Tanzania has reported a record FDI inflow of US $3.5 billion for the fiscal year 2023/24. Key drivers include the liberalized investment climate, digitization of investment processes, and political stability. The Tanzania Investment Centre (TIC) is also working to simplify investor onboarding and project facilitation.
1. Historic Milestone for FDI Inflows
In the fiscal year ending June 2024, Tanzania recorded a record-breaking US $3.5 billion in foreign direct investment (FDI)—the highest annual inflow in its history. This surge significantly exceeded TIC’s original annual target, showcasing renewed investor confidence
2. Record Number of Investment Projects
During the same period, the Tanzania Investment Centre (TIC) facilitated 707 investment projects spanning multiple sectors, a sharp increase from 369 projects in FY 2022/23—an astonishing 92% jump year-over-year . Of these, 196 manufacturing projects stood out, drawing US $1.42 billion alone in the first half of 2024
3. FDI Stock and Regional Positioning
Tanzania’s cumulative FDI stock is estimated at around US $20 billion by end‑2023, growing from US $18.6 billion in 2022 . In contrast with a slight decline in Africa-wide FDI, Tanzania stands out as a bright spot on the continent .
4. What’s Driving the Boom?
- Investment-friendly reforms: The 2022 Investment Act has significantly simplified registration processes, enhanced transparency, and streamlined bureaucracy, boosting investor confidence
- Political and macroeconomic stability: A more consistent policy environment, tighter fiscal discipline (deficit fell from 4.6% to 3.0% of GDP), and a current account surplus (US $52 million vs deficit in prior year) have fortified investor sentiment tic.go.tz.
- Strategic infrastructure & resource zones: Ongoing large-scale projects—from SGR railways, hydropower plants to gas field development (e.g., Ntorya gas field licensed in 2024)—are making Tanzania a regional investment hub
- Competitive sectoral appeal: Manufacturing, energy, mining, services, agriculture, and tourism sectors have all attracted a variety of high-value projects .
5. Implications & Outlook
- GDP boost & job creation: TIC estimates expect this inflow to spur economic growth, strengthen industrialization efforts, and create thousands of new jobs.
- Infrastructure multiplier effects: Investment in energy and logistics infrastructure enhances the environment for further FDI and domestic enterprise expansion.
- Vulnerability to global trends: While promising, Tanzania must navigate global commodity price shocks and competition for capital.
