Tanzania sets pace for industrial growth

DODOMA: TANZANIA is seeking to consolidate its industrialisation gains by strengthening private sector participation and expanding local manufacturing as part of efforts to accelerate the country’s economic transformation.

The next phase will also place small and medium enterprises (SMEs) at the centre of industrial development, with renewed policy frameworks aimed at promoting sustainable industrial growth and increasing the contribution of domestic businesses to the economy.

Prime Minister Dr Mwigulu Nchemba said the growth reflects progress made in strengthening domestic production, reducing dependence on imported goods and expanding employment opportunities through industrial development.

“The value of goods produced by industries in the country has increased from 254bn/- in 1996 to 27tri/- in 2025, while the contribution of the industrial sector to the Gross Domestic Product (GDP) has risen from 1.1 per cent to 5.9 per cent over the same period,” he said.

Dr Nchemba made the remarks in Dodoma yesterday during the launch of the Sustainable Industrial Development Policy, 2025, and the revised Small and Medium Enterprises (SMEs) Development Policy, 2003 (2025 Edition).

He further said formal industrial employment had also increased from 63,000 in 1999 to 397,953 in 2025, while the growth rate of industrial activities rose from 4.8 per cent in 1996 to 5.2 per cent in 2025.

“As a country we have made progress towards producing goods that were previously largely imported, including construction materials such as iron sheets, nails, tiles and cement, as well as electrical equipment such as transformers, electricity meters and cables,” Dr Nchemba said.

According to the Premier, some of these products are now being manufactured in surplus and exported to neighbouring countries, contributing to regional trade and foreign exchange earnings.

However, he said sustaining these gains would require policies that respond to changing economic conditions, national priorities and opportunities arising from regional and international economic integration.

The revised SME policy is expected to address some of the longstanding challenges facing small businesses, particularly access to finance, infrastructure, technology and markets.

Minister for Industry and Trade, Ms Judith Kapinga said the review of the SME policy, first introduced in 2003, was necessary to align entrepreneurship development with changing economic realities, technological advancements and emerging business opportunities.

She said the revised framework seeks to improve the capacity of small and medium-sized enterprises to establish, formalise, expand and sustain their operations.

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“Its priorities include improving business-supporting infrastructure, expanding access to finance, promoting technology adoption and innovation, and opening up markets for products and services produced by SMEs,” she said.

Ms Kapinga said the policy also seeks to expand entrepreneurship opportunities in both rural and urban areas, with particular attention to women and young people.

She said Tanzania had approximately six million small-scale entrepreneurs in 2024, with the government targeting an increase to 16 million by 2035.

Achieving the target, she said, would require coordinated efforts to address constraints relating to financing, infrastructure, technology, business formalisation, entrepreneurial skills and access to reliable markets.

“The revised SME policy is also expected to complement the Sustainable Industrial Development Policy, 2025, by strengthening linkages between small businesses and larger industrial investments, promoting local production and increasing value addition,” Ms Kapinga said.

Dr Nchemba said the private sector would be central to the country’s development ambitions, noting that under the National Development Vision 2050, it is expected to contribute 70 per cent of investment and implementation of development plans, while the public sector will account for 30 per cent.

He said a stronger private sector was essential for expanding the tax base, creating employment for the young.