| Capital(s): |
Dodoma |
| Population: |
36,766,356 (2007) |
| Area: |
945,087 Km˛ |
| Currency: |
1 Tanzanian shilling = 100
cents |
Language(s):
Dialling Code |
English, Swahili
+255 |
|
Tanzania was created by the union of the former colonial
territory of Tanganyika and Zanzibar. The country is situated in
East Africa and is bordered by Rwanda, Uganda, Kenya, Burundi,
the Democratic Republic of Congo, Zambia, Malawi and Mozambique.
Dar es Salaam is the country’s most important port. Arusha,
Dodoma and Mwanza are other important cities.
 After
gaining its independence from Britain in 1961, Tanganyika
initially followed a British parliamentary form of government.
In 1962 a presidential form of government replaced it. Julius
Nyerere (pictured left) was elected to the position of president in 1964. He
took steps to form a unified state and his efforts led to the
adoption of the Interim Constitution of the United Republic of
Tanzania and a union between the former Tanganyika colony and
the islands of Zanzibar.
The union was cemented in 1977 with the merger of Tanzania’s
ruling party Tanzanian African National Union and the main
representatives of Zanzibar – Afro Shirazi Party to form a new
party called the Chama Cha Mapinduzi or Revolutionary Party. The
adoption of the permanent constitution with the provision that
allowed Zanzibar to elect representatives to the National
Assembly further strengthened these ties.
Ndugu Ali Hassan Mwinyi became president in 1985 and started
a process of political and economic reform moving away from the
socialist economic policies of President Nyerere. One of the
political reform objectives was realised in 1992 when the
constitution
 was
amended and a multi-party system was introduced. Benjamin
William Mkapa was elected president in 1995 and continued with
these reforms and presides over a relatively stable political
environment. He has promoted a culture of human rights and
non-racial policies. The press enjoys the benefits of freedom of
speech and is allowed to employ a critical reporting style.
The current president, Jakaya Mrisho Kikwete (pictured right) began his term
in December 2005.
Tanzania’s economy is a reflection of its relatively stable
political situation. The economy has progressed steadily since
the implementation of macroeconomic stabilisation and structural
reform programme in the mid-nineties.
The agricultural sector in particular has benefited from this
programme with the liberalisation of production and marketing
structures and product prices. In 2002 this sector contributed
44.7% of the country’s GDP. The country’s inflation continues to
improve as a result of foreign assistance and fiscal
consolidation and resulted in a stronger balance of payments
position. It is an indication, however, of the degree to whi ch
the country is dependent on foreign assistance.
Progress with privatisation has been mixed and although a
number of significant enterprises have been successfully
privatized, the country’s utilities remain in the hands of the
state. In 2001 the country attracted FDI worth US$224.4 million. In
2002 the country’s GDP amounted to US$9.4 billion and industry
accounted for 16% while services made up 39.4%. Tanzania was
rated 164th on the Human Development Index in 2005.
The main sectors are agriculture, tourism, telecommunications,
mining, fishing, forestry, manufacturing and the energy
industries. Agriculture plays an important economic role,
which, accounts for half of the country's GDP, provides 85% of
exports, and employs 90% of the work force. However, only 4% of
the land is cultivated due to the country's topography and
climatic conditions. The raising of livestock takes place in
those areas with low rainfall as they have no tsetse flies. The
main cash crops include coffee, cotton, cashew nuts, sisal,
tobacco, tea, coconuts and cloves, pyrethrum, corn, wheat,
cassava, bananas, fruits, vegetables, cattle, sheep and goats.
The agricultural sector is proving to be the source of many
opportunities. The government is eager to attract investment to
this sector with the motivation that the country could become a
major grain producer if the correct irrigation infrastructure is
developed. The Tanzania Investment Centre has played a
facilitating role in this regard and in 2000 123 projects were
undertaken and realised TShs 264,775 million.
Tourism occurs not only on the beautiful islands with their
extensive beaches, spices and Arab architecture, but also on the
mainland. The wildlife parks of Tanzania have proved to be very
popular with tourists. Tourism continues to expand with
significant foreign investment in hotels and other tourist
facilities.
 The
Indian Ocean and Lake Tanganyika have proved to be plentiful in
fish fueling the domestic fishing industry. Fishing is an
important contributor to GDP.
Mining has attracted international interest with a large
amount invested in exploration for gold, base metals and
diamonds. Companies from Australia, South Africa and Canada have
invested in the gold sector as Tanzania is becoming one of
Africa’s major producers.
Tanzania has many energy resources which include natural gas,
biomass, hydropower, geothermal, coal, solar and wind power.
Much of this energy potential remains unexploited although the
government hopes to change this situation and is promoting the
expansion of this industry. This is part of an active policy by
the government to replace imported petroleum products with
locally produced products. A project involving the construction
of a natural gas pipeline from Songo-Songo to Dar es Salaam is
to be primary source of energy in the future.
Telecommunications in the country are extensive with separate
organisations catering for the fixed telecoms needs of the
mainland and the islands. In the manufacturing sector, products
such as salt, soda ash, cement, shoes, apparel, wood products
and fertilizer are produced.
The UNIDO is engaged in various programmes with the Tanzanian
government which aim at the development of industry in the
country. Upon review of the implementation of these programmes,
the UNIDO has expressed its satisfaction with progress made and
has cited areas of commendation such as a marked increase in the
export of fish to the EU.
The Tanzanian government has sought to attract foreign
investment with the Investment Act of 1997 forming part of this
process. It led to the creation of the Tanzania Investment
Centre which identifies possible investment opportunities and
aids the potential investor in navigating any procedural
barriers that might exist. Tanzania established its own stock
exchange in 1998 called the Dar es Salaam Stock Exchange.
The government has carried out the second phase of its
privatisation programme and opportunities exist in the utilities
sector. The energy, manufacturing, natural resources and capital
market sectors are also promising. The government has extended
the privatisation programme to the transport sector and
announced the sale of 75% of the national air carrier in May
2002.
 Legislation
guarantees the right to private ownership and the right of
establishment. While there is legislation to protect property
rights, US investment authorities have stated that it is
difficult to gain protection under these laws. The Government’s agenda on promoting investment has resulted
in increasing number of foreign direct investments in the
country, and, economic and structural reforms that have led to
significant progress in establishing a functioning market
economy. Institutional support for priority investment projects
is freely available from the Tanzania Investment Centre (TIC)
and other Government institutions.
The Tanzanian government has taken active steps to invest the
country's transport infrastructure, by implementing a programme
to uphold the building good quality roads. There is a sustained
programme for building good quality roads. Two railway networks
link fourteen out of twenty cities and the neighbouring country
of Zambia. There are also international and domestic airports
connecting Tanzania to the rest of the global community. The
three major ports of Dar es Salaam, Tanga and Mtwara operate as
hubs for traffic that stems from it, and destined to land locked
neighbouring countries of Uganda, Burundi, Rwanda, Zambia,
Malawi, and Democratic Republic of Congo.
A large number of market opportunities are available for
foreign companies in Tanzania. With a population of over 34.5
million consumers, a fast growing economy, and high levels of
domestic investment spending, the Tanzanian market remains an
imp ortant
target destination for local and foreign products and services.
Tanzania is also a member of two distinct market communities,
Southern Africa Development Community (SADC) and the East
African Community (EAC), possessing about 304 million consumers.
Tanzania has aimed to provide competitive fiscal
administration on foreign trade, and as a result, has signed
double taxation treaties with Denmark, India, Italy, Norway,
Sweden, Kenya, Uganda, Zambia and Finland. Tanzania continues to
participate in negotiations with South Africa, Republic of
Korea, Zimbabwe, United Arab Emirates, Russia, Seychelles,
Mauritius, Egypt, Yugoslavia and Oman over double taxation
treaties.
Coffee is the country’s main export product, while sisal and tea
also earn significant amounts of foreign currency. Manufactured
goods, cotton, cashew nuts, minerals and tobacco products are
exported mainly to India, the UK, Germany, Japan, the
Netherlands and Belgium.
The country imports products such as consumer goods,
machinery and transport equipment, crude oil and industrial raw
materials. They are supplied these products by South Africa,
Japan, the USA, India and Japan among others.
As of 2005, Tanzania's main trading partners have been China,
India, South Africa, Canada, the Netherlands, United Arab E mirates,
Kenya, United Kingdom, Germany and Bahrain.
Mainland Tanzania has two separate rail systems with different
gauges. Each rail system starts in Dar es Salaam and is
administered by a separate authority. The Central Railway links
to the countries of Kenya, Burundi, Rwanda and Uganda and also
serves a portion of eastern DRC. Tazara Railway links to
Tanzania’s southern neighbours through Zambia. Although the
systems are extensive, they are both badly in need of repair.
Roads in the country are in a poor condition with the
majority remaining untarred. In 1990 a programme was launched
with the assistance of the World Bank to repair the roads and
spur economic development.
Assistance from the Japanese government has aided in the
modernisation of the telecommunications system.
Electricity requirements are catered for by hydro-electric
facilities on the Rufiji-Ruaha and Pangani rivers.
Dar es Salaam is the most important port in the country with
eleven deep water berths. It serves not only Tanzania, but also
caters for the needs of some of the country’s landlocked
neighbours. The World Bank has provided financing for a
modernisation programme for the harbour.
Tanzania boasts relatively good medical services. At least 90%
of the population enjoys easy access to health care. Medical
clinics are well equipped for primary healthcare although there
is a shortage of doctors. It is advised to travel to Kenya or
South Africa for serious illness. The IMF has provided the
funding for an immunisation programme. The government
successfully implemented the programme which sought to immunise
at least 75% of children under the age of two against measles.
The government has also embarked upon a programme to control the
spread of the HIV/AIDS disease.
Infectious diseases that visitors need to be aware include
malaria, tuberculosis, cholera, hepatitis A, typhoid fever,
yellow fever (regional), schistosomiasis and dengue fever.
International flights to Dar es Salaam are available from
London, Nairobi and other neighbouring countries. Arusha and
Zanzibar are other direct international destinations. Domestic
air travel is convenient with a large number of airports in the
country.
The condition of the road and rail networks is not good
enough.
 IDIS
is able to offer assistance to business seeking to invest in,
export to or import from Tanzania. For more information, please
visit the following links: FDI and
Investments.
The Tanzania Investment Centre is also able to provide the
potential investor with an invaluable service as an investment
facilitator.
Licenses are necessary for the mining, telecommunications,
broadcasting, fishing, tourism, banking or insurance industries.
Commercial courts have also been established in an effort to
ensure the resolution of business disputes.
Although the political situation in the country is relatively
stable, there have been very few isolated incidents of violence. These
have not effected business and are not a material threat to
doing business in the country.
The political future of the country is unclear as many analysts
are unsure of the continued existence of the political union
between the mainland and the islands. There is however no
indication that economic ties between the two will be ended. The
IMF is also optimistic for the economic future of the country.
For more information please visit
Mbendi
or
World Bank. To find out 'why to invest in Tanzania' please
visit our FAQs section
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