Tanzania

Tanzania has experienced relatively stable inflation rates over the past three years. In 2021, inflation was at 3.7%, a modest rate reflecting a stable economic environment. By 2022, inflation increased slightly to 4.4%, likely due to rising costs of goods and services. In 2023, inflation marginally decreased to 4.0%, showing a small but positive shift towards stabilization. Tanzania's inflation rate remains lower compared to several other East African nations, reflecting more controlled economic conditions.

Kenya

Kenya's inflation rate has shown a gradual increase from 6.1% in 2021 to 7.6% in 2022, and slightly up to 7.7% in 2023. This upward trend suggests a growing cost of living, driven by factors such as food prices and fuel costs. The inflationary pressures in Kenya reflect broader economic challenges faced by the country, impacting consumer purchasing power and cost of living.

Uganda

Uganda's inflation rate was relatively low at 2.2% in 2021 but saw a significant increase to 7.2% in 2022. By 2023, inflation moderated slightly to 5.4%. This fluctuation indicates a period of economic adjustment, likely influenced by changes in global commodity prices and domestic economic policies. The recent decrease might be a sign of stabilizing inflationary pressures.

Rwanda

Rwanda faced a notable increase in inflation, from 0.8% in 2021 to 13.9% in 2022, and slightly easing to 14.0% in 2023. This sharp rise reflects severe inflationary pressures, possibly driven by supply chain disruptions, increased food prices, and other economic challenges. The high inflation rate could impact Rwanda’s economic stability and consumer spending.

Burundi

Burundi saw a dramatic rise in inflation from 8.3% in 2021 to 18.9% in 2022, and peaking at 27.0% in 2023. This significant increase suggests severe economic instability and possibly acute shortages of essential goods. Such high inflation rates could have serious implications for economic growth and the standard of living in Burundi.

South Sudan

South Sudan experienced extreme inflation fluctuations with a staggering rate of 30.2% in 2021, plummeting to -3.2% in 2022, and then skyrocketing to 40.2% in 2023. The drastic changes reflect ongoing economic and political instability, severe supply chain issues, and the impact of conflict on the economy. The high inflation rates are indicative of significant economic distress.

Ethiopia

Ethiopia’s inflation rate was notably high, starting at 26.8% in 2021 and rising to 33.9% in 2022, before slightly decreasing to 30.2% in 2023. This persistent high inflation rate indicates severe economic challenges, likely exacerbated by conflict and economic mismanagement. The high rates pose significant risks to economic stability and growth.

Malawi

Malawi’s inflation surged from 9.3% in 2021 to 20.8% in 2022, and further increased to 30.3% in 2023. This sharp rise points to substantial economic pressures, likely driven by increases in food and fuel prices. The high inflation rate presents a serious challenge to economic stability and the cost of living for Malawians.

Hence, East Africa's inflation trends over the past three years reflect a range of economic conditions from stable to severely distressed. Countries like Tanzania and Kenya have experienced moderate inflation, while others such as Rwanda, Burundi, and South Sudan face more severe economic challenges, evidenced by high inflation rates.

Tanzania's economic development in the context of inflation trends provides several insights

Tanzania's economic development is supported by its stable inflation environment, which fosters confidence among consumers and investors. The government's effective management of inflation contributes to economic stability and growth, positioning Tanzania favorably in comparison to its East African neighbors. Continued monitoring and responsive economic policies will be crucial in maintaining this stability and supporting ongoing development.

Economic Stability

Tanzania's relatively stable inflation rates over 2021-2023 (3.7% in 2021, 4.4% in 2022, and 4.0% in 2023) suggest a degree of economic stability. This stability is beneficial for long-term economic planning and investment, as it reflects a controlled environment where inflation is not fluctuating wildly. Such stability is conducive to business growth and consumer confidence.

Impact on Purchasing Power

The modest inflation rates indicate that the cost of living in Tanzania has not been subject to severe fluctuations. This relative stability helps maintain consumer purchasing power, ensuring that the general population can manage their day-to-day expenses without dramatic changes in prices. Stable inflation also supports economic growth by reducing the uncertainty faced by businesses and consumers.

Policy Effectiveness

The control of inflation within the 4% range over the past three years suggests effective monetary and fiscal policies. It implies that Tanzania's government and central bank have managed to implement strategies that keep inflation in check, such as monetary tightening or fiscal measures. This effective management of inflation reflects positively on Tanzania’s economic policy framework.

Investment Climate

Stable inflation contributes to a favorable investment climate. Investors often seek environments where inflation is predictable, as it reduces the risk associated with price fluctuations. Tanzania's stable inflation rate can attract foreign and domestic investors, fostering economic development and job creation.

Comparative Position

Compared to other East African countries with higher inflation rates (e.g., Kenya at 7.7%, Rwanda at 14.0%, and Burundi at 27.0%), Tanzania's lower and stable inflation rate positions it as a relatively more attractive destination for investment and economic activities. This comparative advantage can enhance Tanzania's appeal as a stable and predictable market.

Potential Risks

While the inflation rate in Tanzania is relatively low, it is essential to monitor any emerging trends or potential risks that could impact future inflation. Factors such as global commodity price fluctuations, domestic economic policies, or external shocks could affect inflation and overall economic stability.

East African countries exhibit varied trade dynamics between 2021 and 2023. Tanzania, Kenya, Uganda, Rwanda, and Burundi all experienced an increase in imports, leading to growing trade deficits. However, Uganda and Tanzania have shown more significant growth in exports compared to others, improving their trade positions relative to the other countries. The data suggests that while export growth is crucial, managing import growth is equally important to balance trade deficits and support economic stability in the region.

Tanzania:

• Exports: Tanzania's merchandise exports grew from $6.43 billion in 2021 to $8.21 billion in 2023, reflecting a growth rate of 18.97%. This places Tanzania's share of total merchandise exports at 1.34% in 2023, a slight increase from previous years.
• Imports: The country’s imports also increased, from $11.17 billion in 2021 to $16.45 billion in 2023. The growth rate of imports was 31.20%, indicating a significant rise in import activity.
• Trade Balance: Tanzania's trade balance has been negative, with a growing trade deficit. The deficit widened from $4.74 billion in 2021 to $8.24 billion in 2023 due to the higher growth rate of imports compared to exports.

Kenya:

• Exports: Kenya’s merchandise exports were $7.43 billion in 2023, showing a slight increase from $7.33 billion in 2021. The growth rate over the period was modest at 2.22%.
• Imports: Imports grew from $20.54 billion in 2021 to $22.05 billion in 2023, with an import growth rate of 7.33%. This represents a moderate increase in import expenditure.
• Trade Balance: Kenya experienced a widening trade deficit from $13.21 billion in 2021 to $14.62 billion in 2023, driven by the higher growth rate of imports compared to exports.

Uganda:

• Exports: Uganda's exports increased substantially from $3.97 billion in 2021 to $5.61 billion in 2023, marking a significant growth rate of 56.37%.
• Imports: Imports also rose from $9.49 billion in 2021 to $10.24 billion in 2023, though the growth rate was slower at 22.73%.
• Trade Balance: Uganda’s trade deficit expanded slightly from $5.52 billion in 2021 to $4.63 billion in 2023 due to the higher growth rate of imports compared to exports.

Rwanda:

• Exports: Rwanda's exports showed a slight decrease from $1.56 billion in 2021 to $1.22 billion in 2023, with a notable decline in growth rate of -21.67%.
• Imports: Imports grew from $3.34 billion in 2021 to $3.74 billion in 2023, with a slower growth rate of 12.03%.
• Trade Balance: Rwanda’s trade deficit increased from $1.78 billion in 2021 to $2.52 billion in 2023, reflecting the higher import growth relative to exports.

Burundi:

• Exports: Burundi's exports increased slightly from $0.19 billion in 2021 to $0.17 billion in 2023. The growth rate of exports was negative at -11.99%.
• Imports: Imports grew modestly from $0.90 billion in 2021 to $1.06 billion in 2023, with a slower growth rate of 24.79%.
• Trade Balance: Burundi’s trade deficit widened from $0.71 billion in 2021 to $0.89 billion in 2023 due to the higher growth rate of imports compared to exports.

Tanzania’s economic development involves analyzing and the key aspects that shape its economic landscape

Tanzania’s economic development involves a multi-faceted approach that addresses infrastructure, industrialization, agriculture, trade, human capital, digital transformation, and good governance. By targeting these areas, Tanzania aims to achieve sustained economic growth and improve the quality of life for its citizens.

1. Economic Growth and Structure

GDP Growth: Tanzania has shown consistent GDP growth over recent years. The economic development strategy focuses on sustaining this growth through various sectors, including agriculture, industry, and services.

Economic Diversification: Efforts are being made to diversify the economy away from agriculture, which currently employs the majority of the population, to more industrial and service-oriented activities. This includes promoting sectors like manufacturing, tourism, and technology.

2. Infrastructure Development

Transport Infrastructure: Investment in transport infrastructure, such as roads, railways, and ports, is crucial. The expansion of Dar es Salaam port and improvement of road networks aim to boost trade and logistics, enhancing Tanzania’s connectivity and regional trade competitiveness.

Energy Sector: Enhancing the energy sector is vital for industrial growth. Investments in both renewable and non-renewable energy sources are underway to address the power supply challenges and support industrialization.

3. Industrialization and Manufacturing

Industrial Policy: The Tanzanian government’s industrial policy aims to increase the contribution of manufacturing to GDP. This involves promoting industrial parks, supporting small and medium-sized enterprises (SMEs), and improving access to finance and technology.

Special Economic Zones (SEZs): Establishing SEZs to attract foreign direct investment (FDI) and boost industrial production is a key focus. These zones offer incentives such as tax breaks and streamlined regulations to attract investors.

4. Agriculture and Rural Development

Agricultural Productivity: Enhancing agricultural productivity through modern techniques, better seed varieties, and irrigation is crucial for food security and income generation in rural areas.

Value Chains: Developing value chains in agriculture, such as agro-processing, aims to add value to raw products, improve export earnings, and create jobs.

5. Trade and Investment

Trade Policy: Tanzania’s trade policy aims to increase export volumes and diversify export products. Efforts are being made to improve trade relations within the East African Community (EAC) and with other international partners.

Investment Climate: Improving the investment climate through regulatory reforms, anti-corruption measures, and infrastructure development is crucial for attracting both domestic and foreign investors.

6. Human Capital Development

Education and Skills: Investing in education and vocational training is essential to develop a skilled workforce that can support economic growth and meet the demands of a modern economy.

Health Sector: Strengthening the health sector to improve public health outcomes is crucial for maintaining a productive workforce and fostering economic development.

7. Digital Economy

Technology Adoption: Emphasizing digital transformation and technology adoption to enhance productivity, financial inclusion, and access to services is a growing focus. This includes expanding internet access and promoting e-commerce.

Innovation: Encouraging innovation and supporting startups and tech hubs can drive economic growth by fostering new industries and creating high-value jobs.

8. Policy and Governance

Economic Reforms: Implementing economic reforms to improve governance, transparency, and efficiency in public service delivery is essential for fostering a conducive environment for growth.

Fiscal Policy: Ensuring sound fiscal management, including effective tax collection and expenditure control, is vital for maintaining economic stability and funding development projects.

Challenges and Opportunities

Challenges: Tanzania faces challenges such as infrastructure deficits, regulatory hurdles, and external economic shocks. Addressing these issues through targeted policies and investment is crucial for sustained development.

Opportunities: The country has opportunities in areas such as natural resources, tourism, and regional trade integration. Leveraging these opportunities can drive economic growth and improve living standards.

Modest Gains Amidst Record-Breaking African Fundraising in July 2024

Despite Africa experiencing a record-breaking fundraising month in July 2024, with $420 million raised, Tanzania's start-up ecosystem saw modest gains, raising $9 million in H1 2024. While this is significantly lower than Kenya's $244 million, it highlights the country's potential for growth. Continued efforts to enhance the start-up environment and attract investments could boost Tanzania's future fundraising performance.

Start-up Fundraising in Africa: Focus on Tanzania

July 2024 Fundraising Overview

• Total Fundraising: $420 million (excluding exits)
  • This is the highest monthly performance in 14 months.
  • The amount raised in July exceeds the total for Q2 2024.
  • It is 2.5 times the average monthly amount raised over the past 12 months.
  • This is the best month of July since tracking began in 2019.

Breakdown of Fundraising Activities

• Number of Ventures: 47 ventures raised at least $100k each in July.
  • This is the second-best month in 2024, following May.
  • 16 ventures raised at least $1 million, aligning with the monthly average in H1 2024.

Major Deals in July 2024

• d.light’s Securitization Facility: $176 million
• MNT-Halan’s Raise: $157.5 million
• NALA’s Series A: $40 million
  • Combined, these three deals represent 90% of the total funding raised in July.

Exits

• Notable Exit: Quicket’s acquisition by Ticketmaster (details not included in the $420 million).

Year-to-Date Performance

• Total Funding in 2024: $1.2 billion
  • This comfortably surpasses the $1 billion mark.
  • The amount raised in 2024 so far has topped the total raised in 2020.
  • The next milestone is $1.4 billion raised in 2019, which is now within reach.

Country-Specific Fundraising in H1 2024

Distribution Among Big Four Countries

• Percentage of Total Funding: 79% of total funding went to start-ups headquartered in one of the Big Four countries (Kenya, Nigeria, South Africa, and Egypt).
  • This is slightly below the 5-year average of 83%.
  • In H1 2023, the Big Four countries attracted 92% of the region’s funding.

Kenya's Dominance

• Total Raised by Kenyan Start-ups: $244 million
  • Kenya leads for the third consecutive semester.
  • 32% of all funding raised by African start-ups in H1 2024 went to Kenya.
  • Kenya's share of total funding grew by 5 percentage points compared to 2023.
  • 86% of all funding raised in Eastern Africa went to Kenya (89% in 2023).

Eastern Africa Funding

• Total Funding in Eastern Africa: $285 million (37.5% of total funding on the continent).
  • Uganda raised $19 million.
  • Tanzania narrowly missed the $10 million mark with $9 million.
  • Sudan, Ethiopia, and Rwanda each raised less than $5 million.

Implications for Tanzania

• Performance in H1 2024: Tanzania raised $9 million.
  • This is significantly lower than Kenya's $244 million.
  • It indicates that while there is activity in Tanzania's start-up ecosystem, it remains relatively small compared to its regional peers.

Hence

• Growth Potential: The impressive fundraising figures for July 2024 indicate a robust and growing start-up ecosystem in Africa, especially in the Big Four countries.
• Tanzania's Position: Despite Tanzania's relatively modest fundraising performance, the country shows potential for growth. Efforts to improve the start-up ecosystem, attract more investments, and support innovation could enhance Tanzania’s share of regional funding in the future.

Driving Economic Growth and Individual Prosperity through Diversification, Innovation, and Sustainability

Goals of Vision 2025 Review

Tanzania's Vision 2025 has set ambitious goals for the nation's development. Significant strides have been made in agriculture, education, gender equality, health, water supply, and poverty reduction. However, challenges such as high transportation costs, gender-based violence, and rural healthcare accessibility still remain. Continued efforts and investments are essential to achieve the goals set out in Vision 2025.

1. Improve the Quality of Life of Tanzanians: This includes ensuring food security, providing primary education for all children, achieving gender equality, ensuring access to quality healthcare, reducing child and maternal mortality, providing clean and safe water, increasing life expectancy, and eradicating extreme poverty.
2. Peace, Security, and Unity: Creating a peaceful and secure environment.
3. Good Governance: Establishing a governance system that promotes democracy and rule of law.
4. Educated and Learning Society: Building a society with high educational standards and lifelong learning.
5. Strong and Competitive Economy: Developing a robust economy capable of competing globally.

Economic Review

1. Agricultural Sector:

• Irrigation Projects: Investments in irrigation, like the project in Singida Municipality (2010-2012) costing 750 million shillings, have significantly increased food production. From 2011/12, total food production reached 13.34 million tons, which includes 7.44 million tons of cereals and 5.90 million tons of non-cereal crops.
• Challenges: High transportation costs impact food prices, making it difficult for many citizens to afford basic necessities.

2. Education:

• Primary Education: The implementation of the Primary Education Development Plan (MMEM) in 2000, which eliminated fees for public primary schools, increased enrollment from 59% in 2000 to 95.4% in 2010.
• School Feeding Program: Initiated in 2000 with the support of the World Food Programme (WFP), the program improved attendance and academic performance, especially in rural areas.

3. Gender Equality:

• Education: Female enrollment in higher education increased to 36.4% in 2012 from 34.2% in 2009.
• Challenges: Despite progress, issues like gender-based violence and discrimination remain prevalent.

4. Health Services:

• Infant and Maternal Health: Infant mortality reduced from 112 per 1,000 live births in 2000 to 81 per 1,000 in 2010. The distribution of malaria treatment drugs at affordable prices and nationwide campaigns to control malaria have significantly improved health outcomes.
• Life Expectancy: Increased from 50 years in 2000 to 57 years in 2010.

5. Water Supply:

• Projects: Completed projects like the Kirua-Kahe water project in Moshi Rural District, serving over 110,000 residents. In Dar es Salaam, 33 deep wells have been drilled to improve water supply.

6. Poverty Reduction:

• MKUKUTA and Millennium Development Goals: These initiatives align with Vision 2025 to reduce poverty and achieve middle-income status. The focus is on utilizing Tanzania's natural resources to boost economic growth and eradicate extreme poverty.

Economic Indicators

• Food Security: Increased agricultural productivity with a surplus of food production (112% of the national requirement).
• Enrollment Rates: Primary school enrollment increased to 95.4%.
• Health Improvements: Reduction in infant mortality and an increase in life expectancy to 57 years.

Success of Vision 2025

Tanzania's Vision 2025 has seen significant progress in various sectors, with notable improvements in food production, education, and healthcare. While there are challenges to address, the foundation laid by these achievements provides a strong basis for continued development and progress towards the goals of Vision 2025. Continued efforts and strategic investments are crucial for overcoming the remaining hurdles and fully realizing the vision's objectives.

1. Quality of Life Improvement:

• Food Production: As of 2022, total food production continued to grow, reaching approximately 15 million tons, which is 115% of the national food requirement. This includes 8 million tons of cereals and 7 million tons of non-cereal crops.
• Healthcare: Infant mortality decreased further to 67 per 1,000 live births. Life expectancy increased to 61 years, reflecting improvements in healthcare services.
• Education: Primary school enrollment remained high at 96.8%, with ongoing support from initiatives such as the Primary Education Development Plan and the elimination of school fees.

2. Peace, Security, and Unity: Tanzania has maintained relative peace and security, which is crucial for economic growth and national unity. Efforts to enhance internal security and social cohesion have been ongoing.
3. Good Governance: The government has made strides in improving governance, with measures to combat corruption and promote transparency. Initiatives to strengthen the rule of law and democratic processes have been implemented, contributing to better governance.
4. Educated and Learning Society:

• Higher Education Enrollment: By 2022, female enrollment in higher education increased to 40%, indicating progress towards gender equality and educational advancement.

5. Strong and Competitive Economy:

• Agriculture Sector: Investments in irrigation and modern farming techniques have continued to boost agricultural productivity. For instance, the Singida Municipality irrigation project now supports even larger food production, and new projects have been initiated across the country.
• Water Supply: Projects like the Kirua-Kahe water project and additional deep wells in Dar es Salaam have significantly improved access to clean water. As of 2022, 68% of the population has access to clean and safe water.

Economic Review

• Food Security: Total food production in 2022 reached 15 million tons, meeting 115% of the national requirement.
• Healthcare: The infant mortality rate decreased to 67 per 1,000 live births, and life expectancy increased to 61 years.
• Education: Primary school enrollment increased to 96.8%, and female enrollment in higher education rose to 40%.

Challenges and Areas for Improvement

Despite the progress, several challenges remain:

• Transportation Costs: High transportation costs continue to impact food prices and overall living costs.
• Gender-Based Violence: Persistent issues of gender-based violence and discrimination need to be addressed.
• Healthcare Access: Ensuring equitable access to healthcare, particularly in rural areas, remains a priority.

Strategic Recommendations for Tanzania's Vision 2050

Tanzania's Vision 2050 should focus on economic diversification, infrastructure development, education, healthcare, agricultural transformation, digital economy, environmental sustainability, financial inclusion, and good governance. By setting ambitious but achievable targets in these areas, Tanzania can ensure sustainable economic growth and improve the living standards of its citizens. Continued investment, effective policy implementation, and collaboration between the government, private sector, and civil society will be crucial for the success of Vision 2050.

Tanzania's Vision 2050 delivers substantial benefits for the nation's economic growth and individual prosperity, the plan should incorporate the following key areas:

1. Economic Diversification and Industrialization:

• Manufacturing Sector: Invest in manufacturing to diversify the economy beyond agriculture. Aim to increase the manufacturing sector's contribution to GDP from the current 8.3% to at least 20% by 2050.
• Value Addition: Promote value addition in agricultural products to increase exports and improve farmer incomes. For instance, processing cashew nuts locally rather than exporting raw nuts.

2. Infrastructure Development:

• Transport Infrastructure: Develop robust road, rail, and port infrastructure to reduce transportation costs. For example, complete the Standard Gauge Railway (SGR) and modernize the Dar es Salaam port.
• Energy Supply: Expand energy infrastructure to ensure reliable electricity supply. Aim to increase electricity access from the current 39% to 75% by 2050, focusing on renewable energy sources.

3. Education and Skills Development:

• Quality Education: Enhance the quality of education at all levels. Increase the national literacy rate from the current 77.9% to 95% by 2050.
• Vocational Training: Expand vocational and technical training to equip the workforce with skills needed for a diversified economy. Set a target to have 50% of secondary school graduates enrolled in vocational training programs.

4. Healthcare Improvements:

• Universal Healthcare: Implement universal healthcare to improve health outcomes. Aim to reduce infant mortality from the current 38 per 1,000 live births to below 10 per 1,000 by 2050.
• Healthcare Infrastructure: Invest in healthcare infrastructure, especially in rural areas, to ensure equitable access to services.

5. Agricultural Transformation:

• Modern Farming Techniques: Promote the adoption of modern farming techniques to increase productivity. Target a 50% increase in agricultural productivity by 2050.
• Rural Development: Invest in rural infrastructure, including irrigation systems, to support agriculture and reduce poverty. Aim to reduce rural poverty from the current 33.3% to 10% by 2050.

6. Digital Economy and Innovation:

• ICT Infrastructure: Invest in ICT infrastructure to support a digital economy. Aim to increase internet penetration from the current 45% to 90% by 2050.
• Innovation Hubs: Establish innovation hubs to foster entrepreneurship and technological advancements.

7. Environmental Sustainability:

• Climate Resilience: Develop strategies for climate resilience to protect the environment and sustain agriculture. Aim to reduce deforestation rates and increase forest cover from the current 55% to 65% by 2050.
• Sustainable Practices: Promote sustainable farming and industrial practices to minimize environmental impact.

8. Financial Inclusion:

• Access to Credit: Enhance access to credit for small and medium-sized enterprises (SMEs) and individuals. Increase the percentage of the population with access to financial services from the current 28% to 75% by 2050.
• Microfinance: Expand microfinance programs to support entrepreneurship and economic activities at the grassroots level.

9. Good Governance and Institutional Strengthening:

• Anti-Corruption Measures: Strengthen anti-corruption measures to ensure transparent and accountable governance.
• Public Services: Improve the efficiency and effectiveness of public services to build trust in government institutions.

Doing Business in Tanzania 2024

A snapshot of the business environment in Tanzania, highlighting areas of strength and opportunities for regulatory and procedural improvements.

Starting Business - 40%

• Indicator Description: This measures the procedures, time, cost, and paid-in minimum capital to start a limited liability company.
• Implication: With a score of 40%, it indicates there are significant challenges or bureaucratic hurdles involved in starting a business in Tanzania. Improvements in simplifying procedures and reducing costs could enhance this score.

Contracts with the Government - 60%

• Indicator Description: This typically measures the ease of securing contracts with government entities, including transparency and fairness in the procurement process.
• Implication: A 60% score suggests a moderate level of efficiency and fairness in dealing with government contracts, but there is room for improvement in transparency and reducing bureaucratic barriers.

Employing Workers - 80%

• Indicator Description: This looks at regulations regarding hiring, working hours, redundancy, and cost of labor.
• Implication: An 80% score indicates a relatively flexible and favorable environment for hiring workers, suggesting that labor laws and regulations are conducive to business operations.

Resolving Insolvency - 61%

• Indicator Description: This assesses the time, cost, and outcome of insolvency proceedings, including the recovery rate.
• Implication: With a score of 61%, Tanzania shows moderate effectiveness in handling insolvency cases. There might be inefficiencies in the process that could be streamlined to improve the recovery rate and reduce the time and cost involved.

Trading Across Borders - 65%

• Indicator Description: This measures the time and cost associated with the logistical process of exporting and importing goods.
• Implication: A 65% score suggests a moderate level of ease in trading across borders, but there are likely logistical challenges and costs that can be optimized to facilitate smoother international trade.

Paying Taxes - 30%

• Indicator Description: This evaluates the tax burden on businesses, including the number of taxes paid, the method of tax payment, and the overall tax rate.
• Implication: A low score of 30% indicates a high tax burden or a complex tax system, suggesting significant room for reform to simplify tax compliance and reduce the financial load on businesses.

Getting Credit - 60%

• Indicator Description: This looks at the ease of obtaining credit, including the strength of legal rights and the depth of credit information.
• Implication: A 60% score suggests moderate access to credit for businesses, indicating that while some mechanisms are in place to facilitate credit, there are barriers or limitations that could be addressed to improve credit availability.

Enforcing Contracts - 70%

• Indicator Description: This measures the efficiency of the judicial system in resolving commercial disputes, including time, cost, and the quality of judicial processes.
• Implication: A score of 70% reflects a reasonably effective system for enforcing contracts, though there is still potential for improvements in reducing delays and costs associated with litigation.

Protecting Minority Investors - 80%

• Indicator Description: This evaluates the protection of minority shareholders' interests against misuse by company directors.
• Implication: An 80% score indicates strong legal protections for minority investors, suggesting a business environment that supports investor confidence and equitable treatment.

Registering Property - 55%

• Indicator Description: This measures the procedures, time, and cost to transfer property and the quality of the land administration system.
• Implication: A score of 55% implies moderate difficulty in property registration, with potential issues in the efficiency or transparency of the process that could be improved.

Getting Electricity - 65%

• Indicator Description: This assesses the reliability of electricity supply and the procedures, time, and cost required to obtain a new electricity connection.
• Implication: A 65% score suggests a reasonably stable electricity supply but indicates that the process to get connected could be streamlined to be more business-friendly.

Dealing with Construction Permits - 79%

• Indicator Description: This evaluates the procedures, time, and cost involved in constructing a warehouse, including obtaining necessary licenses and permits.
• Implication: A score of 79% indicates a relatively efficient process for obtaining construction permits, though there might still be some bureaucratic steps that could be further optimized.

Strategic Recommendations on ease of doing business in Tanzania, focusing on procedures, time, and cost

1. Starting Business (40%)

• Procedures: Simplify the registration process by reducing the number of steps and making it possible to complete all procedures online.
  • Time: Streamline processes to reduce the time required to register a business by introducing a single-window system where all necessary approvals can be obtained in one place.
  • Cost: Lower the registration fees and eliminate unnecessary costs associated with starting a business. Offer incentives or subsidies for startups and small businesses.

2. Contracts with the Government (60%)

• Procedures: Increase transparency in the procurement process by standardizing and simplifying application procedures and ensuring they are clearly documented and easily accessible.
  • Time: Reduce the time taken to award contracts by implementing electronic procurement systems and setting clear timelines for each stage of the process.
  • Cost: Minimize costs associated with bidding for government contracts by reducing or eliminating fees and simplifying the financial requirements for participation.

3. Employing Workers (80%)

• Procedures: Continue to streamline hiring processes and ensure that labor laws are clearly communicated to both employers and employees.
  • Time: Maintain efficient timelines for processing employment-related documentation, such as work permits and employee registrations.
  • Cost: Ensure that costs related to hiring, such as social security contributions and other mandatory payments, are reasonable and competitive.

4. Resolving Insolvency (61%)

• Procedures: Simplify the legal framework for insolvency proceedings, making it easier for businesses to understand and navigate.
  • Time: Implement measures to speed up the resolution of insolvency cases by increasing the capacity of courts and insolvency practitioners.
  • Cost: Reduce the costs associated with insolvency proceedings by setting fee caps and providing support services for struggling businesses.

5. Trading Across Borders (65%)

• Procedures: Simplify customs procedures and documentation requirements, and ensure that all necessary information is available online.
  • Time: Reduce the time required for border compliance by improving infrastructure at ports and borders, and by implementing advanced customs technologies.
  • Cost: Lower costs associated with importing and exporting by reducing tariffs and fees and improving the efficiency of customs operations.

6. Paying Taxes (30%)

• Procedures: Simplify the tax filing process by reducing the number of tax payments and consolidating taxes where possible. Implement an easy-to-use online tax filing system.
  • Time: Reduce the time required to prepare and file taxes by providing clear guidelines and support to businesses. Ensure that tax authorities are efficient and responsive.
  • Cost: Lower the overall tax burden by reviewing and possibly reducing tax rates, and by eliminating unnecessary or redundant taxes.

7. Getting Credit (60%)

• Procedures: Improve access to credit information by expanding credit bureaus and ensuring that they provide comprehensive and accurate data.
  • Time: Streamline the process for obtaining credit by reducing the documentation and approval time required by financial institutions.
  • Cost: Encourage competitive interest rates and reduce collateral requirements by promoting a healthy financial sector and supporting alternative lending options.

8. Enforcing Contracts (70%)

• Procedures: Simplify legal procedures for contract enforcement and ensure that all relevant laws and regulations are accessible and understandable.
  • Time: Speed up judicial processes by increasing the efficiency of courts and reducing case backlogs.
  • Cost: Lower the costs of litigation by providing affordable legal aid and capping legal fees.

9. Protecting Minority Investors (80%)

• Procedures: Ensure that regulations protecting minority investors are robust and clearly enforced.
  • Time: Maintain prompt response times for addressing investor grievances and disputes.
  • Cost: Ensure that the costs associated with investor protection are minimal, encouraging more investment activity.

10. Registering Property (55%)

• Procedures: Simplify the property registration process by reducing the number of steps and making more services available online.
  • Time: Reduce the time required to register property by streamlining bureaucratic processes and increasing the efficiency of land administration offices.
  • Cost: Lower the costs associated with property registration by reducing fees and eliminating unnecessary charges.

11. Getting Electricity (65%)

• Procedures: Simplify the process for obtaining electricity connections by reducing the number of required approvals and making the application process available online.
  • Time: Speed up connection times by improving the efficiency of utility providers and investing in infrastructure upgrades.
  • Cost: Lower the costs associated with getting electricity by reducing connection fees and offering subsidies or incentives for new connections.

12. Dealing with Construction Permits (79%)

• Procedures: Continue to streamline the process for obtaining construction permits by reducing bureaucratic steps and ensuring transparency.
  • Time: Maintain efficient timelines for processing construction permits by increasing the capacity and responsiveness of relevant authorities.
  • Cost: Ensure that fees for construction permits are reasonable and competitive, and provide support for small and medium-sized construction projects.

Overview

Agriculture is a cornerstone of Tanzania's economy, playing a pivotal role in the country's industrialization by providing markets for industrial products and raw materials. Tanzania boasts 44 million hectares of arable land, with an estimated 29.4 million hectares suitable for irrigation, indicating significant potential for agricultural expansion and intensification.

Quick Facts

• Employment: Agriculture employs about 67% of Tanzania's employed population, highlighting its importance in providing livelihoods and supporting the broader economy.
• Livestock: Tanzania has the second-largest livestock population in Africa, underlining its potential in the meat and dairy industries.
• Meat Processing: Less than 1% of all meat is processed locally, while large quantities of processed meat are imported. This represents a significant opportunity for the development of local meat processing industries.
• Freshwater Resources: The area of freshwater cover is estimated at 54,337 square kilometers, accounting for about 6.1% of Tanzania's total surface area. These freshwater resources are crucial for agriculture, fisheries, and domestic use.
• Marine Resources: Tanzania has a Territorial Sea covering 64,000 square kilometers, an Exclusive Economic Zone (EEZ) of about 223,000 square kilometers, and a 1,424-kilometer coastline along the Indian Ocean. These marine resources offer substantial potential for the fishing industry and other maritime activities.
• Sugar Production: Tanzania produces approximately 300,000 tonnes of raw sugar annually (based on 2014/2015 figures), leaving a demand gap of about 220,000 tonnes to be met through imports. The sugar supply gap is projected to increase at an estimated 6% per annum from the current 300,000 tonnes per year.
• Sugar Estates: There are four existing sugar estates in Tanzania, collectively producing 300,000 tonnes of sugar per year, operating at full capacity.
• Cane Yields: Tanzania has some of the highest average cane yields globally, at 120 tonnes per hectare, due to favorable soils and climate conditions.
• Irrigation Potential: With ample rainfall and rivers fed by the high hinterland plateaus, Tanzania has some of the best irrigation potential in the sub-region, offering significant opportunities for expanding irrigated agriculture.
• Soil and Topography: The soil and topography in target sugar zones are ideal for industrial sugarcane cultivation, further supporting the potential for growth in this sector.
• Edible Oil Imports: Tanzania spends over US$ 150,000 annually to import edible oil. The lack of modern mechanical extraction equipment and low agricultural productivity have made Tanzania reliant on imported edible oil.
• Potential for Edible Oil Industry: Tanzania has the potential to develop a competitive edible oil industry based on sunflower, cotton, groundnuts, soya beans, and palm. With increased production and productivity, these crops could support a robust edible oil industry for both the domestic and regional markets.

Strategic Implications

The agricultural sector's central role in Tanzania's economy underscores the need for strategic investments in infrastructure, technology, and skills development to enhance productivity and value addition. Key areas for development include meat processing, sugar production, and the edible oil industry. Addressing these areas can significantly reduce import reliance, create jobs, and stimulate economic growth.

Hence, leveraging Tanzania's vast freshwater and marine resources can further support agricultural diversification and sustainability.

Key Insights on Tanzania's Diplomatic Economy

Tanzania can strengthen its agricultural sector's role in the diplomatic economy, driving economic growth and improving international standing.

1. Agricultural Employment and Livelihoods:
   • Diplomatic Leverage: Agriculture employs about 67% of Tanzania's population. This substantial workforce can be leveraged diplomatically to secure international support for agricultural development, including technology transfer, training, and investment in infrastructure.
   • Bilateral and Multilateral Agreements: Tanzania can negotiate favorable trade agreements and development partnerships that focus on agricultural advancements and employment creation.
2. Livestock and Meat Processing:
   • Investment Attraction: As the second-largest livestock population in Africa, Tanzania has a significant opportunity to attract foreign direct investment (FDI) into its meat processing industry. Emphasizing this potential in diplomatic discussions can lead to collaborations that enhance local processing capacities.
   • Regional Trade Opportunities: Strengthening the meat processing industry locally can position Tanzania as a regional hub for processed meat, boosting exports to neighboring countries and beyond.
3. Freshwater and Marine Resources:
   • Sustainable Resource Management: Diplomatic efforts can focus on securing international assistance for sustainable management of freshwater and marine resources. Partnerships with countries experienced in these areas can help develop Tanzania's fishing industry and improve water resource management.
   • Blue Economy Initiatives: Tanzania's extensive EEZ and coastline provide opportunities for blue economy initiatives, which can attract international interest and investment in sustainable maritime industries, fisheries, and tourism.
4. Sugar Production and Processing:
   • Closing the Supply Gap: The demand gap for sugar presents an opportunity for diplomatic engagements aimed at attracting investment into the sugar industry. International partnerships can help expand production capacity and reduce reliance on imports.
   • Technological and Capacity Building: Diplomatic negotiations can secure technical assistance and capacity-building programs from countries with advanced sugar industries, improving local yields and processing capabilities.
5. Edible Oil Industry Potential:
   • Import Substitution: Reducing reliance on imported edible oil by developing local production capacities is a strategic priority. Diplomatic efforts can focus on partnerships for modern mechanical extraction equipment and agricultural productivity enhancement.
   • Regional Market Integration: Tanzania can position itself as a key player in the regional edible oil market by leveraging diplomatic ties to foster regional integration and cooperation, ensuring a steady market for its products.
6. Agricultural Technology and Innovation:
   • Diplomatic Alliances: Forming alliances with countries known for their agricultural technology and innovation can bring advanced techniques and equipment to Tanzania. This can enhance productivity, sustainability, and overall sector growth.
   • Research and Development: Diplomatic efforts can include agreements for joint research and development projects, focusing on crop improvement, pest control, and climate resilience, vital for Tanzania's agricultural sustainability.
7. Economic Diplomacy:
   • Export Promotion: Leveraging diplomatic channels to promote Tanzanian agricultural products in international markets can boost exports, create jobs, and generate foreign exchange.
   • Trade Negotiations: Engaging in trade negotiations to reduce tariffs and non-tariff barriers on Tanzanian agricultural products can enhance competitiveness and market access.

Strategic Recommendations

• Enhance Diplomatic Engagements: Prioritize agricultural development in diplomatic dialogues, focusing on technology transfer, investment, and capacity-building.
• Strengthen Trade Partnerships: Develop strategic trade partnerships to promote Tanzanian agricultural products, reduce barriers, and secure better market access.
• Promote Sustainable Practices: Collaborate with international partners to implement sustainable agricultural and resource management practices.
• Invest in Infrastructure: Seek international support for infrastructure development crucial for agriculture, such as irrigation systems, roads, and processing facilities.
• Foster Regional Cooperation: Utilize regional bodies and agreements to enhance agricultural trade and collaboration, benefiting from shared resources and markets.

Mobile money subscriptions and transactions and growing digital economy in Tanzania

1. Growth in Subscriptions:
   • Mobile money subscriptions increased by 5% from 53 million accounts in March 2024 to 56 million in June 2024.
   • The average monthly growth rate during this period was 1.9%.
2. Subscription Numbers by Provider (March 2024 vs. June 2024):
   • Airtel Money: Increased from 10,868,814 to 11,028,579.
   • Halo Pesa: Increased from 4,379,419 to 4,567,319.
   • Tigo Pesa: Increased from 17,266,651 to 17,827,565.
   • T-Pesa: Increased from 1,412,639 to 1,422,381.
   • M-Pesa: Increased from 20,416,700 to 20,677,223.
   • Azam Pesa: Increased from 102,138 to 187,691.
   • Total: Increased from 54,446,361 to 55,710,758.
3. Market Share:
   • M-Pesa leads the market with a 37.2% share.
   • Tigo Pesa and Airtel Money, along with M-Pesa, control approximately 89% of the market.
4. Monthly Figures:
   • For April 2024, the total subscriptions were 53,691,317.
   • For May 2024, the total subscriptions were 54,446,361.
   • For June 2024, the total subscriptions were 55,710,758.

The robust growth and significant market competition among the major mobile money service providers in Tanzania​.

Mobile Money Transactions

Table 1: Mobile Money Transactions (Quarter ending June 2024)

Table 2: Trend of Mobile Money Transactions in the Past Five Years

Key Points:

• Quarterly Data (April - June 2024):
  • The number of subscriptions decreased from April (85.2 million) to June (80.3 million).
  • The number of transactions increased from April (3.02 billion) to June (3.75 billion).
  • The average number of transactions per subscriber remained fairly stable at around 106 transactions.
• Annual Trends (2019 - 2023):
  • The number of subscriptions has been increasing steadily, from 25.86 million in 2019 to 52.88 million in 2023.
  • The number of transactions also increased significantly from 3.02 billion in 2019 to 5.27 billion in 2023.
  • The average number of transactions per subscriber decreased from 117 in 2019 to 100 in 2023.

The growing use of mobile money services in Tanzania, both in terms of the number of subscriptions and the total number of transactions, despite a slight decline in the average number of transactions per subscriber.

Mobile Money Subscriptions and Transactions

Mobile money subscriptions and transactions reveals a dynamic and growing digital economy in Tanzania. The high growth rates in both subscriptions and transactions reflect increased financial inclusion and active usage, which are essential for a thriving digital economy. These trends are likely to continue driving economic growth, innovation, and improved access to services across the country.

Subscriptions Growth:

• Quarterly Data (April - June 2024):
  • Subscriptions increased by 5%, from 53 million in March 2024 to 56 million in June 2024.
  • The total number of subscriptions in June 2024 was 55.7 million.

Transactions Growth:

• Quarterly Data (April - June 2024):
  • Transactions increased from 3.02 billion in April 2024 to 3.75 billion in June 2024.
  • The number of transactions in June 2024 was 3.75 billion.

Key Insights for Tanzania's Digital Economy

Rapid Adoption and Usage:

• High Subscription Growth: The increase in mobile money subscriptions reflects a strong adoption rate of mobile financial services. From March 2024 to June 2024, subscriptions grew by 5%.
• Rising Transactions: There is a corresponding rise in the number of transactions, which increased by 24.1% from April 2024 (3.02 billion) to June 2024 (3.75 billion). This indicates that users are not only subscribing but actively using mobile money services.

Average Transactions per Subscriber:

• Stable Usage per Subscriber: The average number of transactions per subscriber remained relatively stable, around 106 transactions per subscriber per month in the quarter ending June 2024. This consistency suggests that each subscriber regularly uses mobile money services.

Annual Trends:

• Five-Year Growth:
  • Subscriptions grew from 25.86 million in 2019 to 52.88 million in 2023, more than doubling over five years.
  • Transactions grew from 3.02 billion in 2019 to 5.27 billion in 2023, indicating a significant increase in usage.
  • Despite the growth in subscriptions, the average number of transactions per subscriber decreased from 117 in 2019 to 100 in 2023. This may suggest a broader base of users with varying transaction frequencies, possibly including more occasional users.

Economic Implications

1. Financial Inclusion:
   • Broad Access: The high growth in mobile money subscriptions signifies increasing financial inclusion. More Tanzanians are gaining access to financial services through mobile platforms, which is crucial for a cashless economy.
   • Active Usage: The rise in transactions indicates that these services are being actively used for daily transactions, savings, and possibly even credit and insurance products.
2. Digital Economy Growth:
   • E-commerce and Services: The widespread use of mobile money facilitates e-commerce, enabling transactions for goods and services online. This supports the growth of digital marketplaces.
   • Government Services: Mobile money can be used to pay for public services, taxes, and utilities, streamlining government revenue collection and service delivery.
3. Economic Stability and Growth:
   • Transactional Data: The data generated from mobile money transactions can provide insights into economic activity and help in policy formulation.
   • Investment Attraction: The robust growth and high penetration rates can attract investments in fintech and other digital services.

The total number of internet subscriptions in Tanzania saw a significant increase from March to June 2024. This includes both mobile and fixed internet subscriptions, covering various technologies like 2G, 3G, 4G, 5G, and fiber optics.

Figures 1:

Growth:

• March 2024: 36.8 million subscriptions
• June 2024: 39.3 million subscriptions
• Increase: 7% from March to June 2024

Technology Breakdown (June 2024):

• Mobile Broadband Subscriptions: 39,311,477 (99.6% of total subscriptions)
• 2G Subscriptions: 17,740,031
• FTTH (Fiber to the Home) Subscriptions: 50,398
• FTTO (Fiber to the Office) Subscriptions: 5,732

Trends: The trend in internet subscriptions over the past five years indicates a consistent growth, with an average annual growth rate of 9.8%. Subscriptions rose from 25.8 million in 2019 to 35.9 million in 2023.

Data Usage:

• April 2024: 140,000,149,653 MB (3,755 MB per subscription)
• May 2024: 136,754,260,519 MB (3,575 MB per subscription)
• June 2024: 149,067,375,618 MB (3,792 MB per subscription)

The increasing reliance on mobile broadband as the primary means of internet access, reflecting the broader trend of mobile-first connectivity in Tanzania's digital economy. The steady increase in subscriptions and data usage points to a growing demand for internet services and improved connectivity infrastructure.

The rapid growth in internet subscriptions, primarily driven by mobile broadband, showcases the expanding digital economy in Tanzania. The consistent increase in data usage per subscriber indicates a deepening engagement with digital services, which is critical for the country's economic development and digital transformation initiatives.

Internet Subscription and its Implications for Tanzania's Digital Economy

Growth in Internet Subscriptions

• Significant Increase: From March to June 2024, internet subscriptions increased by 7%, from 36.8 million to 39.3 million. This growth indicates a rapidly expanding user base for internet services.
• Mobile Broadband Dominance: The overwhelming majority of internet subscriptions are mobile broadband (99.6% in June 2024), reflecting a mobile-first approach to internet access in Tanzania.

Technology Breakdown

• 2G Subscriptions: 17.74 million subscriptions in June 2024, indicating a substantial user base still relying on older technology.
• Mobile Broadband Subscriptions: 21.47 million in June 2024, showing a shift towards more advanced and faster mobile internet services.
• FTTH and FTTO: Relatively low numbers (50,398 for FTTH and 5,732 for FTTO in June 2024), indicating that fiber optic connectivity is still in its early stages of adoption.

Data Usage Trends

• Increasing Data Consumption: Data usage per subscription increased from 3,575 MB in May 2024 to 3,792 MB in June 2024. This trend suggests that subscribers are increasingly using the internet for data-intensive activities such as streaming, online education, and e-commerce.

Implications for Tanzania's Digital Economy

The growth in internet subscriptions and data usage is a positive indicator of Tanzania's evolving digital economy. The predominance of mobile broadband underscores a mobile-first approach, driving broad digital inclusion and creating opportunities for digital services and economic growth. However, continued investment in infrastructure and efforts to bridge the digital divide are crucial to sustaining this momentum and ensuring that all Tanzanians can benefit from the digital revolution.

1. Broad Digital Access and Inclusion
   • Widespread Connectivity: The significant increase in internet subscriptions, particularly mobile broadband, highlights the expanding reach of digital connectivity across Tanzania. This broad access is essential for inclusive digital participation, allowing more citizens to benefit from digital services.
2. Mobile-First Economy
   • Predominance of Mobile Broadband: With mobile broadband accounting for nearly all internet subscriptions, Tanzania's digital economy is heavily reliant on mobile connectivity. This trend aligns with global patterns in developing countries, where mobile networks are often the primary means of internet access.
3. Opportunities for Digital Services
   • Growing Market for Digital Products: The rising number of internet users presents a substantial market for digital services, including e-commerce, digital banking, online education, and entertainment. Businesses can leverage this growing user base to expand their digital offerings.
   • E-Government Services: Increased internet penetration provides an opportunity for the government to enhance the delivery of public services through e-government initiatives, improving efficiency and accessibility.
4. Challenges and Areas for Improvement
   • Need for Infrastructure Development: The relatively low adoption of fiber optic internet (FTTH and FTTO) indicates the need for further investment in high-speed broadband infrastructure to support more advanced digital applications and services.
   • Bridging the Digital Divide: While internet subscriptions are growing, efforts must continue to ensure that all regions, especially rural areas, have access to reliable and affordable internet services.
5. Economic Growth and Innovation
   • Digital Transformation: The increasing internet subscriptions and data usage reflect ongoing digital transformation, which can drive economic growth, innovation, and productivity across various sectors, including agriculture, health, education, and commerce.
   • Investment Attraction: The expanding digital economy can attract local and foreign investments in technology and telecommunications sectors, further boosting economic development.

The total number of telecom subscriptions (including both SIM cards and fixed lines for both Person-to-Person (P2P) and Machine-to-Machine (M2M) communication) reached 76.6 million by the end of June 2024. This represents a 4.3% increase from the previous quarter, which ended in March 2024 with 73.4 million subscriptions.

P2P Communication

Telecom subscriptions for P2P communication per operator showed an average monthly increase of 2% from April to June 2024. The breakdown of P2P subscriptions by operator is as follows:

• Airtel: Increased from 19,189,159 in April to 19,507,893 in June.
• Halotel: Increased from 9,116,374 in April to 9,821,837 in June.
• Tigo: Increased from 20,345,932 in April to 21,517,857 in June.
• TTCL: Increased from 1,637,782 in April to 1,651,331 in June.
• Vodacom: Increased from 22,326,386 in April to 23,089,088 in June.

Overall, P2P subscriptions increased from 72.6 million in March 2024 to 75.6 million in June 2024, marking a 4.3% rise​.

M2M Communication

The number of SIM cards subscribed for M2M communication per operator for the quarter ending June 2024 is detailed below:

• Airtel: Increased from 323,273 in April to 329,292 in June.
• Halotel: Increased from 54,920 in April to 57,340 in June.
• Tigo: Decreased slightly from 24,859 in April to 24,755 in June.
• TTCL: Decreased slightly from 6,542 in April to 6,512 in June.
• Vodacom: Increased from 533,906 in April to 551,541 in June.

Total M2M subscriptions rose from 943,500 in March 2024 to 969,440 in June 2024, indicating a 4.3% growth​​.

Market Share

• P2P Market: No single operator has a market share greater than 35%, indicating healthy competition. Market shares are as follows: Vodacom (30.5%), Airtel (28.5%), Tigo (25.8%), Halotel (13.0%), and TTCL (2.2%)​(Communication Statistic…)​.
• M2M Market: Vodacom dominates with 56.9% of subscriptions, followed by Airtel (34.0%), Halotel (5.9%), Tigo (2.6%), and TTCL (0.7%)​.

Trends Over Five Years

The telecom subscription trends for P2P communication over the past five years have shown a significant increase, with total subscriptions growing from 47.8 million in 2019 to 70.3 million in 2023. The penetration rate has increased from 78% in 2019 to 111% in 2023​​.

These statistics reflect a growing and competitive telecom market in Tanzania, with substantial increases in both P2P and M2M subscriptions across various operators.

Tanzania's Digital Economy

The telecom subscription statistics reflect a positive trajectory for Tanzania's digital economy, marked by significant growth, high penetration rates, and competitive dynamics. These trends suggest a strong foundation for expanding digital services, fostering economic opportunities, and enhancing overall connectivity, which are critical for a thriving digital economy.

Growth and Penetration

• Increasing Subscriptions: The rise in telecom subscriptions from 73.4 million in March 2024 to 76.6 million in June 2024 shows a robust growth trajectory. This 4.3% quarterly increase indicates a rapidly expanding user base, crucial for digital economic activities.
• High Penetration Rate: With a penetration rate surpassing 111% in 2023, the majority of Tanzanians have access to mobile connectivity. This widespread access is foundational for digital services, e-commerce, mobile banking, and online education.

Market Competitiveness

• Healthy Competition: No single operator dominates the P2P market, with the largest share held by Vodacom at 30.5%. This competitive environment can drive innovation, better services, and lower prices, benefiting consumers and fostering digital inclusivity.
• Dominance in M2M: Vodacom’s 56.9% share in M2M subscriptions points to its leading role in supporting IoT (Internet of Things) applications, which are crucial for sectors like agriculture, healthcare, and logistics in the digital economy.

Technological Adoption

• P2P and M2M Growth: The significant increase in both P2P (people-to-people) and M2M (machine-to-machine) communication subscriptions highlights the adoption of digital technologies across various sectors. The rise in M2M subscriptions, in particular, underscores the growing reliance on connected devices and smart solutions.

Economic Opportunities

• Digital Services Expansion: The growing number of telecom subscriptions provides a larger customer base for digital services such as mobile payments (M-Pesa, Tigo Pesa), online shopping platforms, and digital content services. This expansion drives economic activities and opens new business opportunities.
• Rural Connectivity: The increase in subscriptions across operators suggests efforts to enhance rural connectivity, which is crucial for inclusive economic growth. Improved rural connectivity can enhance agricultural productivity, access to markets, and delivery of government services.

Trends and Future Prospects

• Five-Year Growth Trends: The growth from 47.8 million subscriptions in 2019 to 70.3 million in 2023 indicates a rapidly maturing digital economy. This trend suggests continued investments in digital infrastructure and services.
• Policy Implications: The data supports the need for policies that encourage competition, investment in infrastructure, and digital literacy programs to sustain growth and ensure broad-based participation in the digital economy.

Tanzania inafanya hatua katika maendeleo ya kidijitali, lakini bado ina safari ndefu kufikia baadhi ya wenzao wa Afrika Mashariki. Ufikiaji na Matumizi ya Intaneti

1. Viwango vya Upenyaji wa Intaneti:
   • Tanzania: Upenyaji wa intaneti ni takriban 45%.
   • Kenya: Upenyaji wa juu zaidi kwa takriban 85%.
   • Uganda: Upenyaji wa intaneti ni takriban 52%.
   • Rwanda: Upenyaji wa takriban 58%. Maana: Tanzania ipo nyuma ya wenzao wa kikanda kama Kenya na Rwanda kwa suala la upenyaji wa intaneti. Hii inaonyesha fursa kubwa ya ukuaji katika ufikiaji wa kidijitali na kuboresha miundombinu nchini Tanzania kufikia wastani wa kikanda. Miundombinu ya Kidijitali
2. Usajili wa Simu za Mkononi:
   • Tanzania: Kiwango cha upenyaji wa simu za mkononi ni 82%.
   • Kenya: Upenyaji karibu wote kwa kiwango cha 112%.
   • Uganda: Kiwango cha upenyaji wa simu za mkononi ni 73%.
   • Rwanda: Upenyaji wa 79%. Maana: Upenyaji wa simu za mkononi nchini Tanzania ni wa juu lakini bado ni chini ikilinganishwa na Kenya. Hii inaonyesha miundombinu imara ya simu za mkononi lakini pia inaonyesha nafasi ya kupanuka na kuboresha zaidi, hasa katika maeneo ya vijijini. Huduma za Kifedha za Kidijitali
3. Akaunti za Pesa za Mkononi:
   • Tanzania: Takriban 52% ya idadi ya watu wazima hutumia pesa za mkononi.
   • Kenya: Inayoongoza na 79% ya matumizi ya pesa za mkononi.
   • Uganda: Takriban 51% ya watu wazima hutumia pesa za mkononi.
   • Rwanda: Takriban 39% ya watu wazima hutumia pesa za mkononi. Maana: Tanzania inafanya vizuri katika matumizi ya pesa za mkononi, na zaidi ya nusu ya idadi ya watu wazima wakihusika, lakini bado inabaki nyuma ya Kenya, ikionyesha uwezekano wa ukuaji zaidi na upitishaji wa huduma za kifedha za kidijitali. Upitishaji wa E-commerce
4. Manunuzi ya Mtandaoni:
   • Tanzania: Takriban 5% tu ya idadi ya watu wanashiriki katika manunuzi mtandaoni.
   • Kenya: Takriban 12% ya idadi ya watu wanashiriki katika manunuzi mtandaoni.
   • Uganda: Takriban 4% wanashiriki katika manunuzi mtandaoni.
   • Rwanda: Takriban 6% wanashiriki katika manunuzi mtandaoni. Maana: Upitishaji wa e-commerce nchini Tanzania ni wa chini, ikionyesha uwezekano mkubwa usiotumika katika soko la e-commerce. Hii inaonyesha haja ya kuimarisha elimu ya kidijitali, kuamini katika miamala ya mtandaoni, na miundombinu ya usafirishaji ili kuongeza viwango vya manunuzi mtandaoni. Mambo Muhimu

• Mgawanyiko wa Kidijitali: Kuna mgawanyiko mkubwa wa kidijitali ndani ya Afrika Mashariki, ambapo Kenya mara nyingi inaongoza katika viashiria vingi vya uchumi wa kidijitali. Tanzania, ingawa inaonyesha maendeleo, bado ina nafasi kubwa ya kuboresha kufikia viwango vya majirani zake kama Kenya na Rwanda.
• Mahitaji ya Uwekezaji: Ili kuboresha nafasi yake, Tanzania inahitaji kuwekeza katika miundombinu ya kidijitali, kuboresha upatikanaji wa intaneti, na kukuza elimu ya kidijitali na uaminifu miongoni mwa watu wake.
• Fursa za Ukuaji: Viwango vya chini vya upenyaji na upitishaji katika maeneo kama ufikiaji wa intaneti na e-commerce vinaonyesha fursa kubwa za ukuaji na maendeleo katika uchumi wa kidijitali wa Tanzania.