Comprehensive Economic Analysis & Investment Guide
Tanzania enters 2026 with strong macroeconomic fundamentals, characterized by robust GDP growth accelerating from 5.5% in 2024 to approximately 6.0% in 2025, projected to reach 6.3% in 2026. The economy is expected to expand to approximately USD 87 billion, with GDP per capita rising toward USD 1,300.
| Indicator | 2024 | 2025 | 2026 (Proj.) | Trend |
|---|---|---|---|---|
| Real GDP Growth (%) | 5.5% | 6.0% | 6.3% | Accelerating |
| GDP Value (USD billion) | $78.8 | ~$82 | ~$87 | Growing |
| GDP per Capita (USD) | $1,200 | ~$1,250 | ~$1,300 | Rising |
| Inflation (%) | 3.1% | 3.3% | 3.5% | Controlled |
| Metric | 2024 | 2025 | 2026 (Proj.) | Status |
|---|---|---|---|---|
| Debt-to-GDP Ratio (%) | 47.3% | 46.8% | 45.0% | Declining |
| Fiscal Deficit (% of GDP) | 2.5% | 2.5% | 2.5% | Under Control |
| Tax Revenue (% of GDP) | 13.1% | 13.1% | 13.5% | Improving |
| FX Reserves (USD billion) | $6.3 | $6.3+ | $6.5+ | Adequate |
Assessment: Tanzania maintains a "moderate risk" debt distress classification by the IMF. The present value of public debt declined from 41.1% (2023/24) to 40.6% (2024/25), on a positive trajectory toward 39.5% by 2026/27. Fiscal discipline is improving with the deficit narrowing to 2.5%, well within the EAC convergence criterion of 3% of GDP.
| Sector | GDP Share (%) | Growth Rate 2024 (%) | Employment Share (%) | Performance |
|---|---|---|---|---|
| Services | 42-44% | 5.2-15.4% | 29% | Strong |
| Industry | 30-31% | 6.5-8.6% | 6.8% | Growing |
| Agriculture | 25-27% | 3.0-5.0% | 65% | Moderate |
Achievement: Tanzania was named "Africa's Leading Destination" at the World Travel Awards 2025. The sector experienced a remarkable 132% increase in international arrivals from 2021-2024, with the Serengeti recognized as the best safari destination globally for six consecutive years (2019-2024).
| Indicator | 2024 | Performance |
|---|---|---|
| GDP Contribution | 10.1% | Growing |
| Sector Growth Rate | 8.6% | Strong |
| Gold Production | 60,000 kg | All-time high |
| Mineral Export Value | ~$4.5 billion | Record |
| Gold Share of Total Exports | 52% | Dominant |
| Direct Employment | 310,000+ | Expanding |
Critical Minerals Opportunity: Tanzania holds significant untapped reserves of nickel (Kabanga deposit - one of world's largest), graphite (Lindi Jumbo project for EV batteries), lithium, cobalt, and rare earth elements. Natural gas reserves exceed 55 trillion cubic feet, with the Likong'o-Mchinga LNG project planned at $30 billion investment.
While agriculture employs 65% of the workforce (~20 million workers), it contributes only 26% of GDP, highlighting persistent low productivity issues. Cereal yields are at only 40% of world average, and only 1.5% of suitable cropland is irrigated (95% rain-fed), making the sector highly vulnerable to climate change.
Growth Areas:
Manufacturing has remained stagnant at ~8% of GDP since the mid-1990s—a critical constraint on Tanzania's structural transformation. Export orientation is particularly weak, with manufacturing contributing less than 25% of total exports. This limits job creation and industrial diversification despite the sector employing approximately 7% of the workforce.
| Year | FDI Inflows (USD) | Growth Rate | % of GDP | Regional Rank |
|---|---|---|---|---|
| 2022 | $1.26 billion | +6.2% | - | - |
| 2023 | $1.34-1.60 billion | +5.9-13.2% | 2.06% | #11 Africa |
| 2024 | $1.72 billion | +28.3% | 2.2% | #11 Africa |
| 2025 (Target) | $15 billion | - | - | Ambitious |
Regional Leadership: Tanzania recorded the fastest FDI growth rate in East Africa at 28.3%, exceeding the regional average of 12% and continental average. This positions Tanzania among Africa's top performers in attracting foreign investment.
| Rank | Country | Investment (USD) | Share (%) |
|---|---|---|---|
| 1 | 🇦🇪 United Arab Emirates | $502.02 million | 31.0% |
| 2 | 🇨🇳 China | $438.41 million | 27.1% |
| 3 | 🇮🇳 India | $176.18 million | 10.9% |
| 4 | 🇸🇬 Singapore | $139.50 million | 8.6% |
| 5 | 🇫🇷 France | $102.00 million | 6.3% |
| Sector | Projects | Capital (USD) | Focus Areas |
|---|---|---|---|
| Manufacturing | 377 | $3.1 billion | Agro-processing, textiles, consumer goods |
| Transport | 138 | $1.2 billion | Infrastructure, logistics |
| Commercial Buildings | 91 | $706 million | Real estate, offices |
| Agriculture | 66 | $599 million | Value addition, mechanization |
| Tourism | 76 | $337 million | Hotels, eco-lodges |
| Energy | - | $373 million | Gas, renewables (+546% QoQ) |
Five Major SEZs Launched (August 2025):
| Country | 2020 Rank (out of 190) | Score (0-100) | Regional Position |
|---|---|---|---|
| Rwanda | 38 | 76.5 | #1 in EAC |
| Kenya | 56 | 73.2 | #2 in EAC |
| Uganda | 116 | 60.0 | #3 in EAC |
| Tanzania | 141 | 54.5 | #4 in EAC |
Note: World Bank discontinued Doing Business rankings in 2020. Tanzania has implemented MKUMBI I (2018-2023) and MKUMBI II (2023+) regulatory reform blueprints to improve the business climate.
| Country | Rank (out of 180) | Score (0-100) | Trend | Context |
|---|---|---|---|---|
| Rwanda | 57 | 57 | Best in EAC | Regional leader |
| Tanzania | 82 | 41 | +1 from 2023 | Above SSA avg (33) |
| Uganda | 114 | 26 | Below average | - |
| Kenya | 123 | ~30-35 | Below average | - |
Significant Progress: Tanzania has achieved an 86% improvement since 2001 (score rising from 22 to 41), making it one of only 5 African countries with substantial corruption reduction over the past decade. The country now ranks above the Sub-Saharan Africa average of 33.
| Risk Category | Severity | Trend | Key Issues |
|---|---|---|---|
| Climate Change Impacts | HIGH | Worsening | Agriculture vulnerability, droughts, floods |
| Infrastructure Deficits | HIGH | Improving slowly | Electricity access (<50% population), transport gaps |
| Skills Shortage | HIGH | Worsening | 90% TVET teacher gap, tech skills deficit |
| Export Dependence | HIGH | Stable | Gold = 52% of exports |
| Current Account Deficit | MODERATE | Widening | 4% of GDP, import dependence |
| Debt Sustainability | MODERATE | Improving | 46.8% debt-to-GDP, declining trajectory |
| Metric | Current Status (2024-2025) | 2030 Goal | Gap |
|---|---|---|---|
| Overall Access (Mainland) | 78.4% | 100% | 21.6% |
| Population Coverage | <50% | 75% | 25%+ |
| Urban Access | 99.6% | 100% | 0.4% |
| Rural Access | 69.6% | 100% | 30.4% |
| Hamlets with Access | 28,659/64,760 | 64,760 | 36,101 hamlets |
| Investment Needed | - | $12.9 billion | TZS 6.7T for hamlets |
| Annual Connections Required | 562,940 (achieved 2024) | 1.6 million/year | 2.8x increase needed |
Critical Gap: Despite 99.1% of villages being electrified, less than 50% of the mainland population is actually connected. This represents a massive last-mile challenge requiring TZS 6.7 trillion investment and tripling current connection rates.
| Indicator | Demand | Supply | Gap |
|---|---|---|---|
| TVET Teachers Needed | 620 | 62 available | 558 shortage (90%) |
| Total Teachers (Next Few Years) | 72,400 | Current workforce | Massive shortage |
| Tech Employment (2025 Proj.) | 215,000 | 35,000 (2019) | +614% growth needed |
| Healthcare Workers Ratio | 1:1,000 (WHO) | 1:1,982 | Nearly half of target |
Tanzania ranks 145th out of 187 in climate readiness. Key impacts include:
| Country | GDP (USD billion) | Population (M) | Growth Rate 2025 | FDI Growth 2024 |
|---|---|---|---|---|
| Kenya | $131.67 | ~55 | 5.3% | Flat (0%) |
| Ethiopia | $117.46-205 | ~126 | 7.2% | +21.9% |
| Tanzania | $73-87 | ~65 | 6.0% | +28.3% ✓ |
| Uganda | $56.31 | ~48 | 6.0% | +10.4% |
| Rwanda | $13.7 | ~14 | 7.2% | +14.4% |
| Metric | 2026 | 2027 | 2028 | 2029 | 2030 | CAGR |
|---|---|---|---|---|---|---|
| Real GDP Growth (%) | 6.3 | 6.5 | 6.7 | 6.8 | 7.0 | 6.7% |
| GDP Value (USD billion) | ~$87 | ~$93 | ~$99 | ~$106 | ~$113 | 6.8% |
| GDP per Capita (USD) | ~$1,300 | ~$1,360 | ~$1,420 | ~$1,485 | ~$1,550 | 4.5% |
| Sector | Investment Potential | Key Projects | ROI Drivers |
|---|---|---|---|
| Energy | $15B+ | Gas-to-power, renewables, transmission | Universal access demand, industrial growth |
| Infrastructure | $12B+ | SGR completion, ports, roads, airports | Regional trade hub, landlocked neighbors |
| Mining | $10B+ | Nickel, graphite, LNG, gold expansion | Critical minerals boom, EV supply chain |
| Manufacturing | $8B+ | SEZ development, agro-processing | Import substitution, export markets |
| Tourism | $5B+ | Hotels, eco-lodges, attractions | 8M visitor target, premium positioning |
| Agriculture | $4B+ | Irrigation, mechanization, value addition | Food security, export growth |
The 2026-2030 period establishes the structural foundations for Tanzania's Vision 2050 goal of becoming a middle-income country with a $1 trillion economy. By 2030, Tanzania aims to reach $113 billion GDP (~11% of 2050 goal), positioning the country firmly on the path to high-income status.
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