Tanzania - Market OverviewTanzania - Market Overview
For U.S. exporters and service providers interested in exploring commercial opportunities in sub-Saharan Africa, the Tanzanian market should be considered for the following reasons:
Tanzania has averaged 6 to 7 percent real GDP growth since the late 1990s. In 2014, the Tanzania National Bureau of Statistics (NBS) revised the national accounts using 2007 as a base year, revealing a more sizable economy with a 31.4 percent larger 2013 GDP than previously calculated. Growth has been driven primarily by transportation, communication, agriculture, manufacturing, electricity, wholesale and retail trade, real estate, and business services. The IMF projects the economy will continue to grow around 7 percent in the medium-term as both public and private investment accelerates and lower inflation boosts consumption. Inflation has continued to decline due to consistent crop production, lower food prices, and lower petrol prices. The NBS reported that overall inflation in February 2015 decreased to 4.2 percent compared to 6.0 percent the previous year. Most recently, inflation increased to 5.3 percent in May of 2015, which is still down from the previous year.
The Tanzania shilling (TZS), which had maintained a relatively stable value from mid-2011 to mid-2014 against the U.S. dollar, began to gradually depreciate in October 2014. In January, the depreciation accelerated, and the TZS dropped 18 percent in four months, from TZS 1,708 on December 31, 2014 to TZS 2,015 on May 1, 2015. While economists generally consider the shilling to be a weaker currency due to a lack of exports to bolster demand, the rise in value of the U.S. dollar has also played a significant role in its depreciation. According to the Bank of Tanzania (BOT), the current account deficit in 2014 widened 1.3 percent to $4.75 billion and was due to the decline in current transfers to the government by 63.4 percent to $177.8 million from the amount recorded in 2013 (source found here).
Overall, the partner states that make up the East African Community (EAC) – a regional intergovernmental organization consisting of Burundi, Kenya, Rwanda, Tanzania, and Uganda – registered 6.2 percent growth in 2004-2013 (source: World Economic Outlook, IMF). The average inflation for the EAC in the second quarter of 2015 was 4.5 percent. Tanzania’s main trading partners are China, India, the European Union (EU) and neighboring Southern African Development Community (SADC) and EAC countries. Tanzania’s exports to the United States are dominated by agricultural commodities, minerals, and textiles while imports from the United States include wheat, agricultural and transport equipment, chemicals, used clothes, and machinery.
Basic Economic Statistics (2013/2014 figures):
Real GDP growth in 2014: 7.0 percent
Nominal GDP – 2013 (current) $33.23 billion
GDP per capita – 2013: $695
Consumer price inflation: Declined from 9.8 percent in March 2013 to 4.3 percent in March 2015.The core rate, which is the rate without energy and food prices declined from 6 percent in March 2013 to 2.5 percent in March 2015.
Total Exports: $4,413 million for 2013
Total Imports: $12,525 million for 2013
Exports to the USA: $70 million
Imports from the USA: $420 million
Exchange rate: Tanzanian shilling depreciated against $ from TZS 1,708 on December 31, 2014 to TZS 2,015 on May 1, 2015.
Average lending rate on short term loan: 13.66 percent (April 2015)
Population Total: 47.4 million (2015 projection)
National Bureau of Statistics – Tanzania
Bank of Tanzania
Tanzania has abundant natural resources with productive use implications for agriculture, mining, energy, and tourism. The country has 44 million hectares of arable fertile land with only about 21 percent currently under cultivation. Resources include diamonds, gemstones, gold, coal, iron, nickel, forest products, domesticated livestock, wildlife, fishers and marine resources, natural gas, and possibly oil. Primary exports in terms of value include gold and tobacco, while key imports are capital and consumer goods.
Most of Tanzania’s land mass consists of the inland plateau rising gently from the coastal belt and stretching 1,000 kilometers, with three major islands along the Indian Ocean – Unguja and Pemba (which makeup Zanzibar) and Mafia. These great East African lakes—Victoria, Tanganyika and Nyasa—are partly within Tanzania. The country has the African Rift Valley with impressive natural features including the Ngorongoro crater and Lake Manyara, Mount Kilimanjaro (the highest peak in Africa) and several rivers and streams with clean water and hydroelectric potential.
Tanzania Trade Development and Promotion