The National Bureau of Statistics report on Tanzania's Industrial Production Index (IIP) for Q2 2024 reveals a promising increase of 6% in overall industrial production from Q1 to Q2, moving the index from 98.9 to 104.9. This growth is largely driven by a 7.6% rise in the manufacturing sector, with notable production surges in tobacco products (up 56.9%), rubber and plastics (up 27.8%), and pharmaceuticals (up 10.2%). Compared to Q2 2023, the IIP shows a modest year-over-year increase of 0.4%, indicating long-term stability with mixed results across sectors. While water supply and waste management saw a 4.8% increase, declines in mining (-2.1%) and electricity supply (-2.5%) highlight areas that may need strategic support to sustain Tanzania’s industrial growth.

1. Overall Industrial Production Index:
   • The overall IIP rose from 98.9 in Q1 2024 to 104.9 in Q2 2024, a 6% increase.
   • Compared to Q2 2023 (104.5), there was a modest year-over-year increase of 0.4%.
2. Sectoral Performance:
   • Manufacturing: Increased by 7.6% from Q1 to Q2 2024. Within this sector, notable increases included:
     • Tobacco products: 56.9% increase
     • Rubber and plastics: 27.8% increase
     • Pharmaceuticals: 10.2% increase
     • Motor vehicles: 9.4% increase
   • Mining and Quarrying: Increased by 5.0% from Q1 to Q2 2024.
   • Electricity, Gas, Steam, and Air Conditioning: Increased by 1.4%.
   • Water Supply and Waste Management: Increased by 1.6%.
3. Declines in Specific Manufacturing Areas:
   • Manufacture of electrical equipment dropped by 15.0%.
   • Printing and reproduction of media decreased by 8.2%.
   • Manufacture of wood products decreased by 7.8%.
4. Long-term Trends (Comparing Q2 2023 to Q2 2024):
   • Water supply and waste management showed a 4.8% increase.
   • Manufacturing showed a 2.1% increase.
   • In contrast, electricity, gas, and steam supply decreased by 2.5%, and mining and quarrying declined by 2.1%.

Tanzania's Index of Industrial Production (IIP) for Q2 2024 provides a valuable snapshot of the country’s industrial performance, highlighting areas of growth and decline.

1. Overall Industrial Growth:
   • The 6% increase from Q1 to Q2 2024 signals positive growth and resilience in Tanzania's industrial sector, suggesting that industrial activities are rebounding or accelerating post-pandemic and amidst global challenges.
   • However, the modest year-over-year growth of 0.4% from Q2 2023 indicates that while there’s short-term improvement, longer-term growth has been slower, which could reflect challenges or fluctuations in industrial output over the past year.
2. Manufacturing as a Key Growth Driver:
   • Manufacturing recorded the highest growth (7.6% from Q1 to Q2 2024), pointing to this sector as a leading driver of industrial expansion. Significant increases in specific manufacturing areas (e.g., tobacco, rubber, and pharmaceuticals) may reflect both increased domestic demand and potential export opportunities.
   • High growth in pharmaceuticals and plastics could also indicate shifts in production focus, possibly due to changes in health sector demands and consumer goods preferences.
3. Mixed Performance Across Sub-sectors:
   • Some areas, like water supply and waste management, showed steady growth, while mining and electricity saw minor increases. These improvements reflect stability in essential service sectors, which are less volatile and respond to consistent demand.
   • However, declines in areas like electrical equipment and printing signal potential issues, such as reduced demand or production challenges in those areas, possibly influenced by shifts in technology or reduced investment.
4. Long-term Stability with Caution:
   • The comparison of Q2 2024 to Q2 2023 shows that while some manufacturing activities are growing, sectors like electricity, mining, and certain manufacturing sub-sectors (e.g., electrical equipment) are experiencing declines. This suggests potential structural challenges, like limited investment in infrastructure or energy, which might need policy attention for sustainable growth.

Hence, this research reveals a robust industrial recovery in the short term, driven by manufacturing, but also shows areas of concern in specific sub-sectors. It signals that targeted policies could help stabilize and grow underperforming areas, ensuring a more balanced industrial expansion for Tanzania.