E-commerce set to thrive

DAR ES SALAAM: TANZANIA is actively consolidating essential infrastructure and systems to ensure the seamless physical delivery of items procured online through electronic commerce (ecommerce).

With advancements in digital infrastructure, supportive regulatory frameworks and strategic government initiatives, the country is positioning itself as a regional leader in e-commerce services.

A recent report highlights that Tanzania possesses the critical infrastructure and applications required to support highspeed internet services and robust payment systems two indispensable components for a thriving e-commerce ecosystem.

The country’s policy and regulatory measures have addressed most of the enabling factors necessary for e-commerce development, creating a conducive environment for growth.

The Director General of the Tanzania Communications Regulatory Authority (TCRA), Dr Jabiri Bakari, recently stated that the authority had licensed 146 ap- plication service providers by September 2024.

These providers play a vital role in facilitating internet services, which are essential for the smooth functioning of e-commerce platforms. During the same period, 41,376,545 internet users accessed services via mobile, wireless and fixed devices.

Dr Bakari further revealed that 60,815,533 active mobile money accounts had conducted an impressive 310,881,561 transactions in September 2024 alone.

These figures highlight the growing reliance on mobile platforms for financial transactions, underscoring their importance in supporting digital payments and enabling seamless e-commerce operations.

The convenience of delivering digitally procured items to homes or offices has been largely driven by the exponential growth of mobile communication, increased internet penetration, social media influence, digital marketing opportunities and enhanced communication technologies.

These advancements have created an efficient system where consumers can order goods online and receive them promptly at their preferred locations.

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To further strengthen this ecosystem, the Government Tanzania is actively overseeing the development of e-commerce applications.

Efforts are also being made to integrate the National Physical Address System (NAPS) with other social services platforms and systems.

This integration ensures accuracy in service delivery and enhances logistical coordination.

In addition, the government has launched initiatives focused on establishing bonded warehouses and enabling logistics infrastructure for e-commerce operations.

These bonded warehouses play a crucial role in facilitating international trade by providing secure storage for imported goods before they reach end consumers.

Dr Bakari highlighted how NAPS has revolutionised postal services in Tanzania. Thanks to this system, goods purchased online whether domestically or internationally can now be delivered efficiently and securely to the buyer’s residence or office.

He noted that such advancements make e-commerce a more attractive option for consumers and businesses alike.

To facilitate physical deliveries, TCRA has licensed 147 courier companies by September 2024.

These companies, alongside independent transport operators including motorcycle taxis (bodabodas) have played an instrumental role in bridging the lastmile delivery gap.

This diverse delivery network ensures that both urban and rural areas are well-served, supporting inclusivity in ecommerce access.

Tanzania’s strategic geographical location gives it an edge in becoming a regional e-commerce hub.

The country shares borders with eight neighbouring nations, five of which are landlocked.

This positioning creates an opportunity for Tanzania to serve as a key logistics centre for regional trade and e-commerce deliveries.

Furthermore, Air Tanzania, the national airline, is actively developing its cargo fleet to meet the growing demands of e-commerce.

This strategic move aims to improve cross-border trade efficiency, facilitate timely deliveries and strengthen Tanzania’s role as a regional logistics hub.

Beyond facilitating ecommerce, the National Physical Address System (NAPS) has also enhanced the government’s ability to roll out public services and communicate with citizens more effectively.

It played a significant role in the success of the 2022 National Census, where accurate location data ensured comprehensive coverage and effective data collection across the country.

The e-commerce boom in Tanzania is not only transforming how people shop but also how businesses operate.

Small and Medium Enterprises (SMEs) are particularly benefiting from digital platforms, enabling them to reach broader markets and reduce operational costs.

Entrepreneurs can now market and sell their products to customers within Tanzania and beyond, leveraging digital tools and logistical networks established under the NAPS framework.

Additionally, the rise of e-commerce is generating significant employment opportunities.

From digital marketers and software developers to delivery agents and logistics managers, the sector is creating new jobs and fostering skill development in various digital fields.

The Tanzanian government recognises the transformative power of e-commerce and remains committed to enhancing the necessary infrastructure, developing enabling policies and fostering public-private partnerships.

These efforts aim to address challenges such as digital literacy, cybersecurity concerns and the need for efficient crossborder trade facilitation.

By leveraging its strategic location, robust mobile money systems, growing internet penetration and supportive policies, Tanzania is poised not only to meet domestic e-commerce demands but also to serve as a hub for regional and international digital trade.

The future of e-commerce in Tanzania looks bright, with immense potential to drive economic growth, job creation and improved quality of life for its citizens.