Tanzania Emerges as Key Trade and Investment Destination in Africa

Tanzania is steadily establishing itself as a crucial hub for trade and investment in Africa, driven by improved infrastructure, homegrown innovations, and a growing private sector. The country's logistics backbone is evolving, enabling goods to move efficiently within the country and across borders. According to the United Nations Conference on Trade and Development (UNCTAD), Foreign Direct Investment (FDI) in Tanzania rose by 28.3 percent in 2024, reaching $1.72 billion. At the heart of this transformation is a combination of deliberate public investment and growing private sector involvement in logistics and supply chain development.

Key Takeaways:

• Tanzania's FDI rose by 28.3 percent in 2024, reaching $1.72 billion, ranking it 11th in Africa by FDI volume and 13th by annual growth rate (UNCTAD).
• DHL's Managing Director for Supply Chain Africa and Chief Commercial Officer for the Middle East and Africa, Bremer Pauw, notes that Tanzania's logistics infrastructure is evolving, enabling goods to move more efficiently within the country and across borders.
• Agriculture stands out as a sector with immense potential in Tanzania, driven by fertile land, consistent sunshine, and a suitable climate (Pauw).
• DHL has developed an agritech packaging innovation, which originated in Tanzania, to reduce post-harvest losses and enable farmers to access global markets (Pauw).
• The solution involves allowing farmers to send samples, such as six avocados, to overseas buyers in specialized packaging that preserves freshness and allows for quality inspection (Pauw).
• Tanzania's improved transport infrastructure, including key corridors linking the country to neighboring nations, is driving growth and trade volume (Pauw).
• Challenges persist, particularly at borders, due to paperwork and a lack of digitization, which slows down the flow of goods and increases costs for traders and transporters (Pauw).
• Rail freight has significant potential in Tanzania, particularly for heavy or bulk cargo, but current corridors remain underutilized (Pauw).
• The African Continental Free Trade Area (AfCFTA) aims to create a single market for goods and services across Africa, but the on-the-ground reality must catch up to the ambition (Pauw).

Statistics:

• Tanzania's FDI rose by 28.3 percent in 2024, reaching $1.72 billion (UNCTAD).
• Postharvest losses in Africa can reach up to 40 percent for fruits and vegetables, 20 percent for cereals, and 30 percent for dairy and fish (Food and Agriculture Organisation, FAO).
• Tanzania is linked by rail to Zambia and South Africa, but these corridors remain underutilized (Pauw).

Sources:

• United Nations Conference on Trade and Development (UNCTAD)
• Food and Agriculture Organisation (FAO)
• Daily News