Tanzania’s quiet boom: Why investors take closer look at EA’s rising hub

DAR ES SALAAM: AS Tanzania enters 2026, the country is no longer speaking about potential.

It is speaking about delivery. Years of public and private investment in ports, railways, roads, urban mobility and regulatory reform are quietly transforming Tanzania into one of Africa’s most stable and steadily growing economies, reshaping its role in regional trade and investment.

For investors who once overlooked the country in favour of flashier frontier markets, curiosity has turned into conviction. The numbers help explain why.

The International Monetary Fund expects Tanzania’s economy to grow by around 6–6.3 per cent this year, keeping it among the fastest-growing economies on the continent.

Beyond that headline figure, official investment data shows the scale of the transformation under way.

The construction sector alone is forecast to grow at an average annual rate of 7.7 per cent between 2026 and 2029, underpinned by large infrastructure programmes spanning transport and water projects.

Multilateral partners have the African Development Bank committed 2.5 billion US dollars ( about 6.195tri/) to priority transport and logistics infrastructure, including roads and rail links that are central to reducing transit times from Dar es Salaam to regional trade markets.

Meanwhile, the World Bank has approved financing totaling more than 1.3 billion US dollars (about 3.22tri/-) for urban mobility, climate-resilient rail improvements and private-sector development in key cities like Dodoma and Dar es Salaam.

“The environment for investment in Tanzania is now secure, predictable and highly productive,” says Prof Kitila Mkumbo, Minister of State in the President’s Office for Planning and Investment.

“We have strengthened infrastructure, stabilised regulations and created both fiscal and non-fiscal incentives that make Tanzania one of the most attractive investment destinations in Africa.”

Statistics underline this optimism. Between 2021 and December 29, 2025, Tanzania saw registered investment projects soar from 252 to 915, while foreign capital inflows nearly tripled, reaching 10.95 billion US dollars, up from 3.7 billion US dollars (about 9.169tri/-) in 2021.

Prof Mkumbo discloses the employment impact: “These projects are expected to generate more than 161,678 jobs, giving tangible opportunities to Tanzanians while boosting production and export potential,” he says.

The projects span manufacturing, construction, transport, and logistics, with both Tanzanian and foreign investors contributing.

Of the 915 projects registered in 2025, 284 are locally owned and 442 are foreignowned, demonstrating broadbased confidence.

Tanzania now hosts 34 Special Economic Zones, including 16 managed by the Tanzania Investment Special Economic Zone Authority (TISEZA), 12 by the private sector, four by local governments and two by public corporations.

During 2025, 20 EPZ and SEZ projects worth 243.17 million US dollars (about 579.88bn/-) were approved, expected to generate 4,822 jobs and exports of 227.43 million US dollars, across regions including Mtwara, Pwani, Iringa, Ruvuma, Kilimanjaro, Njombe and Lindi.

Investors benefit from streamlined processes at TISEZA’s One Stop Facilitation Centre, where 14 government institutions operate under one roof.

Services include issuing investment certificates, company registration, tax incentives, work and residence permits, environmental clearances and sectorspecific approvals.

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Prof Mkumbo stresses: “We have eliminated bureaucracy, saving investors both time and cost. Our digital investment platforms, such as the Tanzania Electronic Investment Window, allow issuance of certificates within 24 hours, making Tanzania extremely investor-friendly.”

Tanzania also offers a mix of fiscal and non-fiscal incentives that reward both foreign and domestic investors.

Corporate tax reductions of 10–20 per cent are available in key sectors, alongside exemptions on customs duties and VAT for capital goods, tax holidays for up to ten years, fast-tracked work permits for expatriates and rights to repatriate profits.

Non-fiscal incentives include access to land, infrastructure, finance and simplified licensing.

Prof Mkumbo notes, “Our incentives are outcome-oriented: they encourage job creation, local value addition, technology transfer and export growth.”

Infrastructure investment underpins much of Tanzania’s transformation. The expansion of the port of Dar es Salaam, upgrades to highways and rail corridors and flagship projects such as the Kigongo–Busisi Bridge are connecting Tanzania to regional markets in Rwanda, Zambia and the Democratic Republic of the Congo.

More interestingly, five strategic SEZs are now operational or expanding: Bagamoyo EcoMaritime City, Kwala, Nala, Buzwagi and Benjamin Mkapa SEZ.

Since August 2025, more than 60 investors have expressed interest, with five new projects allocated land in Bagamoyo alone, including a food-grade packaging factory, a metal processing and galvanising plant, agro-processing of cashews and coffee, steel and ferroalloys production for export and a vehicle assembly plant expected to generate over 1,000 direct jobs.

Prof Mkumbo touts the diversity of opportunity: “Tanzania is rich in sectors that can drive employment, foreign earnings and industrial growth.”

Investors and advisers point to eight sectors where momentum is building.

Industrialisation is at centre of government policy. New special economic zones in Nala, Kwala and Bagamoyo are drawing interest in automotive assembly, pharmaceuticals and textiles, supported by tax incentives and simplified regulation.

In agriculture, the focus is shifting from exporting raw commodities to processing them locally.

Coffee, cashews and fruit are increasingly being targeted for value addition, creating demand for cold storage, packaging and modern irrigation.

Mining is another area drawing attention, particularly Tanzania’s deposits of nickel and graphite, minerals critical to batteries and clean energy technologies.

While extraction is important, opportunities are also emerging in processing and support services.

Renewable energy is expanding fast, driven by rising power demand and ESG-focused finance. Commercial solar installations and mini-grids for tourism and remote communities are among the fastest-growing segments.

Tourism, long a pillar of the economy, is also evolving.

The government wants to attract eight million visitors a year by 2030, but investors see gaps in eco-lodges, hotels in secondary cities and business and conference tourism.