Tanzania is poised to become one of Africa’s top three wealthiest nations within five years, having doubled its wealth over 15 years. The economy is growing through sectors such as manufacturing, tourism, agriculture, and financial services, with notable foreign investments and a significant GDP increase. However, risks from regional conflicts and climate change may impact future growth.
Tanzania is on the trajectory to become one of Africa’s wealthiest nations within five years, having remarkably doubled its wealth over the past 15 years. The country has shifted its economic focus to manufacturing, tourism, agriculture, and financial services, which have significantly contributed to its growing economy. According to the World Economic Forum, Tanzania’s wealth per capita rose from £194 in 2000 to £372 in 2015, alongside a 6% increase in basic consumption and a 2% decrease in extreme poverty during the same period.
The socioeconomic advancement of Tanzania has markedly accelerated over the last decade, thanks to the leadership of former President John Pombe Magufuli and the current President Samia Suluhu Hassan. “Tanzania has a reputation for peace and stability compared to [other] countries in East Africa,” noted Tenda Msinjili, head of banking and finance at Clyde & Co.’s Tanzania office. This stability enhances the country’s investment appeal, as foreign investors are more willing to invest with reduced concerns about political upheaval. In 2023, Tanzania attracted £1 billion in foreign direct investment.
Investors are increasingly drawn to Tanzanian opportunities in mining, energy, agriculture, tourism, manufacturing, transportation, and commercial real estate, as reported by Global Finance. The country has fostered this investment climate through effective contract protections, dispute resolution, infrastructure improvements, and the exploitation of its rich natural resources, including gold, diamonds, silver, gas, and uranium.
In 2020, Tanzania’s GDP grew by 4.8%, reaching approximately £69.3 billion, making it the second-largest economy in East Africa after Kenya. Looking ahead, the finance minister and central bank governor anticipate that the economy will grow by about 6% in 2025, following a projected growth of 5.4% in 2024. The International Monetary Fund predicts Tanzania may achieve a £105 billion economy by 2028. However, potential risks to this growth include regional conflicts, commodity price fluctuations, global economic slowdowns, and climate-related natural disasters.
In terms of trade, Tanzania’s primary export partners are India, the UAE, South Africa, Kenya, and Rwanda, while its main import partners comprise China, India, the UAE, the DR Congo, and Saudi Arabia.
In conclusion, Tanzania’s impressive economic growth and transformation signify its potential to become one of Africa’s richest nations in the foreseeable future. Enhanced stability, significant foreign investments, diversified economic sectors, and progressive leadership have all contributed to this promising trajectory. Nevertheless, external and internal challenges need to be addressed to sustain this upward momentum in economic development.
Original Source: www.express.co.uk
