manufacturing-industry-in-tanzania-industry
Published

August 2016

Manufacturing industry in Tanzania: Analysis of consumption and production trends of several key industries (2004 - 2014)

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The manufacturing sector in Tanzania remains relatively small, with most activities concentrating on the creation of simple consumer products such as foods, beverages, tobacco, textiles, furniture and wood allied products. In spite of its declining size, however, the sector continues to be of considerable importance to the Tanzania economy as is still one of the most reliable sources of government revenue in terms of import sales as well as for both corporate and income taxes, accounting for over half of the annual government revenue collection.

The contribution of the manufacturing sector to the overall GDP of the country has averaged 8% over the last decade, however activities within the sector have been registering an annual growth of over 4% and the sector is currently the third most important to the Tanzania economy behind agriculture and tourism. In 1986, the Tanzania government made the decision to liberalize trade and investment policies within the country. As a result of this decision and because they could not stand up to competition from import manufacturers, many firms began to fail. Therefore, with this in mind, a number of measures were taken to increase both the competitiveness of the local industries and their ability to penetrate the export markets.

As observed from the figure above, we notice a consistent as well a positive growth in the manufacturing sector over the period 2006-2010. As of 2013, the share of MVA in GDP is estimated to be 9 percent and the share of manufactured exports of various functioning sectors is about 85 percent as of 2011.

Drivers

Key factors in the growth of Manufacturing Industry are the growing MVA per capita, MVA as percentage of GDP, share in total manufacturing employment, the emergence of new firms, products and market penetration, rising sales and revenues or business profitability, expansion in exports, increase in labor and employment and the acquisition of new product technologies.

Challenges

Slow Economic Growth due to not so consistent average GDP growth rate (i.e. fall from 8.71% in 2005-2010 to 8.26% in 2010-2013), inconsistent average MVA growth rate, technical problems, administrative issues, market challenges, financial barriers and policy issues are the biggest challenges for the Manufacturing Industry.

What the report offers

The study identifies the situation of Tanzania and predicts the growth of its manufacturing market. Report talks about the manufacturing production, consumption, import and export with prices and market trends, government regulations, growth forecast, major companies, upcoming companies and projects etc. In addition to it, the report also talks about Economic conditions of and future forecast of its current economic scenario and effect of its current policy changes in to its economy, reasons and implications on its growth. Lastly, the report is divided by major import & export and importing and exporting partners.

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