The draft budget for FY 2017/18, tabled on June 9, 2017 by the Ministry of Finance and Planning (MoFP), aims to raise real GDP growth to 7.1% in 2017, up from 7% the previous year, while shrinking the budget deficit from 4.5% to 3.8% of GDP, and keeping inflation between 5% and 8%. A country of 53m, Tanzania remains one of the strongest economies in the EAC, with the IMF forecasting GDP growth…
The regulatory framework for the energy sector in Tanzania is evolving rapidly. However, the sheer volume of changes has left many investors struggling to ensure compliance, and recent laws and regulations create potential conflicts with previously struck production-sharing agreements (PSAs). In addition to the Petroleum Law of 2015, which overhauled various upstream and midstream segments,…
The government of Tanzania hopes to encourage industrialisation and investment in labour-intensive manufacturing through its export processing zone (EPZ) and special economic zone (SEZ) schemes, which were launched in 2002 and 2006, respectively. Managed by the Export Processing Zones Authority (EPZA), the EPZ scheme promotes investment in export-oriented manufacturing activities, while the…
While some hotels in Tanzania have been affected by taxes on tourism activities and slowing foreign investment in 2017, the outlook for growth is nonetheless promising. Rising visitor numbers and the diversification of the tourism sector are encouraging major chains to move into the country with a view to the long term. Demand Growth Hotel occupancy and average daily rates (ADR) are set to…
While many countries have overlooked vocational education to focus on schools and universities, Tanzania has had a thriving vocational segment for decades. Indeed, it has proved more responsive to the needs of an evolving society and a growing market than much of the education sector, and has taken a lead in involving foreign and private sector partners, a model that is likely to be expanded…
As many nations in sub-Saharan Africa rely largely on tax revenues to fund spending, governments have been known to be displeased with businesses that delay recouping investments and consequently graduate into the income taxpayers’ group. However, imposing income tax on businesses yet to recoup their initial investment would deter investors. The Income Tax Act, 2004 allows businesses to recoup…
In a bid to bolster slowing agricultural exports and support industry growth, the government of Tanzania moved to eliminate the majority of levies applied to the agriculture sector in its 2017/18 budget. These levies have led to inflated input costs, and high levels of value-added tax (VAT) and tariffs on inputs have disproportionately affected smallholder farmers. Eliminating levies should…
Smallholder farmers account for the large majority of agricultural output in Tanzania, making their integration into larger value chains a vital component of the sector’s growth agenda. At present, smallholder growth remains constrained by severe infrastructure deficits that limit access to domestic and international markets, challenges in obtaining and utilising high-yielding inputs such…
The United Republic of Tanzania comprises two separate, semi-autonomous regions: mainland Tanzania (formerly Tanganyika) and Zanzibar, an archipelago of islands with its own executive, legislative and judicial branches. Certain areas of law are union matters, meaning the same law applies to both lands, while for non-union matters – such as corporate or land law – Zanzibar’s legislature…
As it looks to develop its first new National Tourism Policy in 18 years, the Tanzanian government is likely to have a number of priorities in mind, including boosting visitor numbers, enhancing market and geographical diversification, and improving standards to ensure that the country retains its status as a high-end destination. The new policy can draw on both the government’s overarching…
