The future of infrastructure lies in our capital markets

DAR ES SALAAM: IMAGINE an economy where goods move faster than delays, where cities connect seamlessly and where opportunity is not limited by distance.

This is not a distant dream; it is the direct outcome of deliberate investment in infrastructure. For Tanzania, the question is no longer whether infrastructure matters, but how boldly we are willing to finance its future.

A healthy economy is one that prioritises infrastructure development. Roads, railways, ports and energy systems are not just physical assets; they are economic enablers.

When infrastructure is well developed, it unlocks productivity, reduces costs and accelerates the movement of people, goods and services.

The ripple effects are felt across every sector of the economy. The country has already begun to witness these benefits. The completion of the Standard Gauge Railway (SGR) from Dar es Salaam to Dodoma stands as a powerful example.

It has significantly improved mobility, reduced travel time and lowered transportation costs. Businesses can now move goods more efficiently and citizens can travel with greater convenience. This is infrastructure translating directly into economic value.

Building on this progress, the SGR also presents a bigger question: What if such networks were expanded further across the country? Imagine the economic transformation if routes like Dar es Salaam to Songea, Dar es Salaam to Tunduma, or Moshi to Arusha were connected through modern rail systems.

The potential for trade expansion, regional integration and inclusive growth would be immense. However, ambition must confront reality.

Infrastructure projects require significant capital investment and government resources alone are often insufficient to meet these demands.

This is where a shift in thinking becomes critical. Instead of relying predominantly on traditional financing methods, Tanzania must increasingly leverage its capital markets to fund longterm infrastructure projects.

Encouragingly, there are already promising examples. Instruments such as the Samia Infrastructure Bond and the Tanga’s UWASA Green Bond have demonstrated that capital markets can play a meaningful role in financing development. These initiatives have opened the door, but the pace of expansion remains slow.

This leads to an important question: Why are there still so few infrastructure instruments listed on the Dar es Salaam Stock Exchange (DSE)? Is it due to limited investor appetite, or are there structural and regulatory barriers that need to be addressed?

Understanding this gap is essential if Tanzania is to fully harness the power of its financial markets.

Expanding infrastructure instruments on the DSE would offer multiple benefits. For investors, it provides an opportunity to participate in nation-building while earning stable, long-term returns. For the government, it reduces the pressure on public finances.

For the economy, it creates a multiplier effect, enhancing productivity, enabling business growth and improving the overall quality of life.

To unlock this potential, collaboration is key. Policymakers, regulators, financial institutions and investors must come together to create an enabling environment.

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This includes strengthening regulatory frameworks, improving investor awareness and ensuring transparency and performance tracking of existing instruments. Lessons from past issuances should guide future innovation.

For this to happen, we need to review our investment policies to allow pension funds to increase their participation in registered infrastructure instruments.

We can also borrow a leaf from countries that are ahead in this area, including South Africa.

In the end, the real opportunity lies not just in building infrastructure, but in building systems that sustainably finance it. A forward-looking economy does not wait for resources; it creates pathways to mobilise them.

Tanzania stands at such a crossroads. We need to transform constraints into catalysts for innovation. If we are to unlock the next phase of economic growth, we must move decisively to deepen our capital markets and expand infrastructure financing instruments.

The future we envision will not be built by ambition alone, but by the structures we choose to finance today.

The capital market is the right platform to bridge the infrastructure financing gap as we move toward Dira 2050.