Tanzania’s macro-economic performance has been on a positive trajectory for the last two decades, with GDP growth increasing from 3.5 per cent in the 1990s to seven per cent in the 2000s. According to AfDB, Tanzania is one of the countries in sub-Saharan Africa that has sustained high levels of growth despite the sharp economic slowdown that has affected much of the region.
This result can be attributed to the accommodative monetary policies that have been put in place making Tanzania an attractive destination for investment. The country has also made notable improvements in social indicators, such as reduction in infant mortality and iincrease in primary education enrolment.
Additionally, the country is experiencing high population growth – from 11 million people in 1963 to around 54 million in 2018. According to current National Bureau of Statistics (NBS) projections, the growth rate is forecasted to be 1.6 million people per year. If this trend continues, there will be 67 million people in 2025 and 77 million by 2030.
By 2025, Tanzania aspires to be a middle-income economy, what does this vision offer its biggest resource – the people? Attainment of the vision by 2025 will mean increased GDP per capita from the $1,021 recorded in 2017 to $3,000; ensuring improved livelihoods for our citizens. It is also expected that higher rates of productivity will be recorded resulting in a competitive economy capable of producing sustainable growth and shared benefits for all. For the children and youth who comprise the largest portion of the population, they will have access to quality education in a learning and inclusive society.
An analysis by the Economic and Social Research Foundation (ESRF) in 2011 indicates that in order for this kind of transformation to take place, it will require that the major sector categories grow as follows between 2010 and 2025: agriculture - 6.0 per cent, industrial sector- 9.2 per cent (of which manufacturing sub-sector 13.0 percent); and the services sector - 8.0 percent.
For Tanzania to achieve its development vision; the government and the private sector will need to collaborate in order to sustain growth and ensure that benefits are felt across all communities, especially the rural population. Partnerships and diversified investments in Tanzania have the power to unlock Tanzania’s potential and trigger huge social and economic changes that will bring profound benefits to the forecasted 67 million Tanzanians by 2025. To get there, it then becomes crucial for Tanzania to attract more domestic and foreign investment by committing to deepening partnerships that will lead to attracting the right investors that can work hand in hand with the government to diversify the economy, accelerate infrastructure development, develop tomorrow’s talent, ensure healthy urbanization and better resource management that will catalyse the country’s development aspirations by 2025.
First, it is essential to increase investment in an effective way to address key bottlenecks in the economy and create more jobs; second, take concrete steps to strengthen the role of the private sector in the economy to help drive future growth; and third, ensure that all Tanzanians can share in the benefits of development through better access to education, health care and access to finance. This means creating a conducive environment for inclusive growth that lifts the living standards of all people.
Since the beginning of 2018 Stanbic Bank Tanzania has directly provided or helped raise over Sh300 billion in financing for Tanzanian clients in the agricultural, consumer, industrial, natural resources and government sectors. By strengthening its partnership with the government, Stanbic Bank and other key stakeholders are working to improve the investment and resource mobilization climate in order to ensure that Tanzania realizes its socio-economic aspirations by 2025.
Manzi Rwegasira is Acting Head of Corporate & Investment Banking, Stanbic Bank Tanzania.