Executive Summary
Tanzania achieved lower-middle-income status in 2020 with a per-capita GDP of approximately $1,200–$1,300. GDP growth has remained resilient at 5.3–5.7 % during 2023–2024 and is projected to reach 6.0–6.3 % by 2025, propelled by agriculture (26 % of GDP), industry (33 %), and a rapidly expanding services sector (41 %).
Critical vulnerabilities include extreme export concentration (gold dominates, with copper emerging), climate exposure affecting agriculture-dependent livelihoods, a narrow tax base (13.1 % of GDP vs. the peer average of 18–20 %), and significant infrastructure deficits (46 % electricity access, 29 % internet penetration).
This study presents five strategic pillars aligned with Vision 2050 and supported by IMF arrangements and the World Bank Country Partnership Framework (FY2025-2029). Implementation targets include manufacturing growth from 8 % to 15 % of GDP by 2030, poverty reduction to 20 % nationally, tax revenue reaching 18 % of GDP by 2035, and electricity access expanding to 75 %.
Current Economic Performance & Structural Composition
Tanzania's macroeconomic stability is reflected in controlled inflation (3.1–3.8 %), manageable fiscal deficits (2.5–3.5 % of GDP), and sustainable debt levels (46 % of GDP). The economy rebounded strongly from COVID-19 disruptions, with growth accelerating from 4.9 % in 2022 to 5.3 % in 2023 and an estimated 5.5–5.7 % in 2024. Tourism surged 18.2–20 % as international arrivals recovered, while the mining sector grew 8.5–8.6 %, driven by gold output and emerging copper development.
Table 1.1 – Comprehensive Macroeconomic Indicators (2023–2026)
| Indicator | 2023 | 2024 | 2025 (Proj) | 2026 (Proj) |
|---|---|---|---|---|
| Real GDP Growth (%) | 5.3 | 5.5–5.7 | 6.0–6.3 | 6.3–6.5 |
| Nominal GDP (USD billion) | ~80 | ~85–87 | ~93 | ~100 |
| GDP per Capita (USD) | ~1,200 | ~1,227–1,300 | ~1,303 | ~1,380 |
| Inflation (CPI, %) | 3.8 | 3.1–3.3 | 3.4–4.0 | 4.0 |
| Fiscal Deficit (% of GDP) | 3.5 | 3.0–3.4 | 2.5–3.0 | 2.5 |
| Public Debt (% of GDP) | 45.5 | 46.3–46.7 | ~46 | ~48 |
| Current Account Deficit (% GDP) | 3.8 | 2.6–4.0 | 4.2 | 4.2 |
| Reserves (months of imports) | 4.5 | 4.4–4.5 | ~4.5 | 4.5–5.0 |
| Tax Revenue (% of GDP) | 12.5 | 13.1 | 13.5 | 14.0 |
| Unemployment Rate (%) | 9.3 | ~9.0 | 8.5 | 8.0 |
Sources: AfDB, World Bank, IMF, Tanzania Ministry of Finance, National Bureau of Statistics (2024–2025)
GDP Growth Rate Trend (2023–2026)
Year-on-year real GDP growth trajectory showing accelerating economic momentum.
Key Macroeconomic Trends (2023–2026)
Comparative trend lines for inflation, fiscal deficit, unemployment and tax revenue.
Table 1.2 – Sectoral GDP Composition & Growth Dynamics (2024)
| Sector | % of GDP | Growth Rate | Key Drivers |
|---|---|---|---|
| Agriculture | 26.3 % | 4.3–5.6 % | Favorable weather, grains, coffee |
| Mining & Quarrying | 10.1 % | 8.5–8.6 % | Gold exports, emerging copper |
| Manufacturing | ~8.0 % | 5.0–5.8 % | Agro-processing, construction inputs |
| Construction | 6.8 % | 7.2 % | Infrastructure projects |
| Trade & Repairs | 8.6 % | 5.1 % | Domestic commerce expansion |
| Transport & Storage | 7.9 % | 6.2–6.3 % | SGR, port activity |
| Tourism & Hospitality | ~4.5 % | 18.2–20 % | Post-COVID recovery surge |
| Financial Services | 3.4 % | 8.9 % | Digital finance growth |
| Electricity & ICT | ~10 % | 14.3–27.8 % | Julius Nyerere Dam, connectivity |
| Other Services | ~13 % | 5–6 % | Public admin, health, education |
Sources: National Bureau of Statistics, AfDB, World Bank (2024)
Sectoral GDP Composition (2024)
Share of total GDP by sector — Agriculture remains the largest single contributor.
Sectoral Growth Rates (2024)
Horizontal bar chart — Tourism & Electricity/ICT lead growth across all sectors.
Critical Observations
Agriculture employs 65 % of the workforce yet contributes only 26 % of GDP, indicating persistently low productivity. Manufacturing has stagnated at ~8 % of GDP since the mid-1990s despite policy efforts. The informal sector contributes an estimated 46 % of GDP while employing 76 % of the labour force, creating a major tax-base challenge.
The poverty-growth paradox is stark: despite 5–6 % GDP growth, poverty reduction has been slow — 26–28 % nationally and 49 % at the $3/day international standard. Non-performing loans have declined to 4.3 % (from 5.7 %), but access to finance remains constrained, especially for smallholders and MSMEs.