ON THE MOVE AN ECONOMY FIRMLY SET ON AN UPWARD TREND
The land of Mount Kilimanjaro, the Serengeti Plain, and the spice islands of Zanzibar, Tanzania is a regional leader with a wealth of natural resources and access to huge markets. Foreign investment is the key to its future.

Natural wonders and an abundance of wildlife provide Tanzania with huge potential as a premier tourist destination

Tanzania is a country in transition. Politically stable and committed to free market principles, the East African nation is promoting private enterprise and looking for investment as it seeks to realize its dream of becoming a fully developed economy.

Under the leadership of its President, Benjamin Mkapa, the country has enjoyed political stability and economic success. The government’s ongoing program of liberalization, privatization, and strict fiscal and monetary policies is backed by the International Monetary Fund and the World Bank, and recent data confirms that the economy is firmly embarked on an upward trend.

In 2002, growth was 6.2% in real terms, compared with 5.7% in 2001. By the end of March this year, the inflation rate was down from 5.2% to 4.2%, while official foreign exchange reserves rose from US$1.3 billion to US$1.5 billion. Improvements in the tax structure have brought substantial increases in revenue collection. Overall, the government is moving closer to realizing its objectives of boosting foreign exchange, creating employment, and alleviating poverty.

Tanzania is heavily dependent on agriculture, which accounts for almost 50% of the country’s gross domestic product. Government policy is to boost the sector, but also to diversify and to promote agro-processing and other areas of the economy.

BASIL MRAMBA
BASIL MRAMBA
Minister of Finance
DAUDI T. S. BALLALI
DAUDI T. S. BALLALI
Governor of the Bank of Tanzania

“The government has already started to take measures to revive agriculture, and there are similar plans in support of tourism, mining, commercial fishing, and small and medium-scale enterprises,” says Minister of Finance Basil Mramba.

Tanzania is not yet ready to export in large quantities to the United States or Europe. In order to do that, it needs to attract large investors and capital to put it in a position where it is able to compete in the market.
Measures have been taken to attract investors, as Daudi T.S. Ballali, Governor of the Bank of Tanzania, explains, “We have cut bureaucracy and, most importantly, we have changed our laws to make Tanzania more competitive and attractive compared to other investment destinations.”

Mining and tourism are the fastest growing sectors. Tanzania is set to become Africa’s third largest gold producer, after South Africa and Ghana. “The minerals sector is already moving,” says Mr. Ballali. “We have given investors better breaks than our competitors, so the investment is coming here.”


SECTORAL CONTRIBUTION TO GROSS DOMESTIC PRODUCT (2002)

Tourism is a sector with huge potential, given natural marvels ranging from Mount Kilimanjaro and the Serengeti Plain to the Ngorongoro Crater, and abundant wildlife.

Low-cost labor and a wealth of natural resources are among Tanzania’s major attractions for investors, while its membership in the East African Community (EAC) and the South African Development Community (SADC) gives it access to potential export markets of 250 million people. Tanzanian goods qualify for preferential trade access to the United States under the African Growth and Opportunity Act (AGOA), and also to Europe under the Everything-but-Arms agreement between the EU and African, Caribbean, and Pacific (ACP) countries.

Six landlocked nations have access to Tanzania‘s ports, and Dar es Salaam, the country’s major business center, boasts one of the most efficient and modern harbors on the African continent.

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