partner of Tanzania after the United Kingdom.

Several bilateral and multilateral agreements between Tanzania and India have been signed over the years. India and Tanzania have formed Indo-Tanzania Joint Commission. The Joint Commission has held numerous sessions since 1975 and has helped in strengthening and deepening economic relations. Several Agreements and Memoranda of Understanding have been signed covering various fields such as education, health, agriculture, information technology, industries and trade, investments, finance etc.

Tanzania and India economic relations are of special significance. India and Tanzania are closely linked through diverse geographical, historical, cultural, political, economic, commercial and other ties. There is great scope for further strengthening these ties and increasing the level of bilateral co-operation between Tanzania and India. With the visit of Tanzania President H.E. Mr. Benjamin W. Mkapa to India which took place in December 2002 and the recently held sixth session of the Indo-Tanzania Joint Commission on Scientific, Technical and Economic Co-operation in Dar-es-Salaam, Indo Tanzania Co-operation in the future appears brighter.


Tanzania Country Data