How Tanzania can become the powerhouse of Africa

Dar es Salaam port

For centuries, trade across the Indian Ocean has linked East Africa, the Arabian Peninsula, and Asia.

Over the last decade, the economic expansion of China and India as well as substantial investments from Arabian countries like Saudi Arabia and the UAE have positioned this trade route for further exponential growth.

 However, a crucial question emerges: which African country will lead the charge from the continent in the coming years?

This opportunity lies with Tanzania. With more neighboring countries and a larger population than any other African nation along the Indian Ocean, Tanzania is well-positioned to extend its influence even further.

Presently, Tanzania's largest trading partners in terms of import value are already China, the UAE, India, and Saudi Arabia. Projections indicate Tanzania’s population will increase by over double to 135 million people by 2050.

While rapid population growth can pose significant challenges, Tanzania's impressive GDP per capita growth of over 40 percent in the past decade suggests it is managing to grow overall worker productivity.

 In contrast, countries like Nigeria have experienced high population growth rates but witnessed GDP per capita decline by 30 percent over the same period.

Tanzania's stable governance, coupled with its rapid economic and population expansion firmly positions the nation to become a Pan-African superstar, surpassing more globally recognized regional countries such as Kenya and South Africa, who are currently facing significant economic and political setbacks.

However, for Tanzania to achieve its Pan-African superstar status, it must take bold steps. Recognizing the substantial gains Tanzania stands to generate in supplying its eight neighboring countries, it should lead in advocating for and implementing the Africa Continental Free Trade Agreement (AfCFTA).

To attract international investment necessary for infrastructure upgrades and private sector growth, Tanzania must reduce barriers to investment in the country.

This could begin with simple measures like aligning the $250 business visit visa with the $50 fee for an ordinary visa, which otherwise heavily discourages visits from international investors and entrepreneurs.

More importantly, Tanzania should follow through on implementing the African Union Protocol on Free Movement of Persons, which it signed in 2018.

This grants African citizens visa-free entry to all African countries, equal employment opportunities without discrimination, and the right to long-term residence in any African country.

While this might sound wildly ambitious and unrealistic, the European Union provides a tangible example.

Despite significant cultural and income differences among its 27 member countries, the EU has successfully implemented similar freedoms for its citizens.

This approach has created a dynamic pool of talent that benefits all EU countries, enabling even relatively less affluent nations like Poland to benefit from businesses and services across Europe while boasting an unemployment rate below 3 percent.

If Tanzania led the implementation of the protocol, it could rapidly attract exceptional talent from across Africa to boost local firms while generating significantly more jobs for its own citizens.

Lastly, Tanzania must leverage the potential of its diaspora. Remarkably, Tanzania is one of only seven African countries that do not allow dual citizenship.

This a self-imposed disadvantage that restricts Tanzania from benefiting from the skills and resources of some of its most successful and affluent individuals, who may have obtained passports from their countries of residence.

By permitting dual citizenship, Tanzania could quickly receive billions of dollars in additional investment and an influx of world-class talent from the returning diaspora, ready to play a pivotal role in helping the nation achieve its Pan-African leadership potential.

Tanzania has a unique opportunity to become a frontrunner in the fast-growing region of the Indian Ocean. With its strategic location, burgeoning population, stable governance, and impressive economic growth, it has the potential to emerge as a true Pan-African powerhouse.

By embracing initiatives such as the AfCFTA, the African Union Protocol on Free Movement of Persons and dual citizenship, Tanzania can attract international investments, foster regional integration, and harness the talents of its diaspora.

The path to leadership requires bold actions and a commitment to creating an environment that attracts both domestic and international stakeholders.

With the right strategies in place, Tanzania can pave the way for a prosperous future, positioning itself as a dynamic force driving the economic and social transformation of the entire Global South.

Daniel Yu is the founder and CEO of Wasoko which  is Africa’s largest B2B e-commerce network & the official private sector ambassador for Silicon Zanzibar