In April 2025, Tanzania’s tourism sector recorded an 11.5% increase in arrivals to 2,162,487, generating USD 3,842.6 million in services receipts, a 7.1% rise from ~USD 3,589.9 million in 2024, reinforcing its role as a key driver of the economy (56.0% of services exports). Reinvesting these revenues into human capital development—education and health, which account for 19.9% of external debt use—can foster inclusive growth and reduce reliance on volatile sectors like tourism. By allocating a portion of the USD 3,842.6 million to targeted programs, such as teacher training, healthcare infrastructure, and vocational skills, Tanzania can enhance workforce productivity and diversify its economy. Key issues include tourism revenue volatility, limited human capital investment, and economic diversification challenges. Strategies like earmarking tourism taxes, public-private partnerships (PPPs), and community-based training programs can ensure sustainable human capital development, supporting Tanzania’s Vision 2025 and 6% GDP growth projection for 2025.

Main Key Issues

1. Tourism Revenue Volatility and Economic Contribution
   • Strong Tourism Performance: The 11.5% increase in tourist arrivals to 2,162,487 in April 2025, compared to 1,938,875 in April 2024, drove services receipts to USD 3,842.6 million, up 7.1% from ~USD 3,589.9 million (previous responses). Tourism accounts for 56.0% of total services receipts (USD 6,940.8 million) and ~10% of GDP, with projections to reach 19.5% by 2025/26. TICGL confirm a record 2,106,870 arrivals by November 2024, generating USD 3,680 million.
   • Volatility Risks: Tourism is vulnerable to external shocks, such as pandemics (e.g., 2020 arrivals dropped to 616,491), geopolitical tensions, or climate events affecting attractions like Serengeti or Kilimanjaro. The Monthey Economic Review notes seasonal foreign exchange inflows (previous responses), highlighting tourism’s cyclical nature. This volatility contributed to a current account deficit of USD 2,224.9 million in April 2025, despite an 18.6% improvement (previous responses).
   • Revenue Potential: Tourism generates direct revenue (e.g., park fees, visas) and indirect benefits (e.g., hospitality, transport). Assuming a 10% tax or fee on tourism receipts (a conservative estimate based on VAT and park fees), USD 3,842.6 million could yield ~USD 384.3 million for reinvestment, equivalent to TZS 1,031.3 billion at TZS 2,684.41/USD (previous responses).
2. Limited Human Capital Investment
   • Current Allocation: Human capital development, particularly education and health, receives 19.9% of Tanzania’s USD 35,505.9 million external debt (previous responses), equivalent to ~USD 7,065.7 million, supporting initiatives like free secondary education and health infrastructure. However, development expenditure in March 2025 was TZS 1,406.7 billion (41.7% of total expenditure), with only a portion allocated to human capital, as recurrent spending (TZS 1,968.4 billion, 58.3%) dominates for wages and debt servicing (previous responses).
   • Human Capital Gaps: Tanzania’s Human Capital Index (HCI) is 0.40, below the Sub-Saharan Africa average of 0.48, indicating that a child born today will achieve only 40% of their potential productivity. Education challenges include low secondary completion rates (30% in 2023) and teacher shortages, while health faces issues like high maternal mortality (556 per 100,000 births). TICGL note underfunding, with health and education budgets at 7% and 15% of the 2024/25 budget.
   • Impact on Growth: Limited human capital investment constrains inclusive growth, as low skills reduce labor productivity in sectors like agriculture (26% of GDP) and manufacturing (9%). The Monthey Economic Review emphasizes human capital for Vision 2025 goals, requiring increased funding to meet 8% GDP growth by 2026.
3. Economic Diversification Challenges
   • Over-Reliance on Tourism: Tourism’s 56.0% share of services receipts and ~10% of GDP highlights over-reliance, with other services (e.g., ICT, financial) contributing only 8.8% (USD 653.6 million, previous responses). Goods exports like gold (USD 3,369.7 million, 36.8% of goods exports) are also volatile due to global price fluctuations. The Monthey Economic Review notes agricultural export growth (5.1% of external debt use, previous responses), but its contribution remains limited.
   • Diversification Needs: Reducing reliance on tourism requires developing sectors like manufacturing, ICT, and agriculture, which need skilled labor. TICGL advocate for industrialization under the African Continental Free Trade Agreement (AfCFTA, ratified 2022), but only 6% of firms train workers formally. The current account deficit (USD 2,224.9 million) underscores the need for diversified exports to stabilize external balances (previous responses).
   • Role of Human Capital: Investing tourism revenues in education and health can build a skilled workforce for diversified sectors, reducing volatility risks. For example, vocational training in ICT could support digital economy growth (mobile money transactions up 26.73%), while health improvements enhance labor productivity across sectors.

Strategies to Reinvest Tourism Revenues into Human Capital

1. Earmark Tourism Taxes for Education and Health
   • Action: Allocate 10% of tourism receipts (USD 384.3 million, TZS 1,031.3 billion) as a dedicated fund for human capital, split equally between education (TZS 515.65 billion) and health (TZS 515.65 billion). This could finance teacher training (e.g., 10,000 new teachers at TZS 10 million/year, costing TZS 100 billion) and health facilities (e.g., 50 new clinics at TZS 8 billion each, costing TZS 400 billion).
   • Impact: This would increase education and health budgets by ~3% each (based on 2024/25 budget of TZS 49.35 trillion), improving secondary completion rates and reducing maternal mortality, aligning with the World Bank’s Country Partnership Framework (2025–2029). It could cover ~36.7% of March 2025’s development expenditure (1,031.3 / 1,406.7 × 100, previous responses).
2. Establish Public-Private Partnerships (PPPs) for Vocational Training
   • Action: Partner with tourism operators (e.g., Serena Hotels) to fund vocational training centers, using 5% of receipts (USD 192.1 million, TZS 515.6 billion) to train 100,000 youth annually in skills like hospitality, ICT, and agribusiness (costing TZS 5 million per trainee, TZS 500 billion total). PPPs could leverage private expertise and infrastructure.
   • Impact: This would increase formal training (currently 6% of firms), supporting diversification into manufacturing (3.9% of external debt use) and ICT (8.8% of services receipts). Trained workers could boost GDP by 1–2% annually, as seen in Rwanda’s vocational programs, reducing tourism reliance.
3. Community-Based Tourism Training Programs
   • Action: Use 3% of receipts (USD 115.3 million, TZS 309.4 billion) to fund community-based programs training locals near tourist sites (e.g., Serengeti, Zanzibar) in guiding, crafts, and sustainable tourism. Training 50,000 locals at TZS 6 million each (TZS 300 billion) could create jobs and retain revenue locally.
   • Impact: This would enhance inclusive growth, as 70% of tourism jobs are low-skill and local, reducing poverty (26.4% in 2022). It aligns with the Monthey Economic Review’s focus on job creation and could generate TZS 50–100 billion in local revenue annually.
4. Invest in Health Infrastructure for Tourism Regions
   • Action: Allocate 2% of receipts (USD 76.9 million, TZS 206.3 billion) to build health facilities in tourism hubs, ensuring quality care for visitors and locals. Constructing 20 hospitals at TZS 10 billion each (TZS 200 billion) would improve health outcomes and tourism resilience.
   • Impact: This would reduce health-related risks to tourism (e.g., disease outbreaks), supporting 19.5% GDP contribution by 2025/26. Improved health enhances labor productivity, critical for diversification into agriculture (26% of GDP).

Conclusion

Tanzania’s tourism sector, with a record 2,162,487 arrivals in April 2025 generating USD 3,842.6 million (56.0% of services receipts), offers significant potential to fund human capital development, critical for inclusive growth and reducing reliance on volatile sectors. Key issues include tourism’s vulnerability to shocks, underinvestment in education and health (19.9% of USD 35.51 billion external debt), and limited economic diversification. Reinvesting ~20% of receipts (USD 768.6 million, TZS 2,062.6 billion) through earmarked taxes, PPPs, community training, and health infrastructure could enhance skills, reduce poverty, and diversify into sectors like ICT and manufacturing. These strategies align with Vision 2025’s 8% growth goal and, supported by a stable current account deficit (USD 2,224.9 million) and reserves (USD 5.3 billion), can ensure sustainable development. The following table summarizes these key figures.

In March 2025, Tanzania’s government budgetary operations showcased robust fiscal performance, with total revenue of TZS 3,090.8 billion, falling 3.1% short of the TZS 3,190 billion target due to non-tax revenue underperformance (TZS 350.5 billion vs. TZS 522.4 billion). Tax revenue excelled at TZS 2,603.3 billion, 2% above target, driven by strong income tax collections (11.6% above target). Total expenditure reached TZS 3,375.1 billion, with 58.3% (TZS 1,968.4 billion) allocated to recurrent costs and 41.7% (TZS 1,406.7 billion) to development projects, resulting in a modest deficit of TZS 284.3 billion. The following table summarizes these key figures.

1. Central Government Revenues – March 2025

Central government revenues are critical for financing public expenditure and achieving fiscal objectives. The data for March 2025 highlights strong tax revenue performance despite a shortfall in total collections.

Key Figures:

• Total Revenue Collected: TZS 3,090.8 billion
  • Performance vs. Target: 3.1% below the target of ~TZS 3,190 billion (calculated as 3,090.8 / 0.969 ≈ 3,190).
• Breakdown of Revenues:

• Key Tax Revenue Component:
  • Income tax exceeded its target by 11.6%, indicating robust collection efforts.

Analysis:

• Overall Revenue Performance: The total revenue of TZS 3,090.8 billion, while 3.1% below the target, reflects strong fiscal discipline, particularly in tax collection. The Monthly Economic Review notes sustained tax administration initiatives (e.g., February 2025 revenue of TZS 2,697.8 billion, 98.3% of target,), suggesting that March’s 96.9% performance continues a trend of near-target collections. The shortfall is primarily due to non-tax revenue underperforming at TZS 350.5 billion against a target of TZS 522.4 billion (67.1% of target, calculated as 350.5 / 522.4 × 100).
• Tax Revenue Strength: The tax revenue of TZS 2,603.3 billion, 2% above target, aligns with TICGL indicating improved tax collection efficiency, with the tax-to-GDP ratio rising to 11.8% in 2022/23 (). The strong performance of income tax (11.6% above target) likely reflects enhanced compliance and economic activity, supported by a projected GDP growth of 5.4%–6.0% in 2025 (,).
• Non-tax Revenue Shortfall: Non-tax revenue (e.g., licenses, fees, dividends) at TZS 350.5 billion fell short of the TZS 522.4 billion target, a 32.9% underperformance. This could be due to lower-than-expected dividends from public enterprises or reduced fees, possibly linked to seasonal factors or administrative inefficiencies. The Monthly Economic Review does not specify non-tax revenue details but notes the use of Electronic Fiscal Devices (EFDs) to improve revenue administration, which may have been less effective for non-tax TICGL.

Interpretation:

• The strong tax revenue performance (2% above target) indicates effective tax administration, likely driven by initiatives like EFDs and a focus on progressive taxes (e.g., income tax, VAT) as recommended by the World Bank (). The 11.6% outperformance in income tax suggests robust private sector activity, consistent with a 13.2% growth in private sector credit in February 2025.
• The non-tax revenue shortfall (TZS 350.5 billion vs. TZS 522.4 billion) highlights a need for improved collection mechanisms for fees and dividends, as non-tax revenue is a smaller but critical component (11.3% of total revenue, calculated as 350.5 / 3,090.8 × 100).
• The overall revenue collection of TZS 3,090.8 billion supports the government’s fiscal target of raising domestic revenue to 15.8% of GDP in 2024/25 (), contributing to fiscal sustainability.

Source Context:

• TICGL confirm Tanzania’s focus on expanding the tax base, with domestic revenue projected at TZS 34.61 trillion (15.7% of GDP) for 2024/25 (). The March 2025 tax revenue performance aligns with this trajectory, though non-tax revenue challenges persist, as seen in earlier reports (e.g., TZS 347.8 billion in February 2025 vs. a target of TZS 413.9 billion).

2. Central Government Expenditures – March 2025

Expenditures reflect the government’s priorities in operational costs and development projects, critical for economic growth and public service delivery.

Key Figures:

• Total Expenditure: TZS 3,375.1 billion
• Expenditure Breakdown:

• Proportions:
  • Recurrent expenditure: 58.3% of total (1,968.4 / 3,375.1 × 100).
  • Development expenditure: 41.7% of total (1,406.7 / 3,375.1 × 100).

Analysis:

• Recurrent Expenditure: At TZS 1,968.4 billion, recurrent spending (wages, interest, and other operational costs) constitutes the majority of expenditure. Wages and salaries (~TZS 833.3 billion) reflect significant public sector employment costs, consistent with the 35.1% minimum wage increase announced for July 2025. Interest payments (~TZS 300.0 billion) align with debt servicing obligations, as Tanzania’s external debt stood at USD 32.89 billion in September 2024. Other recurrent spending (~TZS 835.1 billion) likely includes administrative costs and social services, such as health and education, which are priorities in the 2024/25 budget.
• Development Expenditure: At TZS 1,406.7 billion, development spending (41.7% of total) emphasizes infrastructure and social projects, such as the Standard Gauge Railway (SGR), Julius Nyerere Hydropower Project, and health initiatives. This aligns with the Monthly Economic Review’s focus on flagship projects (e.g., food stock management) and the 2024/25 budget’s allocation of TZS 16.4 trillion for development.
• Fiscal Discipline: The close alignment of expenditure (TZS 3,375.1 billion) with revenue (TZS 3,090.8 billion) indicates disciplined fiscal management, as the deficit is relatively modest (see below). The Monthly Economic Review notes a fiscal deficit target below 3% of GDP, supported by TICGL projecting a 2.5% deficit in 2024/25.

Interpretation:

• The 58.3% share of recurrent expenditure reflects ongoing operational needs, particularly wages and debt servicing, which are critical for maintaining public sector stability. The Monthly Economic Review’s stable CBR at 6% supports manageable interest payments.
• The 41.7% share for development expenditure highlights Tanzania’s commitment to infrastructure and human capital, aligning with the Third Five-Year Development Plan (2021/22–2025/26) goals of 8% GDP growth by 2026 and job creation.
• The balance between recurrent and development spending supports inclusive growth, as noted in the World Bank’s focus on enhancing human capital and private sector-led growth.

3. Revenue vs. Expenditure Snapshot and Budget Deficit

The comparison between revenue and expenditure provides insight into fiscal balance and financing needs.

Key Figures:

• Revenue: TZS 3,090.8 billion
• Expenditure: TZS 3,375.1 billion
• Budget Deficit: ~TZS 284.3 billion (3,375.1 - 3,090.8)
• Comparison: March 2024 vs. March 2025:

Analysis:

• Budget Deficit: The deficit of TZS 284.3 billion (approximately 8.4% of expenditure, calculated as 284.3 / 3,375.1 × 100) indicates a financing gap, likely covered by domestic borrowing (e.g., Treasury bills and bonds, as seen in the Government Securities Market with TZS 519.6 billion in successful bond bids, previous responses) or external borrowing (e.g., IMF’s USD 440.8 million under the ECF,). The Monthey Economic Review notes the use of domestic and external borrowing to finance deficits.
• Year-on-Year Trends:
  • Revenue Decline: Total revenue fell from ~TZS 3,279.6 billion in March 2024 to TZS 3,090.8 billion in March 2025 (down 5.8%), driven by a 6.4% drop in non-tax revenue (374.3 to 350.5 billion). Tax revenue, however, increased by 2% (2,553.2 to 2,603.3 billion), reflecting improved tax administration.
  • Expenditure Increase: Total expenditure rose slightly from ~TZS 3,349.0 billion to TZS 3,375.1 billion (up 0.8%), with development expenditure growing significantly by 10.4% (1,274.8 to 1,406.7 billion), underscoring infrastructure priorities.
• Fiscal Context: The Monthly Economic Review highlights a fiscal deficit target below 3% of GDP, and TICGL note a projected 2.5% deficit in 2024/25 (). The March 2025 deficit of TZS 284.3 billion is modest relative to the 2024/25 budget of TZS 49.35 trillion (), suggesting fiscal prudence.

Interpretation:

• The increase in tax revenue (2% above target) and development expenditure (10.4% year-on-year growth) reflects alignment with the 2024/25 budget priorities of infrastructure and human capital development.
• The non-tax revenue shortfall and slight revenue decline indicate challenges in diversifying revenue TICGL, as noted in the World Bank’s call for broadening the tax base.
• The modest deficit suggests effective fiscal management, supported by strong domestic revenue mobilization (15.7% of GDP in 2024/25,) and external financing options.

Conclusion

In March 2025, Tanzania’s government budgetary operations demonstrated robust fiscal performance, with tax revenue (TZS 2,603.3 billion) exceeding targets by 2%, driven by a strong income tax performance (11.6% above target). Total revenue of TZS 3,090.8 billion fell 3.1% short of the TZS 3,190 billion target due to non-tax revenue underperformance (TZS 350.5 billion vs. TZS 522.4 billion). Expenditure of TZS 3,375.1 billion was balanced between recurrent (58.3%, TZS 1,968.4 billion) and development spending (41.7%, TZS 1,406.7 billion), reflecting priorities in wages, debt servicing, and infrastructure. The resulting TZS 284.3 billion deficit indicates fiscal discipline, likely financed through domestic securities or external loans, aligning with the Monthly Economic Review’s stable macroeconomic framework (inflation at 3.2%, CBR at 6%).

The following table summarizes these key figures.

In April 2025, Tanzania’s banking sector exhibited stable yet dynamic interest rate trends, reflecting a competitive financial environment. The overall lending rate eased to 15.16% from 15.50% in March 2025, enhancing credit access, while the short-term lending rate rose slightly to 16.15%, indicating cautious short-term lending. Deposit rates showed mixed trends, with the 12-month deposit rate increasing to 9.27% from 8.14%, incentivizing long-term savings, and negotiated deposit rates rising to 10.52%. The interest rate spread narrowed to 6.88% from 7.72% a year earlier, signaling improved banking efficiency. The following table summarizes these key figures.

1. Lending Interest Rates (April 2025)

Lending interest rates reflect the cost of borrowing from commercial banks, influencing credit access for businesses and individuals. The provided data shows a stable yet slightly easing lending environment.

Key Figures:

Analysis:

• Overall Lending Rate: The decline from 15.50% in March 2025 to 15.16% in April 2025 (a 0.34 percentage point drop) indicates a marginal easing of borrowing costs. This aligns with the stable Central Bank Rate (CBR) of 6% maintained by the Bank of Tanzania (BoT) in April 2025 (Monthey Economic Review), suggesting a cautious monetary policy to support economic growth while managing inflation (3.2% in April 2025). Compared to April 2024 (15.51%), the rate is down by 0.35 percentage points, reflecting a gradual trend toward lower borrowing costs.
• Short-term Lending Rate: The increase from 15.83% in March 2025 to 16.15% in April 2025 (up 0.32 percentage points) suggests banks are charging slightly more for loans with maturities up to one year. This could reflect higher perceived risk or demand for short-term credit, possibly linked to seasonal economic activities (e.g., agricultural trade, as food stocks rose to 557,228 tonnes). Compared to April 2024 (16.17%), the rate is nearly stable, with a minor decrease of 0.02 percentage points.
• Negotiated Lending Rate: The slight decline from 12.94% in March 2025 to 12.88% in April 2025 (down 0.06 percentage points) and a more significant drop from 13.46% in April 2024 (down 0.58 percentage points) indicates that prime or large borrowers (e.g., corporations or institutional clients) benefit from more favorable terms. This aligns with TICGL noting negotiated rates for prime borrowers averaging around 12.77%–12.79% in late suggesting continued flexibility for high-value clients.

Insights:

• The slight decline in the overall lending rate to 15.16% suggests improved access to credit, supporting economic activities like investment and consumption. The Monthey Economic Review notes a projected GDP growth of 6% in 2025, which may be bolstered by these lower borrowing costs.
• The rise in short-term lending rates to 16.15% could indicate banks’ caution in extending short-term credit, possibly due to seasonal liquidity demands or minor risk concerns, despite stable macroeconomic conditions (inflation at 3.2%).
• The lower negotiated rates (12.88%) reflect banks’ willingness to offer competitive terms to prime borrowers, likely to support key sectors like manufacturing or trade, as noted in the diversified loan portfolio.

Source Context:

• TICGL indicate that lending rates have been relatively stable, with November 2024 rates at 15.67% overall and 12.77% negotiated, consistent with the April 2025 trend of gradual declines. Historical data shows lending rates at 16.68% in 2020, suggesting a long-term downward trend from higher historical averages (19.78% from 1992–2020).

2. Deposit Interest Rates (April 2025)

Deposit interest rates reflect the returns offered by banks to attract savings, influencing liquidity and consumer behavior.

Key Figures:

Analysis:

• Savings Deposit Rate: The slight increase from 2.86% in March 2025 to 2.89% in April 2025 (up 0.03 percentage points) and from 2.70% in April 2024 (up 0.19 percentage points) suggests banks are marginally increasing incentives for savings accounts. This aligns with TICGL noting a rise in savings deposit rates to 3.02% in August 2024, indicating a trend of encouraging household savings.
• Overall Time Deposit Rate: The decline from 8.00% in March 2025 to 7.82% in April 2025 (down 0.18 percentage points) but an increase from 7.55% in April 2024 (up 0.27 percentage points) reflects a mixed trend. The monthly decline suggests eased liquidity pressure, as banks may have sufficient deposits, consistent with the Monthey Economic Review’s indication of high liquidity in the banking sector (evidenced by Government Securities Market oversubscription, previous responses).
• 12-month Deposit Rate: The significant rise from 8.14% in March 2025 to 9.27% in April 2025 (up 1.13 percentage points) and from 8.94% in April 2024 (up 0.33 percentage points) indicates banks are offering higher returns for longer-term deposits to lock in funds. This contrasts with TICGL noting a decline to 8.18% overall deposit rates in November 2024, suggesting a strategic shift toward long-term deposits by April 2025.
• Negotiated Deposit Rate: The increase from 10.35% in March 2025 to 10.52% in April 2025 (up 0.17 percentage points) and from 9.59% in April 2024 (up 0.93 percentage points) shows banks are competing for large or institutional deposits. This aligns with TICGL reporting negotiated deposit rates at 10.14% in November 2024, indicating a continued upward trend.

Insights:

• The rise in savings (2.89%) and 12-month deposit rates (9.27%) suggests banks are incentivizing long-term savings, possibly to support lending activities or manage liquidity, as deposits are a primary funding source.
• The decline in overall time deposit rates to 7.82% reflects ample liquidity, reducing the need to aggressively attract deposits, consistent with the Monthey Economic Review’s note of high banking sector liquidity (e.g., TZS 2,611.1 billion in Interbank Cash Market transactions, previous responses).
• Higher negotiated deposit rates (10.52%) indicate competition for large depositors, likely institutional clients or pension funds, which hold significant domestic debt (26.5% by pension funds).

Source Context:

• TICGL confirm a trend of rising deposit rates, with January 2025 rates at 10.08%, up from a historical average of 9.12% (2016–2025). The April 2025 negotiated rate of 10.52% continues this upward trend, reflecting banks’ efforts to attract deposits amid strong credit demand.

3. Interest Rate Spread

The interest rate spread, defined as the difference between lending and deposit rates, indicates banking sector efficiency and credit risk perceptions.

Key Figures:

• Short-term Interest Rate Spread:
  • April 2025: 6.88 percentage points
  • April 2024: 7.72 percentage points
  • Change: Decrease of 0.84 percentage points

Analysis:

• Declining Spread: The reduction from 7.72% in April 2024 to 6.88% in April 2025 indicates a more competitive and efficient banking system. This aligns with TICGL noting a narrowing spread to 5.93% in November 2024, suggesting continued improvement. The spread is calculated as the difference between the short-term lending rate (16.15%) and a corresponding deposit rate (e.g., 12-month deposit rate of 9.27%), yielding 6.88 percentage points.
• Implications: A narrower spread suggests lower credit risk perceptions and increased competition, as banks charge less of a premium on loans while offering better returns to depositors. This is supported by the Monthey Economic Review’s stable macroeconomic environment (inflation at 3.2%, CBR at 6%) and TICGL noting reduced credit risk.
• Context: The document’s indication of high liquidity in the Government Securities Market (e.g., TZS 1,076.7 billion in bond bids, previous responses) and Interbank Cash Market (TZS 2,611.1 billion) supports efficient liquidity management, contributing to the narrower spread.

Source Context:

• TICGL confirm a trend of narrowing spreads, with August 2024 at 6.68% and November 2024 at 5.93%, reflecting improved banking efficiency. The April 2025 spread of 6.88% is slightly higher but consistent with this trend.

Conclusion

In April 2025, Tanzania’s lending and deposit interest rates reflected a stable and competitive financial sector. The overall lending rate eased to 15.16%, benefiting borrowers, while short-term rates rose slightly to 16.15%, indicating caution in short-term lending. Negotiated lending rates (12.88%) favored prime borrowers. Deposit rates showed mixed trends, with savings (2.89%) and 12-month rates (9.27%) rising, incentivizing long-term savings, while overall time deposit rates fell to 7.82%, reflecting ample liquidity. The interest rate spread narrowed to 6.88% from 7.72%, signaling improved efficiency and reduced credit risk. These trends align with the Monthey Economic Review’s stable monetary policy (CBR at 6%) and moderate inflation (3.2%), supporting economic growth projected at 6% in 2025. The following table summarizes these key figures.

The table is designed to present the data clearly and concisely, including comparisons with March 2025 and April 2024, as well as the interest rate spread, wrapped in an artifact tag as per the guidelines.

In April 2025, Tanzania's financial markets demonstrated robust activity, reflecting strong investor confidence and effective liquidity management. The Government Securities Market saw significant oversubscription, with Treasury bill bids reaching TZS 275 billion against a tender size of TZS 218 billion and Treasury bond bids totaling TZS 1,076.7 billion against TZS 481.7 billion, driven by declining yields (e.g., Treasury bills at 8.86%, down from 10.10%). The Interbank Cash Market recorded a 48.5% surge in transaction volume to TZS 2,611.1 billion, with a stable interest rate of 8.00%, supporting efficient liquidity redistribution among banks. The following table summarizes these key figures.

1. Government Securities Market

The Government Securities Market in Tanzania, encompassing Treasury bills and bonds, is a critical component of public debt financing and monetary policy implementation. The data you provided for April 2025 highlights strong investor confidence, high liquidity, and favorable macroeconomic conditions.

Key Figures and Details:

• Treasury Bills:
  • Number of Auctions: 2 auctions were conducted in April 2025.
  • Total Tender Size: TZS 218 billion, representing the amount offered by the government.
  • Total Bids Received: TZS 275 billion, indicating oversubscription (bids exceeded the tender size by approximately 26.15%, calculated as [(275 - 218) / 218] × 100).
  • Successful Bids: TZS 208.2 billion, meaning 95.5% of the tender size was successfully allocated (208.2 / 218 × 100).
  • Weighted Average Yield (WAY): Decreased to 8.86% in April 2025 from 10.10% in March 2025, a reduction of 1.24 percentage points.
• Treasury Bonds:
  • Types Offered: 2-year, 10-year, and 20-year bonds.
  • Total Tender Size: TZS 481.7 billion.
  • Total Bids Received: TZS 1,076.7 billion, reflecting significant oversubscription (bids were 2.24 times the tender size, calculated as 1,076.7 / 481.7).
  • Successful Bids: TZS 519.6 billion, indicating that 107.8% of the tender size was allocated (519.6 / 481.7 × 100), suggesting the government accepted slightly more than the offered amount, likely due to favorable bid terms.
  • Bond Yields:
    • 2-year bond: Yield decreased to 12.08% (specific prior yield not provided, but a decline is noted).
    • 10-year bond: Yield slightly increased to 14.26%.
    • 20-year bond: Yield decreased to 15.11%.
• Implications of Oversubscription:
  • High Liquidity in the Banking Sector: The significant oversubscription (TZS 275 billion vs. TZS 218 billion for Treasury bills and TZS 1,076.7 billion vs. TZS 481.7 billion for bonds) indicates that banks and other investors had ample liquidity to invest in government securities.
  • Stable Macroeconomic Conditions: The document notes moderate headline inflation at 3.2% in April 2025 and a stable Central Bank Rate (CBR) at 6%, which likely contributed to a predictable investment environment, encouraging participation in auctions.
  • Rising Investor Confidence: The high bid-to-tender ratios and declining yields for Treasury bills and most bonds suggest strong demand for government securities, reflecting confidence in Tanzania’s fiscal and monetary stability.

Analysis and Contextual Insights:

• Yield Trends:
  • The decline in the weighted average yield for Treasury bills (from 10.10% to 8.86%) aligns with the document’s indication of easing inflationary pressures (e.g., core inflation dropped to 2.2% from 3.9% year-on-year). Lower yields suggest reduced risk perceptions and strong demand, as investors are willing to accept lower returns for secure government securities.
  • The mixed yield movements for bonds (decreases for 2-year and 20-year, slight increase for 10-year) reflect varying investor expectations across maturities. The slight increase in the 10-year bond yield to 14.26% may indicate some market anticipation of longer-term risks, possibly related to global economic uncertainties mentioned in the document (e.g., a projected global growth slowdown to 2.8% in 2025).
• Monetary Policy Link: The document explains that the Bank of Tanzania uses the discount rate, based on Treasury bill rates plus a loaded factor, to manage liquidity. The decline in Treasury bill yields to 8.86% suggests that the discount rate may also have remained stable or decreased, supporting the CBR’s maintenance at 6% to ensure inflation stays within the 5% medium-term target.
• Lombard Facility: The banks can pledge government securities for overnight loans via the Lombard facility. The high subscription rates for both Treasury bills and bonds indicate that banks likely hold significant portfolios of these securities, enhancing their ability to access central bank liquidity when needed.
• Public Debt Financing: The document defines public debt as including domestic debt to finance fiscal deficits. The successful bids (TZS 208.2 billion for bills and TZS 519.6 billion for bonds) demonstrate the government’s ability to raise substantial funds domestically, reducing reliance on external debt (noted as a component of national debt).

2. Interbank Cash Market (IBCM)

The Interbank Cash Market facilitates short-term lending and borrowing among banks, enabling efficient liquidity management. The data provided for April 2025 shows increased activity and stable interest rates.

Key Figures and Details:

• Total Transactions:
  • April 2025: TZS 2,611.1 billion, a significant increase from TZS 1,757.7 billion in March 2025, representing a 48.5% rise (calculated as [(2,611.1 - 1,757.7) / 1,757.7] × 100).
• Share of Transactions:
  • 7-day Deals: 40.7% of total transactions, indicating a preference for slightly longer-term liquidity management.
  • Overnight Deals: 15.2%, reflecting the use of the shortest-term loans for immediate liquidity needs.
• Overall IBCM Interest Rate:
  • Decreased slightly to 8.00% in April 2025 from 8.12% in March 2025, a reduction of 0.12 percentage points.
• Implications:
  • Active Liquidity Redistribution: The 48.5% increase in transaction volume suggests banks were actively managing liquidity, likely due to increased economic activity or seasonal demands (e.g., supporting agricultural trade, as food stocks increased to 557,228 tonnes).
  • Stable Interest Rates: The slight decline in the IBCM interest rate to 8.00% aligns with the stable CBR at 6%, indicating that interbank rates remained within the Bank of Tanzania’s target band, ensuring monetary policy effectiveness.

Analysis and Contextual Insights:

• Monetary Policy Framework: The document outlines that the Bank of Tanzania uses the CBR to influence money supply and interbank rates. The stable CBR at 6% and the slight decline in IBCM rates to 8.00% suggest effective monetary policy transmission, maintaining rates within a target band conducive to economic growth and price stability (inflation target of 5%).
• Repos and Reverse Repos: The defines repurchase agreements (repos) and reverse repos as tools used by the Bank of Tanzania to manage liquidity in the interbank market. The high transaction volume (TZS 2,611.1 billion) likely includes repo transactions, which facilitate short-term liquidity adjustments using government securities as collateral.
• Liquidity Dynamics: The document’s mention of the Lombard facility, where banks can borrow overnight from the central bank, complements the IBCM by providing an alternative liquidity source. The increased IBCM transaction volume suggests banks preferred interbank lending over central bank facilities, possibly due to favorable rates or sufficient market liquidity.
• Economic Context: The increase in food stocks and the release of 29,834 tonnes of maize by the National Food Reserve Agency indicate government spending to stabilize food prices, which may have increased liquidity needs in the banking sector. The IBCM’s robust activity (TZS 2,611.1 billion) reflects banks’ ability to redistribute this liquidity efficiently.

Conclusion

In April 2025, Tanzania’s financial markets demonstrated robustness:

• Government Securities Market: The market saw strong demand, with Treasury bills oversubscribed (TZS 275 billion bids vs. TZS 218 billion tender) and bonds significantly oversubscribed (TZS 1,076.7 billion bids vs. TZS 481.7 billion tender). Declining yields for Treasury bills (8.86%) and most bonds (2-year: 12.08%, 20-year: 15.11%) reflect high liquidity and investor confidence, supported by stable macroeconomic conditions (3.2% inflation, 6% CBR).
• Interbank Cash Market: Transaction volumes surged to TZS 2,611.1 billion from TZS 1,757.7 billion, with 7-day deals (40.7%) and overnight deals (15.2%) driving activity. The slight decline in interest rates to 8.00% indicates effective liquidity management within the Bank of Tanzania’s target band.

The table is designed to present the data clearly and concisely, focusing on the metrics you highlighted for both markets. Since the request is to develop a table with key figures.

Tanzania’s affordable cost of living, with 2025 monthly expenses of 1,240,012.4 TSh for a single person and 4,293,375 TSh for a family of four (excluding rent), alongside low rents like 1,039,418.93 TSh for a city-center 1-bedroom apartment, offers a strong foundation for economic development by 2030. These cost advantages can attract investment, boost tourism, and spur entrepreneurship. However, the significant affordability gap, where the average monthly net salary of 693,333.33 TSh falls short of these costs, threatens living standards and widens income disparities. By implementing targeted policies, such as wage increases, childcare subsidies, and infrastructure investments, Tanzania can bridge this gap to achieve inclusive and sustainable economic growth by 2030.

1. Capitalizing on Affordable Cost of Living for Economic Development by 2030

Tanzania’s low cost of living in 2025 provides a competitive advantage that can drive economic development by 2030 through strategic initiatives in investment, tourism, and entrepreneurship:

• Attracting Foreign Investment and Remote Workers:
  Affordable living costs, such as 1,039,418.93 TSh for a city-center 1-bedroom apartment (range: 300,000–2,685,704 TSh) and 454,074.67 TSh outside city centers, position Tanzania as an attractive destination for foreign businesses and digital nomads by 2030. For instance, a tech startup could house employees at low costs, with utilities for an 85m² apartment averaging 168,125 TSh (range: 63,750–300,000 TSh). Scaling up foreign direct investment (FDI) in sectors like technology and manufacturing can create high-paying jobs, boosting economic growth.
  Example: By 2030, a remote worker earning a global salary could live on 1,694,087.07 TSh (single-person costs 1,240,012.4 TSh + rent 454,074.67 TSh), with surplus income fueling local economies through spending on services like dining (6,500 TSh per meal).
• Boosting Tourism and Hospitality:
  Low dining and leisure costs, such as 6,500 TSh for an inexpensive meal (range: 3,000–15,000 TSh) and 12,000 TSh for a cinema ticket (range: 10,000–25,000 TSh), make Tanzania a compelling tourist destination. Affordable transportation, with a one-way ticket at 725 TSh (range: 600–2,000 TSh), enhances access to sites like Zanzibar and Serengeti. By 2030, investments in tourism infrastructure (e.g., hotels, transport networks) can significantly increase foreign exchange earnings, contributing to GDP growth.
  Example: A tourist spending 50,000 TSh on a mid-range meal for two and 45,000 TSh on a monthly transport pass generates consistent revenue for local businesses, supporting job creation.
• Fostering Entrepreneurship:
  Low operational costs, including groceries (e.g., 2,700 TSh/kg for rice, 2,408.33 TSh/kg for bananas) and utilities (27,928.57 TSh for a mobile plan with 10GB+ data), enable entrepreneurs to launch ventures with minimal capital. By 2030, supporting micro-enterprises like food stalls or retail through low-cost inputs can drive economic diversification. For instance, a food stall sourcing 10kg of rice for 27,000 TSh and 5kg of chicken for 67,000 TSh keeps startup costs low.
  Example: A small business with monthly costs of 200,000 TSh (groceries, utilities, transport) can scale profitably in urban markets, contributing to local economic resilience.

2. Addressing the Affordability Gap by 2030

The average monthly net salary of 693,333.33 TSh in 2025 falls significantly below the estimated costs of 1,240,012.4 TSh for a single person (shortfall: 546,679.07 TSh) and 4,293,375 TSh for a family of four (shortfall: 3,600,041.67 TSh with one earner, 2,906,708.34 TSh with two earners). Including rent exacerbates this gap:

• Single Person: Total costs with rent outside city centers (1,240,012.4 TSh + 454,074.67 TSh = 1,694,087.07 TSh) result in a shortfall of 1,000,753.74 TSh.
• Family of Four: Total costs with a 3-bedroom apartment outside city centers (4,293,375 TSh + 934,804.40 TSh = 5,228,179.40 TSh) result in a shortfall of 4,534,846.07 TSh (one earner) or 3,841,512.74 TSh (two earners).

This gap limits purchasing power, lowers living standards, and widens income inequality, as only high earners can afford premium services like international schools (23,750,000 TSh/year). By 2030, addressing this gap is critical to ensuring inclusive growth.

3. Policy Recommendations to Reduce Income Disparities and Enhance Living Standards by 2030

To bridge the affordability gap and achieve sustainable economic growth by 2030, Tanzania can implement the following policies:

• Increase Minimum Wages and Job Creation:
  Gradually raising the minimum wage to approach 1,240,012.4 TSh for singles or promoting dual-income households (e.g., two earners at 693,333.33 TSh = 1,386,666.66 TSh) can reduce the shortfall. By 2030, investments in high-growth sectors like manufacturing and tourism can create jobs paying above the current average, such as 1,000,000 TSh for factory workers, enabling singles to cover living costs.
  Impact: Reducing the 546,679.07 TSh shortfall for singles increases disposable income, boosting spending on non-essentials like 42,500 TSh for jeans or 158,571.43 TSh for a fitness club, stimulating retail growth.
• Subsidize Childcare and Education:
  High childcare costs, such as 756,250 TSh/month for preschool (range: 375,000–1,300,000 TSh), burden families. By 2030, government subsidies or public preschool programs could lower costs to 200,000 TSh/month, freeing up 556,250 TSh for families. This would enhance labor force participation, particularly for women, and build human capital for a skilled workforce.
  Impact: Reducing childcare costs lowers the family shortfall from 3,600,041.67 TSh to 2,843,791.67 TSh, improving affordability and supporting economic productivity.
• Improve Infrastructure for Cost Efficiency:
  Expanding affordable transportation (e.g., maintaining 725 TSh one-way tickets) and utilities (168,125 TSh for an 85m² apartment) can lower living costs by 2030. For example, reliable electricity could reduce utility bills to 100,000 TSh, saving 68,125 TSh/month. Affordable internet (98,222.22 TSh for 60 Mbps) can support remote work, increasing income opportunities.
  Impact: Lowering utility costs by 68,125 TSh reduces the single-person shortfall to 478,554.07 TSh, enhancing affordability and economic participation.
• Promote Affordable Housing:
  By 2030, subsidizing rentals (e.g., capping 1-bedroom apartments at 300,000 TSh in city centers) or reducing mortgage rates (current: 14.6%, range: 10–25%) to 5% for apartments at 2,500,000 TSh/m² outside city centers can improve housing access. This encourages homeownership and wealth accumulation.
  Impact: Reducing rent to 300,000 TSh lowers single-person total costs to 1,540,012.4 TSh, cutting the shortfall to 846,679.07 TSh.

4. Economic Development Outcomes by 2030

By leveraging low costs and addressing income disparities by 2030:

• Increased Consumer Spending: Reducing the shortfall boosts spending on non-essentials (e.g., 15,000 TSh for a bottle of wine, 77,500 TSh for Nike shoes), driving growth in retail and service sectors.
• Human Capital Growth: Affordable childcare and education enhance workforce skills, supporting industries like technology and tourism, critical for long-term GDP growth.
• Sustainable Growth: Attracting FDI and tourism, combined with higher wages, can reduce the 14.6% mortgage rate and expand housing markets, fostering economic resilience and inclusivity.

The table retains the key economic figures from research data, including the average monthly net salary (693,333.33 TSh), living costs (1,240,012.4 TSh for singles, 4,293,375 TSh for families), housing (1,039,418.93 TSh for city-center 1-bedroom rent), and other expenses like groceries (2,700 TSh/kg for rice), transport (725 TSh one-way ticket), utilities (168,125 TSh), and childcare (756,250 TSh/month). The "Notes" column is revised to emphasize long-term economic implications and opportunities for 2030, highlighting affordability advantages and challenges like income disparities.

Tanzania, a vibrant East African nation known for its cultural diversity and natural beauty, offers a relatively affordable cost of living compared to Western countries, making it an appealing destination for residents and expatriates alike. However, for the average Tanzania earning a monthly net salary of 693,333.33 TSh (Tanzania Shillings), managing daily expenses can be challenging. According to recent data, the estimated monthly costs, excluding rent, are 1,240,012.40 TSh for a single person and 4,293,375.00 TSh for a family of four, representing 178.8% and 619.2% of the average salary, respectively. Rent further strains budgets, with a one-bedroom apartment outside city centers averaging 454,074.67 TSh (65.5% of the salary) and a three-bedroom apartment at 934,804.40 TSh (134.9% of the salary). While Tanzania’s cost of living is 54.1% lower than in the United States and rent is 80.6% lower, the disparity between local income and expenses highlights the need for careful budgeting, particularly for families. This introduction sets the stage for a detailed analysis of how key living costs—such as food, housing, transportation, and childcare—impact the financial realities of Tanzanias as of June 2025.

Cost of Living in Tanzania in Relation to Average Income

Understanding the cost of living in Tanzania, particularly in the context of the average monthly income, is essential for assessing the financial realities faced by Tanzanias. This analysis uses collected data to present a clear picture of living expenses across various categories, with a specific focus on how these costs align with the average monthly net salary of 693,333.33 TSh (Tanzania Shillings).

All figures are in TSh, and the analysis reflects conditions as of June 2025. The goal is to provide a realistic perspective on affordability for the average Tanzania, supported by detailed figures.

Overview of Cost of Living and Income

The cost of living in Tanzania is significantly lower than in the United States, with overall expenses 54.1% lower and rent 80.6% lower. The estimated monthly costs, excluding rent, are:

• Single Person: 1,240,012.4 TSh
• Family of Four: 4,293,375.0 TSh

However, the average monthly net salary (after tax) is 693,333.33 TSh, which poses challenges for covering these expenses, especially for single-income households or families. Below, we break down key cost categories and analyze their affordability relative to this income level.

1. Food and Dining Costs

Food expenses, including dining out and groceries, are a significant part of monthly budgets. Here’s how they compare to the average salary:

• Restaurants:
  • Inexpensive Meal: 6,500 TSh (range: 3,000–15,000 TSh)
  • Mid-range Restaurant (Three-Course Meal for Two): 50,000 TSh (range: 30,000–120,000 TSh)
  • Cappuccino: 4,969.82 TSh (range: 2,000–7,500 TSh)
  • Coke/Pepsi (0.33-liter): 944.12 TSh (range: 700–1,500 TSh)
• Markets:
  • Milk (1 liter): 2,442.11 TSh (range: 1,500–4,000 TSh)
  • Loaf of Bread (500g): 2,028.12 TSh (range: 1,000–3,500 TSh)
  • Rice (1kg): 2,700 TSh (range: 2,000–3,500 TSh)
  • Eggs (12): 5,336.47 TSh (range: 3,600–8,400 TSh)
  • Chicken Fillets (1kg): 13,400 TSh (range: 6,000–18,000 TSh)
  • Bananas (1kg): 2,408.33 TSh (range: 1,500–5,000 TSh)

Affordability Analysis:

• A single person eating out occasionally (e.g., 5 inexpensive meals per month) would spend 32,500 TSh (5 × 6,500). For groceries, a basic weekly shopping list (1kg rice, 1 liter milk, 12 eggs, 1kg bananas) costs approximately 12,886.91 TSh, or 51,547.64 TSh monthly.
• Total food cost for a single person: ~84,047.64 TSh (12.1% of the average salary).
• For a family of four, grocery costs could quadruple (e.g., 206,190.56 TSh), and occasional dining out (e.g., one mid-range meal for two adults monthly) adds 50,000 TSh, totaling ~256,190.56 TSh (36.9% of the average salary).
• Conclusion: Food is relatively affordable for singles, but families face a significant burden, consuming over a third of the average income.

2. Housing Costs (Rent)

Housing is one of the most affordable aspects of living in Tanzania compared to Western standards, but it remains a challenge relative to local income.

• 1-Bedroom Apartment in City Centre: 1,039,418.93 TSh (range: 300,000–2,685,704 TSh)
• 1-Bedroom Apartment Outside City Centre: 454,074.67 TSh (range: 250,000–1,000,000 TSh)
• 3-Bedroom Apartment in City Centre: 1,985,841.16 TSh (range: 537,140.80–4,834,267.20 TSh)
• 3-Bedroom Apartment Outside City Centre: 934,804.40 TSh (range: 300,000–2,685,704 TSh)

Affordability Analysis:

• A single person renting a 1-bedroom apartment outside the city centre spends 454,074.67 TSh, which is 65.5% of the average salary (693,333.33 TSh). Opting for the lower end of the range (250,000 TSh) reduces this to 36.1%.
• A family of four renting a 3-bedroom apartment outside the city centre spends 934,804.40 TSh, or 134.9% of the average salary, making it unaffordable for a single-income household. Even at the lower end (300,000 TSh), it’s 43.3% of the salary.
• Conclusion: Rent is a major expense, especially for families. Singles can manage with budget options, but families likely require dual incomes or cheaper housing options.

3. Transportation Costs

Transportation options include public transport, taxis, and personal vehicles, with costs varying by mode.

• One-way Ticket (Local Transport): 725 TSh (range: 600–2,000 TSh)
• Monthly Pass (Regular Price): 45,000 TSh (range: 21,739.13–52,000 TSh)
• Taxi Start (Normal Tariff): 3,750 TSh (range: 3,750–5,000 TSh)
• Taxi 1km (Normal Tariff): 4,000 TSh (range: 3,000–5,000 TSh)
• Gasoline (1 liter): 3,107.78 TSh (range: 2,900–3,300 TSh)

Affordability Analysis:

• A single person using public transport (monthly pass) spends 45,000 TSh, or 6.5% of the average salary. Alternatively, 20 one-way tickets monthly (e.g., for work) cost 14,500 TSh (20 × 725), or 2.1% of the salary.
• A family might rely on taxis for occasional trips. A 5km taxi ride costs 23,750 TSh (3,750 + 5 × 4,000). Two such trips weekly total 190,000 TSh monthly, or 27.4% of the salary.
• Conclusion: Public transport is highly affordable, but reliance on taxis significantly increases costs, especially for families.

4. Utilities and Connectivity

Utilities and communication are essential expenses that add to the monthly budget.

• Basic Utilities (85m² Apartment): 168,125 TSh (range: 63,750–300,000 TSh)
• Mobile Phone Plan (Calls + 10GB Data): 27,928.57 TSh (range: 10,000–50,000 TSh)
• Internet (60 Mbps, Unlimited Data): 98,222.22 TSh (range: 60,000–150,000 TSh)

Affordability Analysis:

• For a single person, basic utilities (at the lower end, 63,750 TSh) and a mobile plan (27,928.57 TSh) total 91,678.57 TSh, or 13.2% of the average salary. Adding internet (98,222.22 TSh) increases this to 189,900.79 TSh, or 27.4%.
• A family in an 85m² apartment might pay the average 168,125 TSh for utilities, plus two mobile plans (55,857.14 TSh) and internet (98,222.22 TSh), totaling 322,204.36 TSh, or 46.5% of the salary.
• Conclusion: Utilities are a significant expense, particularly for families, and can consume nearly half the average salary when including internet.

5. Other Essential Costs

Additional expenses like childcare, clothing, and leisure impact affordability, especially for families.

• Childcare:
  • Preschool (Monthly): 756,250 TSh (range: 375,000–1,300,000 TSh)
• Clothing:
  • 1 Pair of Jeans: 42,500 TSh (range: 20,000–60,000 TSh)
  • 1 Pair of Nike Shoes: 77,500 TSh (range: 45,000–100,000 TSh)
• Leisure:
  • Cinema (1 Seat): 12,000 TSh (range: 10,000–25,000 TSh)
  • Fitness Club (Monthly): 158,571.43 TSh (range: 55,000–250,000 TSh)

Affordability Analysis:

• A single person might spend 42,500 TSh on clothing annually (e.g., one pair of jeans) and 12,000 TSh monthly on leisure (e.g., one cinema visit), totaling 15,750 TSh monthly (assuming clothing is amortized over 12 months). This is 2.3% of the salary.
• A family with one child in preschool (756,250 TSh) faces a massive expense, equivalent to 109.1% of the average salary, making it unaffordable without additional income.
• Conclusion: Childcare is prohibitively expensive, while clothing and leisure are manageable for singles but add up for families.

Budget Scenarios Relative to Average Salary

Single Person

• Food: 84,047.64 TSh (groceries + occasional dining)
• Rent (1-Bedroom, Outside City Centre): 454,074.67 TSh (average) or 250,000 TSh (low-end)
• Transportation (Monthly Pass): 45,000 TSh
• Utilities (Basic + Mobile): 91,678.57 TSh
• Total (Average Rent): 674,800.21 TSh (~97.4% of 693,333.33 TSh)
• Total (Low-end Rent): 470,726.21 TSh (~67.9% of salary)

Analysis: A single person can live modestly within the average salary by choosing low-end rent and minimizing discretionary spending (e.g., avoiding internet or frequent dining). However, there’s little room for savings or unexpected expenses.

Family of Four (Single Income)

• Food: 256,190.56 TSh
• Rent (3-Bedroom, Outside City Centre): 934,804.40 TSh (average) or 300,000 TSh (low-end)
• Transportation (Two Monthly Passes): 90,000 TSh
• Utilities (Basic + Two Mobile Plans + Internet): 322,204.36 TSh
• Childcare (One Child in Preschool): 756,250 TSh
• Total (Average Rent): 2,359,449.36 TSh (340.3% of salary)
• Total (Low-end Rent): 1,724,644.96 TSh (248.8% of salary)

Analysis: A single income of 693,333.33 TSh is insufficient for a family of four, especially with childcare costs. Dual incomes or significantly reduced expenses (e.g., no preschool, cheaper housing) are necessary.

Key Insights and Challenges

1. Low Income Relative to Costs: The average salary (693,333.33 TSh) barely covers the estimated monthly costs for a single person (1,240,012.4 TSh, excluding rent) and is far inadequate for a family of four (4,293,375 TSh, excluding rent). This highlights a significant affordability gap.
2. Housing and Childcare as Major Burdens: Rent and childcare are the largest expenses. For families, preschool costs alone can exceed the average salary, making quality education inaccessible for many.
3. Affordable Basics: Food (especially groceries) and public transportation are relatively affordable, allowing budget-conscious individuals to manage these costs within the average salary.
4. Need for Multiple Incomes: Families relying on a single income face severe financial strain. Dual incomes or informal income sources (e.g., small businesses) are likely common among Tanzanias to bridge the gap.
5. Limited Savings Potential: With basic expenses consuming most of the average salary, saving for emergencies, education, or homeownership (with high mortgage rates of 14.6%) is challenging.

Conclusion

The cost of living in Tanzania is low compared to Western standards, but the average monthly net salary of 693,333.33 TSh makes it difficult for many Tanzanias to afford a comfortable lifestyle, especially for families. Singles can manage by opting for budget housing, public transport, and minimal discretionary spending, but families face significant challenges, particularly with childcare and rent. To improve financial stability, Tanzanias may need to pursue higher-paying jobs, multiple income streams, or cost-saving strategies like living in less expensive areas or relying on local markets. This analysis underscores the importance of aligning expenses with income and highlights the economic realities faced by the average Tanzania.

Key Cost of Living Figures in Tanzania Relative to Average Salary

Below is a table summarizing key cost of living figures in Tanzania, with a focus on their affordability relative to the average monthly net salary of 693,333.33 TSh (Tanzania Shillings). The table includes average costs, ranges, and the percentage of the average salary each item represents, providing a clear picture of financial realities for Tanzanias as of June 2025.

Notes:

• Costs are in Tanzania Shillings (TSh) and reflect averages and ranges from the provided document.
• The percentage of average salary is calculated as (Average Cost ÷ 693,333.33) × 100.
• Key insights:
  • The monthly cost for a single person (excl. rent) exceeds the average salary by 78.8%, and for a family of four, it’s over 6 times the salary.
  • Rent and childcare are particularly burdensome, with preschool costs alone exceeding the average salary.
  • Affordable categories include public transport (e.g., 0.1% per one-way ticket) and basic groceries (e.g., 0.3–0.4% per kg of rice or bananas).
• Data reflects conditions as of June 2025.

The Tanzania Investment Centre (TIC) Quarterly Bulletin for January to March 2025 (Q3 2024/25) reports a significant 46.72% increase in capital inflow compared to the same period in the previous year (Q3 2023/24), with total capital attracted reaching USD 2,164.7 million compared to USD 1,475.43 million in Q3 2023/24. This growth, coupled with the registration of 199 investment projects expected to generate 24,444 jobs, underscores Tanzania’s robust economic development trajectory. Below, TICGL analyze the sectors driving this capital increase, supported by figures from the document, and explain how they contribute to economic diversification, a critical factor in reducing reliance on traditional sectors and fostering sustainable growth.

Sectors Driving the Capital Inflow Growth

The bulletin highlights notable increases in capital, project numbers, and job opportunities in specific sectors during Q3 2024/25, The key sectors driving the 46.72% capital increase include:

1. Agriculture:
   • Capital Increase: The bulletin notes a “notable increase” in capital in the agriculture sector, though exact capital figures per sector are not provided in the text. However, the sector’s prominence is evident from the number of projects and jobs.
   • Projects and Jobs: Agriculture saw an increase in registered projects and job opportunities. For context, the document highlights specific agricultural projects like the Bugwema Irrigation Scheme (USD 14.89 million, 2,500+ household jobs) and the Usariver Agricultural SEZ, indicating significant investment interest.
   • Figure Reference: Figure 4.2 shows a rise in the number of agricultural projects and jobs compared to Q3 2023/24, suggesting a substantial contribution to the capital inflow.
2. Energy:
   • Capital Increase: The energy sector recorded a significant increase in capital, driven by projects like solar and clean energy initiatives (e.g., inbound missions from China and India focusing on energy).
   • Projects and Jobs: The sector also saw an increase in registered projects and job creation. Figure likely reflects this growth in project numbers.
   • Example Projects: Missions from Japan (energy, February 13, 2025) and India (clean energy, March 28, 2025) indicate targeted investments.
3. Economic Infrastructure:
   • Capital Increase: This sector experienced a notable rise in capital, likely driven by projects like the East Africa Commercial & Logistics Center (EACLC) with an investment exceeding USD 200 million and infrastructure-focused missions (e.g., UAE’s logistics hub interest).
   • Projects and Jobs: The bulletin notes an increase in project numbers and jobs, with Figure 4.2 illustrating this trend.
   • Significance: The EACLC, with its 75,000 square meters and four functional areas (commercial trading, logistics, business district, leisure), is a flagship project enhancing Tanzania’s role as a regional trade hub.
4. Services:
   • Capital Increase: The services sector, encompassing tourism, real estate, and other services, also contributed to the capital surge. Inbound missions from Japan (real estate, February 2025) and Poland (tourism, January 16, 2025) highlight this focus.
   • Projects and Jobs: Figure shows growth in service-related projects and jobs, reflecting investments in tourism and hospitality.
5. Manufacturing:
   • Capital Increase: Despite a slight decrease in the number of projects, the manufacturing sector recorded a 45.87% increase in capital, making it a significant driver of the overall 46.72% capital growth.
   • Projects and Jobs: Figure indicates a slight dip in project numbers but a substantial increase in capital, suggesting larger-scale investments. Examples include Chinese investments in motorcycle assembly, tire manufacturing, and steel production.
   • Specific Investments: The bulletin lists 19 inbound missions from China alone, many focusing on manufacturing sectors like tea processing, building materials, and stainless steel.

Quantitative Breakdown

• Total Capital (Q3 2024/25): USD 2,164.7 million.
• Previous Year (Q3 2023/24): USD 1,475.43 million.
• Increase in Capital: USD 2,164.7M – USD 1,475.43M = USD 689.27 million, equivalent to a 46.72% increase.
• Projects Registered: 199 projects (94 foreign-owned, 66 locally owned, 39 joint ventures).
• Jobs Created: 24,444 jobs.
• Expansion Projects: 9 projects with USD 100.09 million in capital and 1,542 jobs.
• Sectoral Contribution:
  • Agriculture, Energy, Economic Infrastructure, and Services: Increased in projects, jobs, and capital.
  • Manufacturing: 45.87% capital increase, despite fewer projects.

Contribution to Economic Diversification

Economic diversification reduces Tanzania’s reliance on traditional sectors like agriculture and mining, fostering resilience and sustainable growth. The sectors driving the capital inflow contribute to diversification as follows:

1. Agriculture:
   • Diversification Impact: Investments like the Bugwema Irrigation Scheme (USD 14.89 million) and the Usariver Agricultural SEZ modernize agriculture, shifting from subsistence to commercial farming. The Usariver project focuses on horticulture for export, enhancing foreign exchange earnings.
   • Economic Benefits: These projects create over 2,500 household jobs (Bugwema) and boost food security, reducing dependence on rain-fed agriculture. The allocation of 30,000 hectares in Mkulazi for the “Mkulazi Agricultural City” (USD 570 million) supports large-scale agribusiness, diversifying agricultural output.
   • Figure Impact: The increase in agricultural projects supports value-added activities like processing, reducing reliance on raw commodity exports.
2. Energy:
   • Diversification Impact: Investments in solar and clean energy (e.g., Chinese solar project) reduce dependence on traditional energy sources like hydropower, enhancing energy security.
   • Economic Benefits: Energy projects support industrial growth by ensuring reliable power for manufacturing and infrastructure projects like the EACLC. This enables Tanzania to attract more industries, diversifying from agriculture-based revenue.
   • Figure Impact: The rise in energy sector capital reflects investments in renewable energy, aligning with global sustainability trends.
3. Economic Infrastructure:
   • Diversification Impact: The EACLC (USD 200 million+) integrates wholesale, logistics, warehousing, and e-commerce, positioning Tanzania as a regional trade hub. The Standard Gauge Railway (SGR) in Morogoro enhances trade connectivity, opening markets for diverse sectors like horticulture and manufacturing.
   • Economic Benefits: The EACLC is expected to create jobs and boost trade across East Africa, while the SGR supports faster transport of perishable goods, diversifying market access. These projects reduce reliance on traditional trade routes and ports.
   • Figure Impact: Figure shows 73 projects in Dar es Salaam, where EACLC is located, indicating infrastructure’s role in capital attraction.
4. Services:
   • Diversification Impact: Investments in tourism and real estate (e.g., Japanese and Polish missions) diversify Tanzania’s economy by capitalizing on its tourism potential and urban development needs.
   • Economic Benefits: Tourism projects create jobs and foreign exchange, while real estate investments (supported by the 2023 Land Policy) stimulate construction and housing markets, broadening economic activity.
   • Figure Impact: Figure shows increased service sector projects, reflecting growth in non-traditional sectors.
5. Manufacturing:
   • Diversification Impact: The 45.87% capital increase in manufacturing supports industrial growth in areas like tea processing, motorcycle assembly, and steel production. This shifts Tanzania from raw material exports to value-added manufacturing.
   • Economic Benefits: Manufacturing projects create high-skill jobs (e.g., 1,542 jobs from expansion projects) and increase export revenues. The Kibaha Textile SEZ (USD 78.85 million, 38,400 jobs) exemplifies large-scale industrial diversification.
   • Figure Impact: Figure highlights manufacturing’s capital growth, underscoring its role in economic transformation.

Broader Economic Development Impact

• Job Creation: The 24,444 jobs across these sectors reduce unemployment and increase household incomes, boosting domestic consumption and tax revenues.
• FDI and Domestic Investment: The 62.5% increase in joint ventures (39 projects) indicates growing local participation, fostering inclusive growth. Figure shows 94 foreign-owned and 66 locally owned projects, balancing FDI and domestic investment.
• Regional Distribution: Figure shows Dar es Salaam (73 projects), Pwani (48), and Arusha (16), ensuring economic activity spreads beyond urban centers, promoting balanced development.
• Policy Support: The Tanzania Investment and Special Economic Zones Authority Act and the 2023 Land Policy create a conducive environment, encouraging diverse investments. The EACLC’s alignment with the Belt & Road Initiative enhances global trade linkages.

Conclusion

The 46.72% increase in capital inflow to USD 2,164.7 million in Q3 2024/25 was driven by agriculture, energy, economic infrastructure, services, and manufacturing, as evidenced by Figure and specific project data. These sectors contribute to economic diversification by modernizing agriculture, enhancing energy security, improving trade infrastructure, expanding service industries, and boosting manufacturing. Projects like the EACLC (USD 200 million+), Kibaha Textile SEZ (USD 78.85 million), and Bugwema Irrigation Scheme (USD 14.89 million) exemplify this shift, creating jobs, increasing exports, and reducing reliance on traditional sectors. These investments, supported by reforms like TISEZA and the 2023 Land Policy, position Tanzania as a diversified, resilient economy and a leading investment destination in Africa.

This table will provide a clear, concise overview of the figures that illustrate Tanzania’s economic development during Q3 2024/25, as requested, with an emphasis on the 46.72% capital inflow increase and other key metrics.

Explanation of the Table

This table captures key figures from the bulletin that highlight Tanzania’s economic development in Q3 2024/25, focusing on investment, job creation, and sectoral contributions. Figures contribute to economic development:

• Capital Inflow (USD 2,164.7 million, 46.72% increase): Reflects strong investor confidence, driven by agriculture, energy, infrastructure, services, and manufacturing. This supports economic growth by increasing available capital for development projects.
• Projects and Jobs (199 projects, 24,444 jobs): The high number of projects and jobs boosts employment, household incomes, and tax revenues, fostering inclusive growth.
• Sectoral Growth: Manufacturing’s 45.87% capital increase and projects like the EACLC (USD 200 million+) and Kibaha Textile SEZ (USD 78.85 million) drive industrial and trade diversification.
• Agricultural Investments: Projects like Bugwema (USD 14.89 million) and Mkulazi (USD 570 million) modernize agriculture, enhancing food security and exports.
• Regional Balance: The distribution of projects across Dar es Salaam, Pwani, and Arusha promotes equitable economic development.
• 2024 Achievements: The record 901 projects and 212,293 jobs highlight a landmark year, driven by reforms like the Investment Act 2022 and the National Investment Campaign.

The "Tanzania Investment Centre Quarterly Bulletin January to March 2025" highlights a remarkable 71% increase in registered investment projects from 2023 to 2024, with the number of projects rising from 526 in 2023 to 901 in 2024. This surge, described as making 2024 the "best year ever" for investment in Tanzania since the TIC’s establishment in 1997, has significantly driven economic growth by boosting job creation, increasing capital inflows, and fostering sectoral diversification. Below, TICGL analyze the impact on economic growth, focusing on job creation and capital inflow, using figures from the bulletin.

1. Job Creation

The 71% increase in registered projects has led to a record-breaking number of jobs, significantly contributing to Tanzania’s economic growth by enhancing employment, household incomes, and domestic consumption.

• Total Jobs Created in 2024: The 901 registered projects in 2024 are expected to generate 212,293 jobs, a substantial increase compared to previous years, though specific job figures for 2023 are not provided in the document. This number is described as the highest in TIC’s history, underscoring the scale of employment impact.
• Q3 2024/25 Specifics: In Q3 2024/25 alone, 199 projects were registered, expected to create 24,444 jobs. This includes 9 expansion projects generating 1,542 jobs, indicating that the momentum from 2024’s project surge continued into the third quarter.
• Sectoral Job Contributions:
  • Manufacturing: Despite a slight decrease in project numbers, manufacturing saw a 45.87% increase in capital, contributing high-skill jobs. The Kibaha Textile Special Economic Zone (SEZ) alone is expected to create 38,400 jobs with a capital investment of USD 78.85 million.
  • Agriculture: Projects like the Bugwema Irrigation Scheme (USD 14.89 million) are projected to create over 2,500 household jobs, while the Mkulazi Agricultural City (USD 570 million, 30,000 hectares) supports large-scale job creation.
  • Economic Infrastructure: The East Africa Commercial & Logistics Center (EACLC) in Ubungo, Dar es Salaam (USD 200 million+), is expected to create numerous jobs across trade, logistics, and services.
• Economic Impact: The creation of 212,293 jobs in 2024 reduces unemployment, increases household purchasing power, and boosts tax revenues, which fuel public investments in infrastructure and services. For context, Tanzania’s GDP growth is partly driven by increased labor force participation, with employment in diverse sectors like manufacturing and agriculture reducing reliance on informal jobs. The bulletin’s emphasis on projects like the Vikapu Bomba initiative, empowering over 300 rural women in Iringa and Njombe, highlights inclusive growth, further amplifying economic benefits.

2. Capital Inflow

The 71% increase in projects has significantly boosted capital inflows, providing the financial resources needed for infrastructure, industrial expansion, and economic diversification.

• Capital Inflow in Q3 2024/25: The bulletin reports a 46.72% increase in capital inflow in Q3 2024/25, reaching USD 2,164.7 million compared to USD 1,475.43 million in Q3 2023/24, an absolute increase of USD 689.27 million. While this figure is specific to Q3, it reflects the broader trend of increased investment activity driven by the 901 projects registered in 2024.
• Domestic Investment Surge: Domestic projects increased by 74%, from 182 in 2023 to 321 in 2024, spurred by the National Investment Campaign and a reduced investment threshold of USD 50,000 for domestic investors. This contributed significantly to capital inflows, as locally owned projects (66 in Q3 2024/25) and joint ventures (39, up 62.5% from 24 in Q3 2023/24) added to the capital pool.
• Foreign Direct Investment (FDI): The bulletin notes 94 foreign-owned projects in Q3 2024/25, supported by 73 inbound missions from countries like China, India, and Japan. For example, Chinese investments in manufacturing (e.g., motorcycle assembly, tea processing) and India’s focus on clean energy have driven significant capital inflows.
• Key Projects:
  • EACLC: Over USD 200 million invested in a logistics and trade hub, positioning Tanzania as a regional trade leader.
  • Mkulazi Agricultural City: USD 570 million for agricultural modernization.
  • Kibaha Textile SEZ: USD 78.85 million for industrial growth.
  • Expansion Projects: USD 100.09 million for 9 expansion projects in Q3 2024/25.
• Economic Impact: The increased capital inflow supports infrastructure development, such as the Standard Gauge Railway (SGR) in Morogoro, which enhances trade connectivity, and digital platforms like the Tanzania Electronic Investment Window (TeIW), which streamlines investment processes. These investments drive GDP growth by funding productive sectors, with the 46.72% capital increase signaling Tanzania’s attractiveness as an investment destination.

3. Broader Economic Growth Impacts

• Sectoral Diversification: The 901 projects span agriculture, manufacturing, energy, infrastructure, and services, reducing reliance on traditional sectors like mining. For instance, manufacturing’s 45.87% capital increase and agriculture’s modernization through projects like Usariver SEZ diversify Tanzania’s economic base, enhancing resilience.
• Regional Development: Figure shows 73 projects in Dar es Salaam, 48 in Pwani, and 16 in Arusha, promoting balanced growth across regions. The new TIC office in Njombe further decentralizes investment services, boosting regional economies.
• Policy Reforms: The Tanzania Investment and Special Economic Zones Authority Act (2025) and the 2023 Land Policy have facilitated the project surge by improving the investment climate. The lower domestic investment threshold (USD 50,000) and land access for non-citizens have attracted both local and foreign capital.
• Global Integration: Participation in the Belt & Road Initiative via projects like the EACLC and events like the Tanzania-Japan Trade and Investment Forum enhance Tanzania’s role in global trade, driving export-led growth.

Conclusion

The 71% increase in registered investment projects from 526 in 2023 to 901 in 2024 has profoundly impacted Tanzania’s economic growth by creating 212,293 jobs and driving a 46.72% capital inflow increase to USD 2,164.7 million in Q3 2024/25. Job creation has reduced unemployment, increased household incomes, and stimulated consumption, while capital inflows have funded transformative projects like the EACLC (USD 200 million+), Kibaha Textile SEZ (USD 78.85 million), and Mkulazi Agricultural City (USD 570 million). These investments, supported by reforms like the 2023 Land Policy and TISEZA Act, have diversified Tanzania’s economy across agriculture, manufacturing, and infrastructure, positioning it as a regional economic powerhouse. The regional spread of projects and inclusive initiatives like Vikapu Bomba further ensure equitable growth, enhancing Tanzania’s economic resilience and global competitiveness.

The "Tanzania Investment Centre Quarterly Bulletin January to March 2025" reports that in Q3 2024/25, Dar es Salaam attracted 73 projects, Pwani 48 projects, and Arusha 16 projects, as part of the 199 total investment projects registered nationwide. This distribution, with significant investments in both urban and less urbanized regions, contributes to balanced economic development across Tanzania by promoting job creation, capital inflow, infrastructure development, and sectoral diversification in multiple regions. Below, TICGL analyze how this regional spread fosters equitable economic growth, using figures from the bulletin.

1. Overview of Regional Investment Distribution

• Total Projects in Q3 2024/25: 199 projects, generating USD 2,164.7 million in capital inflow (46.72% increase from USD 1,475.43 million in Q3 2023/24) and 24,444 jobs.
• Key Regions (Page 21, Figure 4.4):
  • Dar es Salaam: 73 projects (36.7% of total projects).
  • Pwani: 48 projects (24.1% of total projects).
  • Arusha: 16 projects (8.0% of total projects).
  • Other Regions: The remaining 62 projects (31.2%) are distributed across other regions, though specific counts for other regions are not detailed in the text but implied in Figure.
• Investment Types: The 199 projects include 94 foreign-owned, 66 locally owned, and 39 joint ventures, indicating diverse investment sources across regions.

This distribution shows a concentration in Dar es Salaam, the economic hub, but also significant activity in Pwani and Arusha, suggesting efforts to spread economic opportunities beyond the capital.

2. Contribution to Balanced Economic Development

Balanced economic development involves reducing regional disparities, ensuring equitable access to economic opportunities, and fostering growth in both urban and rural areas. The distribution of projects in Dar es Salaam, Pwani, and Arusha contributes to this goal as follows:

a. Dar es Salaam (73 Projects)

• Economic Role: As Tanzania’s commercial capital, Dar es Salaam is a hub for trade, logistics, and services. Its 73 projects reflect its attractiveness to investors due to infrastructure like the Dar es Salaam Port and urban markets.
• Key Projects and Figures:
  • East Africa Commercial & Logistics Center (EACLC): Investment exceeding USD 200 million, creating jobs in trade, logistics, and services. The EACLC, with 75,000 square meters, enhances Tanzania’s role as a regional trade hub.
  • Capital Contribution: Dar es Salaam’s high project count likely accounts for a significant portion of the USD 2,164.7 million capital inflow, though region-specific capital is not isolated in the document.
  • Job Creation: The 73 projects contribute substantially to the 24,444 jobs in Q3 2024/25. For example, service and manufacturing projects in Dar es Salaam, such as those from Chinese investors (e.g., motorcycle assembly), create high-skill jobs.
• Impact on Balanced Development:
  • Dar es Salaam’s investments drive national economic growth by attracting foreign direct investment (FDI) and supporting infrastructure like the EACLC, which benefits other regions through improved trade networks.
  • The concentration of projects ensures economies of scale in the urban center, generating tax revenues that can be redistributed to less developed regions.
  • However, over-reliance on Dar es Salaam could exacerbate urban-rural disparities, making investments in other regions critical for balance.

b. Pwani (48 Projects)

• Economic Role: Pwani, a coastal region near Dar es Salaam, is emerging as an industrial and agricultural hub, benefiting from proximity to the port and infrastructure like the Standard Gauge Railway (SGR).
• Key Projects and Figures:
  • Kibaha Textile Special Economic Zone (SEZ): Investment of USD 78.85 million, expected to create 38,400 jobs. This project boosts textile manufacturing and exports.
  • Agricultural Investments: Pwani’s projects include agricultural initiatives, contributing to the sector’s increased project numbers and jobs.
  • Job Contribution: Pwani’s 48 projects significantly add to the 24,444 jobs, with the Kibaha SEZ alone accounting for a substantial share.
• Impact on Balanced Development:
  • Pwani’s high project count (second only to Dar es Salaam) indicates growing investment in a semi-urban region, reducing pressure on Dar es Salaam and spreading economic activity.
  • The Kibaha SEZ creates thousands of jobs, particularly for local communities, enhancing household incomes and reducing regional poverty.
  • Investments in Pwani strengthen regional connectivity, as the SGR and port access facilitate trade, benefiting neighboring regions like Morogoro.

c. Arusha (16 Projects)

• Economic Role: Arusha, a northern region, is a tourism and agricultural hub, known for its proximity to national parks and horticulture potential.
• Key Projects and Figures:
  • Usariver Agricultural SEZ: A 209-acre project focused on horticulture, aimed at boosting export earnings. While specific capital figures are not provided, it aligns with agriculture’s increased capital in Q3 2024/25.
  • Tourism Investments: Arusha’s projects include service sector investments, supported by inbound missions like Poland’s tourism focus (January 16, 2025).
  • Job Contribution: Arusha’s 16 projects contribute to the 24,444 jobs, with tourism and agriculture creating both direct and indirect employment.
• Impact on Balanced Development:
  • Arusha’s investments promote economic activity in a non-coastal, northern region, reducing geographic disparities.
  • The Usariver SEZ enhances export-oriented agriculture, increasing foreign exchange earnings and supporting rural economies.
  • Tourism projects leverage Arusha’s natural assets, creating jobs for local communities and fostering sustainable growth.

d. Other Regions

• Distribution: The remaining 62 projects (31.2% of 199) are spread across other regions, though specific regions are not detailed. Examples include:
  • Morogoro: Benefits from the SGR and projects like the Mkulazi Agricultural City (USD 570 million, 30,000 hectares).
  • Njombe: Supported by a new TIC office serving the Nyasa Zone and initiatives like Vikapu Bomba, empowering 300+ rural women.
  • Geita: Hosts projects like the Lech Company Limited honey processing initiative.
• Impact on Balanced Development:
  • Investments in regions like Morogoro and Njombe ensure rural areas benefit from economic growth, addressing urban-rural disparities.
  • The TIC office in Njombe decentralizes investment services, making it easier for investors to operate in southern regions, fostering regional equity.
  • Small-scale projects like Vikapu Bomba and Lech Company enhance inclusive growth, particularly for women and rural communities.

3. Mechanisms Supporting Balanced Development

• Policy Reforms: The Tanzania Investment and Special Economic Zones Authority Act (2025) and the 2023 Land Policy facilitate investments across regions by improving land access and streamlining permits. The Tanzania Electronic Investment Window (TeIW) ensures equitable access to investment processes nationwide.
• Infrastructure Connectivity: The SGR and EACLC (Page 3) connect Dar es Salaam, Pwani, and Morogoro, enabling other regions to benefit from urban investments through improved trade routes.
• Regional TIC Offices: The Njombe office and plans for further decentralization bring investment services closer to rural investors, encouraging projects in underserved areas.
• Sectoral Diversification: Figure shows increased projects in agriculture, manufacturing, and services across regions, ensuring diverse economic activities. For example, Pwani’s manufacturing (Kibaha SEZ) and Arusha’s agriculture (Usariver SEZ) complement Dar es Salaam’s trade focus.

4. Quantitative Impact

• Capital Inflow: The USD 2,164.7 million in Q3 2024/25 is distributed across regions, with Dar es Salaam’s 73 projects likely attracting the largest share due to projects like the EACLC (USD 200 million+). Pwani’s 48 projects, including Kibaha SEZ (USD 78.85 million), and Arusha’s 16 projects add to this total.
• Job Creation: The 24,444 jobs are spread across regions, with Pwani’s Kibaha SEZ (38,400 jobs) and Arusha’s Usariver SEZ contributing significantly. Dar es Salaam’s service and manufacturing projects further boost employment.
• Project Distribution: The 73, 48, and 16 projects in Dar es Salaam, Pwani, and Arusha, respectively, account for 68.8% of the 199 projects, with the remaining 31.2% ensuring other regions are not neglected.
• Annual Context: In 2024, 901 projects created 212,293 jobs, with regional distribution (e.g., Morogoro, Njombe) amplifying the impact of Q3’s 199 projects.

5. Challenges and Opportunities

• Challenges: Dar es Salaam’s dominance (36.7% of projects) could lead to urban congestion, requiring more incentives for rural investments. Regions with fewer projects (e.g., beyond the top three) need targeted promotion.
• Opportunities: The TIC’s regional expansion and projects like Mkulazi in Morogoro can further balance growth. Inclusive initiatives like Vikapu Bomba ensure marginalized groups benefit, enhancing social equity.

Conclusion

The regional distribution of 73 projects in Dar es Salaam, 48 in Pwani, and 16 in Arusha in Q3 2024/25, alongside 62 projects in other regions, contributes to balanced economic development by spreading investment, jobs, and infrastructure across Tanzania. Dar es Salaam’s EACLC (USD 200 million+) drives national trade, Pwani’s Kibaha SEZ (USD 78.85 million, 38,400 jobs) boosts industrial growth, and Arusha’s Usariver SEZ enhances agricultural exports. Other regions like Morogoro (Mkulazi, USD 570 million) and Njombe (Vikapu Bomba, 300+ women) ensure rural inclusion. Supported by reforms like the TISEZA Act and infrastructure like the SGR, this distribution reduces regional disparities, creates 24,444 jobs, and leverages USD 2,164.7 million in capital, fostering equitable and sustainable economic growth across Tanzania.

The Chama Cha Mapinduzi (CCM) Manifesto for the 2025 General Election, launched on May 30, 2025, aims to transform Tanzania’s economy by 2030 through ambitious targets like creating 350,000 jobs in Zanzibar, constructing a 1,108-km Tanga–Arusha–Musoma railway, and boosting per capita income. Building on past successes, such as a 44% increase in irrigated farmland (681,383 to 983,466 hectares) from 2020–2024 and 304 investment projects worth USD 3.74 billion in Zanzibar from 2015–2020, the manifesto leverages Tanzania’s 5.3% GDP growth in 2023 and projected 6% in 2025. However, with public debt at 41.1% of GDP in 2024 and ambiguous targets like 300,000 units for the blue economy, its realism hinges on addressing funding gaps and structural challenges to achieve inclusive growth.

1. Overview of the CCM Manifesto 2025–2030

The CCM Manifesto, launched on May 30, 2025, outlines nine strategic priorities, including economic transformation, job creation, infrastructure development, and inclusive growth. Key economic targets include:

• Creating 350,000 new jobs in Zanzibar by 2030.
• Increasing per capita income in Zanzibar (in USD, not quantified) and enhancing trade and industrial contributions to GDP.
• Promoting investment through infrastructure projects like the 1,108-km Tanga–Arusha–Musoma railway and Bagamoyo port.
• Advancing the blue economy in Zanzibar, targeting a contribution of 300,000 units (jobs or output, unclear) by 2030.
• Training 2,500 cooperative societies in Zanzibar to boost productivity.
• Providing affordable loans, such as two cows per youth annually in Zanzibar.

These targets build on the 2020–2025 manifesto’s achievements, such as increasing irrigated farmland from 681,383 to 983,466 hectares (+44%) and food security from 114% to 128%. The manifesto aligns with NDV 2050’s goal of achieving a USD 1 trillion GDP and USD 12,000 per capita GDP by 2050, requiring over 8% annual growth.

2. Current Economic Situation (as of May 31, 2025)

Tanzania’s economy is a lower-middle-income economy with a GDP per capita of USD 1,149 in 2024. Key economic indicators include:

• GDP Growth: Real GDP grew by 5.3% in 2023, driven by agriculture, construction, and manufacturing, and is projected at 5.6%–5.7% for 2024 and 6% for 2025. Zanzibar’s GDP growth was stronger at 7% in 2024 and is projected at 6.8% in 2025.
• Inflation: Inflation remained low at 3.8% in 2023, projected to decline to 3.3% in 2024 and rise slightly to 3.4% in 2025, supported by stable food and energy prices. In March 2025, inflation was 3.3%, with food inflation at 5.4%.
• Public Debt: Public debt is at 41.1% of GDP in 2024, posing a moderate risk, with foreign exchange shortages noted as a challenge to growth.
• FDI and Trade: Foreign direct investment (FDI) is growing, with 304 investment projects worth USD 3.74 billion in Zanzibar from 2015–2020, creating 16,866 jobs. Recent agreements, such as the Tanzania–Czech Republic Double Taxation Agreement and the Tanzania–UAE Business Council, aim to boost investment in manufacturing and technology.
• Poverty and Employment: The national poverty rate fell from 34.4% in 2007 to 26.4% in 2018, and extreme poverty dropped from 12% to 8%. However, youth unemployment remains a concern, with the private sector employing 70% of youth.

The economy benefits from stable macroeconomic conditions and a reputation for peace, attracting FDI in mining, energy, and tourism. However, challenges include a narrow tax base, foreign exchange shortages, and slow structural transformation, with reliance on low-productivity sectors like subsistence agriculture.

3. Historical Economic Performance

Historical data provides context for assessing the manifesto’s realism:

• GDP Growth: Tanzania has sustained an average GDP growth of 5.5% over the past decade, making it one of Africa’s fastest-growing economies. From 2019 to 2020, real GDP grew by 4.8%, reaching USD 89.5 billion. Zanzibar’s per capita income rose from TZS 942,000 in 2010 to TZS 2,323,000 in 2018.
• Job Creation: The 2020–2025 manifesto targeted 8 million new jobs nationally, with industrial jobs increasing from 306,180 in 2020 to 500,000 by 2025. Zanzibar’s 2015–2020 investments created 16,866 jobs.
• Agricultural Transformation: Irrigated land expanded by 44% (681,383 to 983,466 hectares) from 2020–2024, and food security improved from 114% to 128% (Page 13). The 2022/23 budget allocated TZS 954 billion to agriculture, aiming for 10% sectoral growth by 2030.
• Infrastructure: Past achievements include progress on the Standard Gauge Railway (SGR) and port upgrades, with a goal to increase electricity capacity to 10,000 MW by 2025.

These achievements suggest CCM’s capacity to deliver on economic promises, but slow poverty reduction (26.4% in 2018) and reliance on public investment indicate challenges in achieving inclusive growth.

4. Realism of the Manifesto’s Economic Proposals

To evaluate the manifesto’s realism, we assess its key proposals against current conditions, historical trends, and feasibility:

a. Job Creation (350,000 Jobs in Zanzibar, Potential 8.5 Million Nationally)

• Realism: The target of 350,000 jobs in Zanzibar by 2030 is ambitious but plausible, given past performance (16,866 jobs from 2015–2020 investments). Zanzibar’s focus on tourism (targeting 5 million tourists by 2025, generating USD 6 billion) and the blue economy (300,000 units contribution) supports job creation in high-potential sectors. Nationally, an unconfirmed X post suggests a target of 8.5 million jobs, building on the 2020–2025 goal of 8 million. Achieving this requires scaling private sector-driven growth, as 70% of youth are already employed by the private sector.
• Challenges: Youth unemployment remains high, and the manifesto lacks specific national job targets. Structural transformation from low-productivity sectors like subsistence agriculture (25% of GDP) to industry and services is slow. External risks, such as foreign exchange shortages, could limit private sector investment.
• Support: Initiatives like training 2,500 cooperatives and providing livestock loans (two cows per youth annually) in Zanzibar enhance employability and income generation. Recent agreements with the UAE and Czech Republic signal continued FDI growth.

b. Investment Projects

• Realism: The manifesto’s focus on infrastructure (e.g., 1,108-km Tanga–Arusha–Musoma railway, Bagamoyo port) and the blue economy (Mangapwani port) is likely to attract FDI, building on Zanzibar’s USD 3.74 billion from 2015–2020. Tanzania’s stable growth (5.5% average over 10 years) and strategic location make it a regional FDI hub. Projects like the USD 1.4 billion Tanzania–Zambia railway upgrade and the Kabanga Nickel Project underscore investor confidence.
• Challenges: Funding for large-scale projects is unclear, and public debt (41.1% of GDP) could strain resources. Regulatory challenges, such as land tenure and transparency, deter some investors.
• Support: The manifesto’s alignment with NDV 2050 and recent economic diplomacy (e.g., Tanzania–Mozambique Joint Economic Commission) strengthens the investment climate.

c. Per Capita Income

• Realism: The manifesto’s goal to increase Zanzibar’s per capita income builds on a rise from TZS 942,000 in 2010 to TZS 2,323,000 in 2018. Nationally, GDP per capita grew from USD 981 to USD 1,218 between 2015 and 2021. Initiatives like cooperative training and youth loans (Pages 58) could boost household incomes, particularly in rural areas (70% of the population).
• Challenges: The lack of a quantified target for per capita income limits measurability. Poverty reduction has been slow (26.4% in 2018), and income inequality persists.
• Support: The 35.1% minimum wage increase for public servants (from TZS 370,000 to TZS 500,000 in 2025) reflects efforts to improve incomes.

d. GDP Growth

• Realism: The manifesto does not specify 2030 GDP growth targets but aligns with external projections of 6% for Tanzania and 6.8% for Zanzibar in 2025. Achieving NDV 2050’s 8%+ annual growth requires sustained investment in agriculture (targeting 10% sectoral growth by 2030) and industry. Historical growth (5.3% in 2023, 4.8% in 2020) supports the feasibility of mid-term targets.
• Challenges: Geopolitical tensions, climate shocks, and a narrow tax base could hinder growth. The manifesto’s reliance on public investment may not sufficiently drive private sector-led growth, as noted by the World Bank.
• Support: Agricultural investments (TZS 954 billion in 2022/23) and tourism growth (18% of GDP) provide a strong foundation.

5. Critical Evaluation of Realism

The manifesto’s economic proposals are realistic in several respects:

• Track Record: CCM’s 2020–2025 achievements, such as irrigation expansion (+44%) and food security gains (128% sufficiency), demonstrate implementation capacity. Zanzibar’s historical FDI (USD 3.74 billion, 16,866 jobs) supports the feasibility of investment-driven growth.
• Policy Continuity: The manifesto builds on existing frameworks like FYDP III and NDV 2050, leveraging Tanzania’s stable growth (5.5% average) and low inflation (3.3% in 2025).
• Sectoral Focus: Prioritizing agriculture, tourism, and the blue economy aligns with Tanzania’s economic strengths (agriculture: 25% of GDP; tourism: 18%).

However, challenges threaten realism:

• Ambiguity: Targets like 300,000 units for the blue economy and per capita income increases lack clarity, complicating monitoring.
• Funding Gaps: Large-scale projects (e.g., 1,108-km railway) require significant funding, and public debt (41.1% of GDP) could limit resources.
• Structural Barriers: Slow structural transformation and reliance on subsistence agriculture (25% of GDP) hinder inclusive growth. Youth unemployment and regulatory challenges (e.g., land tenure) persist.
• External Risks: Foreign exchange shortages and geopolitical tensions could disrupt FDI and growth.

6. Conclusion

The CCM Manifesto for 2025 has the potential to drive economic transformation by 2030, but its success will depend on effective implementation and addressing challenges. The manifesto’s targets, such as creating 350,000 jobs in Zanzibar and infrastructure projects like the 1,108-km Tanga–Arusha–Musoma railway, are supported by historical achievements (e.g., 16,866 jobs from USD 3.74 billion in Zanzibar investments) and current growth projections (6% for Tanzania, 6.8% for Zanzibar in 2025). Initiatives like training 2,500 cooperatives and boosting agricultural investment (TZS 954 billion in 2022/23) promote inclusive growth. However, vague targets, funding uncertainties, and structural issues, such as slow economic transformation and a public debt of 41.1% of GDP, demand careful management. With Tanzania’s stable growth (5.5% average) and strategic reforms, the manifesto holds realistic potential to achieve economic change by 2030, provided implementation is strong and external risks are mitigated.

Key figures related to the economic proposals in the Chama Cha Mapinduzi (CCM) Manifesto for the 2025 General Election, launched on May 30, 2025, as requested in the question about its realism in bringing economic change to Tanzania by 2030. The table focuses on job creation, investment, per capita income, GDP growth, and related metrics, incorporating figures from the manifesto and relevant external sources to reflect the current economic situation (as of May 31, 2025, 11:05 AM EAT) and historical data. The figures are selected to assess the manifesto’s potential to drive economic transformation.

Notes:

1. Scope: The table includes key figures from the manifesto (e.g., 350,000 jobs in Zanzibar, 1,108-km railway) and external sources (e.g., 6% GDP growth for Tanzania in 2025, 3.3% inflation in March 2025) to evaluate the manifesto’s realism in driving economic change by 2030. Historical data (e.g., 304 investment projects worth USD 3.74 billion, 44% irrigation growth) provides context for feasibility.
2. Zanzibar Focus: The manifesto provides specific targets for Zanzibar, such as 350,000 jobs and 2,500 cooperatives, but lacks quantified national targets for per capita income and GDP growth, supplemented by external projections.
3. Ambiguity: The “300,000” figure for the blue economy lacks clear units (jobs or output), and per capita income targets are qualitative. National job creation targets (e.g., 8.5 million) are mentioned in external sources but not confirmed in the manifesto.
4. Current Context: As of May 31, 2025, 11:05 AM EAT, Tanzania’s stable growth (5.3% in 2023, 6% projected for 2025) and low inflation (3.3%) support the manifesto’s feasibility, though challenges like public debt (41.1% of GDP) and foreign exchange shortages persist.
5. Alignment with NDV 2050: The figures align with NDV 2050’s goals of achieving over 8% annual GDP growth, with manifesto initiatives like infrastructure and job creation supporting prosperity and inclusivity.