Tanzania Sets Out to Save Over 2.8 Trillion Shillings by Boosting Local Production
By Jacob Mosenda, Senior Journalist, The Citizen
Mwananchi Communications Limited, Dar es Salaam
Tanzania is positioning itself to cut imports and save more than 2.8 trillion Shillings annually as the government accelerates an ambitious industrialisation push aligned with the first phase of Dira ya Maendeleo 2050, the nation’s long-term development plan slated to begin next year.
The plan, unveiled by Prof. Kitila Mkumbo, the Minister of State in the President’s Office (Planning and Investment), marks a significant shift in the country’s economic strategy. It aims to strengthen domestic manufacturing, recalibrate investment incentives, and address the rising unemployment among young people.
Speaking to reporters in Dar es Salaam on Monday, December 8, 2025, Prof. Mkumbo said the government has identified eight priority products from a list of 96 items worth 15 trillion Shillings that were imported in 2024. The next step is to collaborate with investors to produce these goods locally.
Our target is to save 2.8 trillion Shillings by substituting imports with locally produced goods, he stated. “From next year, Tanzania will no longer rely on sugar imports. Instead, we will seek export markets for any surplus.”
Sugar and edible oil appear at the top of the priority list. While Tanzania already operates processing facilities for sunflower oil, it still faces shortages of raw materials. “The challenge isn’t processing capacity,” Prof. Mkumbo explained. “It’s securing enough raw materials. Therefore, new investments must include contractual farming arrangements, akin to those used in the sugar sector.”
Other targeted imports include wheat, dairy and beef products, as well as fish from deep-sea and cage-based aquaculture. Tourism and real estate development are also highlighted, with plans to rejuvenate urban centers such as Vingunguti, Manzese, and Buguruni via public-private partnerships. The goal is to replace aging infrastructure with modern commercial and residential facilities.
The strategy seeks to shift Tanzania from a consumption-driven economy to a production-led model, boosting exports and stabilising foreign exchange earnings.
Improving the investment climate
To mobilise the required level of private-sector participation, Tanzania is overhauling its investment environment. The government is strengthening the One-Stop Facilitation Centre to ensure investors can obtain permits and registrations in a single, authoritative process.
TISEZA (the Tanzania Investment and Special Economic Zones Authority) now manages a national land bank of 170,176 hectares, including 78,444 hectares of large farms designated for agricultural investments. Prof. Mkumbo noted that land availability for investment has substantially improved. “Anyone with a large farm can now submit it to TISEZA, which will secure investors for joint development.”
Currently, Tanzania hosts 34 Special Economic Zones spanning 22,623 hectares, with more in the pipeline as the government works toward a national investment platform and quarterly investor sessions to rapidly resolve bottlenecks.
Projects will be prioritised based on job creation, export potential, and value addition, with particular emphasis on mining where policy requires domestic processing before exports.
Expert perspectives
Economist Prof Benedict Mongula called the plan “logical and overdue,” but cautioned that its success depends on investor confidence. “Private sector involvement must be central,” he said. “The government must create a predictable, transparent, and cost-effective environment. Investment flows when confidence is strong.”
Industrial policy analyst Dr. Neema Laurent argued that the Sh2.8 trillion target is achievable only if structural weaknesses are addressed. “Massive investments are needed in agricultural technology, logistics, and skills development,” she noted. “Without that, factories will continue to face raw-material shortages.” She added that the policy’s real test lies in its impact on youth unemployment, a critical socio-economic challenge for the country.
A direct response to youth unemployment
With more than 900,000 young Tanzanians entering the job market every year and only a small portion securing formal employment, youth inclusion is now a top priority.
Prof. Mkumbo acknowledged the gap and outlined a plan to actively involve young people in the government’s economic agenda. A new youth investment program will be launched within EPZA zones, offering technical training, enterprise incubation, and access to seed capital.
The government has allocated 340 acres in Nala (Dodoma), Bagamoyo, Pwani, Mara, and Ruvuma for young graduates—particularly those from technical universities—to launch manufacturing ventures.
“We want to shift the mindset that employment exists only in government,” he asserted. “Young people will be supported to form companies, secure land, and connect with industrial investors.” Financial institutions have already agreed to participate.
Stability and long-term confidence
Prof. Mkumbo stressed that political stability underpins investment, adding that Tanzania’s recent volatility would be managed. “Every nation faces tough moments. The aim is to overcome them and remain a united country.”
As the country implements Dira 2050, the import-substitution drive represents more than an economic reform—it signals a redefinition of Tanzania’s development model. Whether success follows will depend on investor trust, policy consistency, and the ability to leverage the dynamism and creativity of the nation’s youth.
The bottom line is clear: Tanzania seeks to become more self-reliant, produce more goods domestically, reduce imports, and create meaningful jobs in the process.
