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.