The United Republic of Tanzania

TANZANIA INVESTMENT CENTRE

Tanzania is a member of the Southern African Development Community (SADC) and the East African Community (EAC). Through EAC, Tanzania is a member of Tripartite Free Trade Area involving the Common Market for Eastern and Southern Africa (COMESA), SADC and EAC. This provides an enormous market opportunity targeting a population of over 600 million.


The EAC is an intergovernmental organization composed of the five republics: Rwanda, Kenya, Uganda, Burundi and the United Republic of Tanzania. The EAC was established in 1967, dissolved in 1977 and was re-established on 7 July 2000. Following negotiations with the Common Market for Eastern and Southern Africa (COMESA) and the Southern Africa Development Community (SADC) in 2008, the EAC approved an increased free trade area comprising all three organizations’ member states. EAC has a collective population of 145.5 million people, with a collective gross domestic product (GDP) of US$ 147.5 billion in 2015.


The EAC’s urban population is 19.26% and its urbanization rate averages 4.7%. Tanzania’s exports to the EAC over the years fluctuated between US$ 350 million and US$ 600 million as shown in table 3. There is more room to enhance exports within EAC and beyond. Currently, the regional market depends on imports from China and Far East countries to clothe its people. It’s safe to assume that a population of over 600 million people is a ready market for prospective investors, as it will be easier and cheaper to source clothing items regionally.


The Southern African Development Community (SADC) The SADC is an intergovernmental organization with headquarters in Gaborone, Botswana. Its aim is to advance socioeconomic integration and cooperation, along with security and political cooperation between 15 Southern African states. This is Free Trade Area with a population of over 300 million people and thus presents a huge opportunity for investors to market their products duty-free. Table 4 shows the performance of Tanzania in selling various commodities to SADC member states. An inadequate textile and garment manufacturing base in many SADC countries presents an opportunity to expand share of traded items within SADC from Tanzania, and investors will record trade growth year in, year out.


The country is eligible for the USA’s African Growth and Opportunity Act (AGOA), which offers duty-free exports to the USA from certain sectors, including textiles. The European Union’s (EU’s) Everything But Arms (EBA) initiative enables Tanzania to export some goods to the EU tariff-free. Tanzania’s special preferential tariff agreement with China allows it to export in excess of 400 products made in Tanzania to China tariff-free..

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