Doing business in Tanzania: Tanzania trade and export guide
Updated 26 February 2019
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This publication is available at https://www.gov.uk/government/publications/exporting-to-tanzania/exporting-to-tanzania
1. Tanzania export overview
Tanzania is the ninth largest economy in sub-Saharan Africa with a population of 49.25 million.
It has an active British Business Group (BBG). The BBG’s members are resident British nationals employed or investing in Tanzania. Their main role is networking and advocacy amongst its members.
Contact a Department for International Trade (DIT) Tanzania export adviser for a free consultation if you are interested in exporting to Tanzania.
Contact UK Export Finance (UKEF) about trade finance and insurance cover for UK companies. You can also check the current UKEF cover position for Tanzania.
UK companies already operating in Tanzania include Shell, Standard Chartered Bank, Barclays Bank, PwC, Deloitte, Unilever and Diageo.
Benefits for British businesses exporting to Tanzania include:
- efficient air transport
- English is the business language
- politically stable
- free market economy
- the Dar es Salaam port serves 8 land locked countries
- abundant natural resources
- 44 million hectares of arable fertile land
- strategic location in east Africa
2. Challenges doing business in Tanzania
Tanzania is an emerging market which is ranked low in the World Bank’s ease of doing business rankings.
The challenges of doing business in Tanzania include:
- unreliable and expensive power systems
- an underdeveloped transport system
- bureaucracy
- widespread corruption; although there is a push to eliminate corruption it’s still evident especially within government agencies, particularly in customs and tax authorities
- limited availability of skilled labour
- a new focus on local content; recent legislation has resulted in fewer jobs being open to foreigners
- restrictions on the number of foreigner visas and permits that a business can apply for
- a focus on ensuring international businesses do more joint ventures with local businesses in Tanzania
- the slow pace of decision making
- lack of technological resources
- complex land laws
You should ensure you take the necessary steps to comply with the requirements of the UK Bribery Act.
3. Growth potential in Tanzania
3.1 Economic growth in Tanzania
As of 2017, Tanzania is the fourth largest economy in sub-Saharan Africa with a population of 57.31 million according to UNCTAD.
Tanzania’s economy has been growing steadily for the past 10 years, but more recently has slowed in part due to a number of factors, including eradicating corruption.
Tanzania’s inflation rate for 2017 has reduced significantly, reaching 5.3%, down from 16% in 2012. The IMF estimates a 3.8% inflation rate for 2018, and forecasts 4.7% for 2019.
Tanzania’s domestic economy is mostly agricultural, employing about 80% of the population. However, the economy has broadened in recent years, away from reliance on agriculture.
Six sectors have contributed to the rapid economic growth.
These sectors include:
- agriculture
- construction
- communication
- energy industry
- extractive industry
- manufacturing
3.2 Tanzania’s trade agreements
The UK and Tanzania have signed an agreement for the promotion and protection of investments. This is a bilateral agreement between the 2 states, in which each provides certain protections to investments of investors from the other state. It includes a commitment not to discriminate or expropriate (take possession of private property) without compensation.
Tanzania is a member of the:
- World Trade Organization (WTO)
- Southern African Development Community (SADC) free trade area
- East African Community (EAC) and its common market and customs union
The EAC finalised negotiations for an Economic Partnership Agreement (EPA) with the EU on 16 October 2014. It has not been ratified by Tanzania and thus is not applicable.
4. UK and Tanzania trade
The UK is a large investor in Tanzania. Other large investors include those from China, India and USA.
Total trade in goods and services (that is exports plus imports) between the UK and Tanzania was £253 million in the 4 quarters to the end of Q3 2018. During this period UK exports to Tanzania were £63 million (42.3%) in goods and £86 million (57.7%) in services.
The top 5 goods exported from the UK to Tanzania in 2017 were:
- vehicles (not railway or tramway stock)
- machinery and mechanical appliances
- electrical machinery and equipment
- lead and lead articles
- furniture; bedding, mattresses, cushions
5. Opportunities for UK businesses in Tanzania
DIT provides free international export sales leads from its worldwide network. Search for export opportunities.
Contact the DIT team in Tanzania to find out more about what opportunities exist in Tanzania.
Contact DIT’s trade specialists in your region to commission services such as research or organising a visit programme for you to meet buyers, industry and government in Tanzania.
Find more information on aid funded business to help you identify opportunities to supply products and services to the international aid agencies.
5.1 Energy sector in Tanzania
Recent exploration activity in Tanzania’s deep offshore waters has led to the discovery of well over 46.5 trillion cubic feet of natural gas. There are opportunities for onshore, and potentially offshore oil development.
Opportunities for UK companies include:
- oil and gas exploration
- development, supply and construction of Liquefied Natural Gas (LNG) plants
- supply of services, skilled labour or equipment for the development and construction of the proposed 1,400km Uganda / Tanzania East Africa Crude Oil Pipeline (EACOP)
Tanzania’s power sector is growing. Projects include the:
- proposed construction of 2 new coal fired powered plants
- development of small to medium hydro schemes
- expansion of the gas power network, and associated transmission / distribution grid reinforcement and new build
Renewable energy is in its infancy in Tanzania with opportunities in:
- geothermal
- onshore wind
- biomass
- small and large-scale solar
Contact the DIT team in Tanzania to find out more about energy sector opportunities in Tanzania.
5.2 Mining sector in Tanzania
Tanzania is resource rich in terms of minerals. However, there are strict regulations and laws about exploring, operating mines and the processing of the raw materials in Tanzania.
Large mining projects include:
- gold, iron, silver, copper, platinum, nickel and tin in the north of the country
- high quality graphene in the south of the country
- rare earths in the west
There are small and medium scale mines for gemstones such as diamonds, tanzanite, ruby, garnet, emerald, alexandrite and sapphire.
Other resources include:
- the large deposits of coal
- large reserves of helium
- uranium
There are opportunities whether directly mining or on the supply side.
Contact the DIT team in Tanzania to find out more about mining sector opportunities in Tanzania.
5.3 Information and Communications Technology (ICT) sector in Tanzania
The ICT sector has grown by more than 10% per year over the last 5 years. However, Tanzania has a limited fibre-optic network and affordable telecom service. Demand for communication services like fixed-line, broadcast and data are growing at a rate of more than 50% per year.
Opportunities for UK companies include:
- extending the fibre-optic network
- provision of ICT hardware
- education and training
- systems to support information flows
Contact the DIT team in Tanzania to find out more about ICT sector opportunities in Tanzania.
5.4 Agriculture sector in Tanzania
Agriculture is the biggest sector in the Tanzanian economy. It accounts for about half of national income. There is a huge availability of arable land and labour force.
Opportunities exist for UK companies in:
- agro-processing
- machinery manufacturing
- irrigation infrastructure development
- production of flowers, fruits and vegetables
- production of traditional ‘cash crops’ such as coffee, tea, pyrethrum, cashew, sugar, cotton and sisal
Contact the DIT team in Tanzania to find out more about agriculture sector opportunities in Tanzania.
5.5 Education sector in Tanzania
Education is a continuously developing sector and contributes significantly to the Tanzanian economy. There is a need to develop the sector to meet worldwide standards.
Opportunities exist for the:
- construction and operation of education establishments
- supply of learning materials
- provision of corporate training
Contact the DIT team in Tanzania to find out more about education sector opportunities in Tanzania.
5.6 Financial services sector in Tanzania
The financial sector is one of the fastest growing sectors in Tanzania. There are a number of local and international banks operating within the country.
Opportunities are available for UK organisations throughout the sector.
Contact the DIT team in Tanzania to find out more about financial services sector opportunities in Tanzania.
5.7 Security sector in Tanzania
This sector is steadily growing with demand for:
- security services
- patrol vessels
- basic utility and training aircraft
- improved maritime situational awareness
- training on military skills
- training for criminal investigation and prosecution
The Export Control Joint Unit (ECJU) issues licences for the export of strategic goods. You must check your goods you are meeting legal requirements for export.
Contact the DIT team in Tanzania to find out more about agriculture sector opportunities in Tanzania.
6. Start-up considerations in Tanzania
There are several ways in which British companies can enter the Tanzanian market.
You can:
- export directly
- set up an agency
- appoint a distributor
- establish a joint venture
- sell to the government
You are advised to employ a local agent on commission basis if you want to export directly to Tanzania. An importer or distributor is also recommended, depending on the nature of the business.
Find out how to register a business in Tanzania on the Tanzania Investment Centre website for how to go about registering. Assistance from a local lawyer may be necessary.
Tanzania is a member of the East African Community and adheres to most international business standards.
Contact the DIT team in Tanzania to help find tax and legal advisers, and for help on setting up an office or business in Tanzania.
7. Legal considerations in Tanzania
Rules and regulations around land ownership are complex and ambiguous. You should undertake professional advice, particularly when procuring land for business.
Contact the DIT team in Tanzania to help find tax and legal advisers.
7.1 Standards and technical regulations in Tanzania
The Tanzania Bureau of Standards deals with labelling, packaging and technical regulations.
7.2 Intellectual Property Rights (IPR) in Tanzania
Several general principles are important for effective management of IPR in Tanzania:
- it is important to have an overall strategy to protect IPR
- IPR is protected differently in Tanzania than in the UK
It is vital that you understand that intellectual property rights in Tanzania are primarily private rights. Rights must be registered and enforced in Tanzania under local laws. The UK government generally cannot enforce rights for private individuals in Tanzania.
It is advisable to work with legal counsel who are familiar with Tanzanian laws.
The DIT team in Tanzania can provide list of local lawyers upon request.
8. Tax and customs considerations in Tanzania
All information about taxes and customs in Tanzania is available from the Tanzania Revenue Authority (TRA). There are no derogation from the rules.
9. Business behaviour in Tanzania
Swahili is the official language in Tanzania although English widely spoken.
Swahili is the most widely used language and is becoming more common in business, although English is generally still considered to be the official language of business.
10. Entry requirements for Tanzania
All British passport holders need a business visa to enter Tanzania for the purpose of temporarily conducting activities such as: business, trade, professional assignment for period not exceeding 3 months.
Obtain a visa from the Tanzanian High Commission in London before you travel.
If you intend to work in Tanzania you will need a valid work permit. Your employer or volunteer organisation should arrange this before you travel.
If you’re travelling to Tanzania for business, check the Foreign and Commonwealth Office (FCO) travel advice first.
11. DIT contacts for Tanzania
Contact a local DIT trade adviser in the UK if you are interested in finding out more about doing business in Tanzania.
Contact the DIT team in Tanzania for more information and advice on opportunities for doing business in Tanzania.