An Overview of

the Investment
Climate
&
Investment
Potentials in
Tanzania
WHY INVEST IN TANZANIA?

TANZAN
IA

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Tanzanias Advantages:

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TANZANIAS ECONOMIC OVERVIEW
Population: Annual Average Real
44.9 Million GDP Growth Rate
(2012.) 7.0% (2003 - 2012)
Population Growth
Rate 2.7 Annual Average
%(2012 ) Inflation Rate 8.6 %
(2003 -2012)

GDP Per Capita Agriculture Employs

$ 652 (2012) 80% of the Workforce

Main imports:
Capital goods (i.e.. machinery and equipment),vehicles, petroleum
products, agricultural inputs, raw materials and other consumer goods

Main exports:
Agricultural products,(such as cashew nuts, tea ,coffee, cotton),cut
flowers & vegetable, minerals, fish and manufactured goods.
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<1>. GOVERNMENTs COMMITMENT
FOR
INVESTMENTS & PRIVATE SECTOR
DEVELOPMENT

H.E Dr. Jakaya Mrisho Kikwete

President
United Republic of Tanzania

H.E Mizengo K.P Pinda (MP) H.E Dr. Mary M. Nagu (MP)
Prime Minister Minister of State
United Republic of Tanzania ( Investment & Empowerment )

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The Government is committed to economic
growth
through
Ever private
since the mid 1990s Tanzania sector
has development
followed a path of liberalisation and Enforcing Contracts (Doing Business Index 2012)
Ranking of Sub-Saharan African countries
privatisation. It has welcomed foreign
investment and managed to attracted
more FDI than Kenya or Rwanda,
particularly in areas such as agriculture,
tourism, mining and FMCG
The government is continuing to pursue
Public Private Partnerships (PPP) for
infrastructure, agriculture, energy and
other strategic investments. Privatisation
and modernisation of key assets is a main
focus area
Foreign Direct Investment (FDI), USD billion,
Policies and laws defining incentives for
2000-2010
investment are continuously being updated
and improved
Relative to the rest of Africa, Tanzania
continues to be competitive in the World
Banks Doing Business Index. In the
category enforcing contracts Tanzania is
the best performing country in Sub-
Saharan Africa
Source: World Bank; Doing Business Index 2012;
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<2>.
<<1>> Tanzania:
Tanzania is one of Governance
the most open and
stable democracies in Africa
& Political Stability
Tanzania is a stable, multiparty Ranking of countries in Mo Ibrahim
democracy with a Competent Executive Governance Index, 2011, (Sore/100)
under President, Democratic Parliament
and An Independent Judiciary.

Presidential elections are held every 5

years. The current President will be
stepping down in 2015, followed by the
tradition of free and fair elections between
different candidates and parties

Became independent in the early 1960s.

Since then, we been without civil wars or Ranking of countries in Global Press
ethnic rivalries. High Observant to Good Freedom Index, 2011, Rank
governance practices and Freedom of
Expression where; Media, Civil Societies
and opposition parties are able to operate
freely and challenge the ruling party openly.

According to Transparency International,

Tanzania ranks as one of the least corrupt
countries in the region
Source: Mo Ibrahim Foundation, Press Freedom Index 2011
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<3>. Tanzania: fastest
growing

Economy
With GDP growth averaging 7% per year, Tanzania is
one of the fastest growing economies in East Africa
Other growth indicators over the last decade:
The number of tourists to Tanzania has grown by
more than 70% to 780,000
Consumption expenditure has grown by 96%
The number of cell phone subscribers has
increased from 110,000 to 21 million
FDI of more than US$5billion was invested in the
countries booming agriculture, mining, FMCG
and other industries Dar es Salaam

Number of tourists visiting Tanzania, thousands

Average annual GDP growth, %, 2001-2010

+175%

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Source : World Bank
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<4>. Predictable Fiscal
Due Investment
to its Predictable Fiscal InvestmentRegime
Regime, there is increasing number of
foreign direct investments in the country. Meanwhile, economic and structural
reforms have led to substantial progress in establishing a functioning market
economy, making it among the Top 10 fastest-growing economies in the world.

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<5>. Tanzania Ranked
as #1 Investment
Destination for
Corporates in the EAC

Source: RMB Global Markets Data September 2013

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Trend of FDI flows into
East African Countries
(US $ Million)

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<6> Tanzania is among Top
10 Most
Attractive Investment
Destinations in Africa...

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 < 7>. Countrys
Statistical Potentials
based on the World
Investment Trends

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World Investment Trends
contd..........

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 World Investment
Trends contd..........

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FDI in East African Countries

(US $ Miln)
 <9>. ACCESS TO
POTENTIAL
Tanzania MARKETS
enjoys Preferential Market Access
with; Negotiated EPA
SADC
(About 300m with European
People) Union

EAST AFRICA AGOA (USA)

COMMUNITY Africa Growth
and
(About 130M Opportunity Act
People) Over 6,000 items

China Japan, Canada

(Over 4,000 etc
Items)
3 MAJOR PORTS; GATEWAY TO SIX (6) LAND-LOCKED
COUTRIES
(Uganda, Rwanda, Burundi, DR Congo, Zambia & Malawi) 17
 INVESTMENT
OPPORTUNITIES IN
TANZANIA:

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 Where does TIC
come in....
WHERE TIC COMES IN...

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 As Tanzanias investment promotion agency,
TIC offers a range of services to investors
TIC Overview
The Tanzanian Investment Centre (TIC) was established
by the Act of Parliament No 26 of 1997. The Centre
Operates as a Semi-Autonomous Institution under the
Prime Ministers Office (PMO).
TIC is the primary Agency of the Government
established with the Mandate to Coordinate, encourage,
promote and facilitate investment in Tanzania.
It is an instrumental institution to advise the
Government on the investment policy and investment
related matters
Vision:
To become a premier Investment Promotion Agency (IPA)
capable of creating and sustaining ever-increasing
investment flows in an attractive and competitive
environment that promotes Tanzania as the prime
investment destination of choice in Sub-Saharan Africa
Mission:
To contribute to the sustainable economic development
of Tanzania through attraction on new investment and
maximizing its impact on the economy Executive Director,
TIC
Source: TIC Database.
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 As Tanzanias investment promotion agency,
TIC offers a range of services to investors
TIC as Investors One-stop-centre
The Tanzanian Investment Centre (TIC) provides a
one stop-facilitation-shop to investors, offering a
range of services that includes but not limited to;
Promotion of Investment Opportunities
Facilitation Services for Investment activities
After Care Services to Investors
Linkage With Other Economic Blocks e.g: EAC,
International Awards by TIC:
SADC
Senior officers from key Government Ministries,
2005 - Best Investment
Departments and Executive Agencies have been
Promotion Agency in Sub
permanently stationed at TIC. These are those
Saharan Africa (By Africa
from;
Investor Platform)
Ministry of Lands & Settlement Development 2006 - Best country of the
Ministry of Industry and Trade (MIT) future (By Financial Times)
Business Registration & Licensing Agency 2007 - Best Investment
(BRELA) Promotion Agency in the world
Tanzania Revenue Authority (TRA) (by UNCTAD/WAIPA)
2008 - Gold Award for
Ministry of Home Affairs - Immigration
Department Innovative Management in
Africa ( By AAPAM) 3
Ministry of Labour
Source: TIC Database. 21
INVESTMENT FACILITATION
Senior Government officials from the following
SERVICES:
Ministries/Government Departments have been
stationed at TIC to assist investors to obtain
various licenses and permits they need in order
to start business.

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INVESTOR WINDOWS FOR
FISCAL INCENTIVES:
A) Priority Sector Projects
Receive Fiscal Incentives through TIA Act 1997,

B) PPP Projects
Receive Fiscal Incentives through PPP Act 2010,

C) Specialized EPZ related Projects

Receive fiscal incentives through Specific laws (e.g. EPZ/SEZ
etc.)

D) Other Projects (Above the land)

Receive Fiscal Incentives through Tanzania Investment Act 1997

E) Mining, Energy & Gas Sector Projects (Below the land)

Receive fiscal incentives through the Ministry of Energy and
Minerals

F) Service Sector Projects

Do not receive fiscal incentives but can access Non-fiscal
Incentives upon registration through TIC

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 Incentives under the
Tanzania Investment Act:
Financial
Financial
Incentives
Incentives Exemptions
Exemptions on on Projects
Projects capital
capital goods;
goods;
i)i) Import duty 0%
Import duty 0%
ii)
ii) Value
Value added
added tax
tax 0%
0%
Tax
Tax Relief
Relief on on Deemed
Deemed capital
capital goods;
goods;
i)i) Import
Import duty Exempted by
duty Exempted by 75%
75% (Pay
(Pay 25%)
25%)
ii)
ii) Value added tax Reduced from 18% to
Value added tax Reduced from 18% to 10%
10%

Capital
Capital allowance
allowance
i)i) Agriculture
Agriculture 100%
100%
ii) Mining -
ii) Mining - 100%100%
iii)
iii) Manufacturing
Manufacturing 50%
50%
iv) Fish farming -
iv) Fish farming - 50% 50%
v)
v) Tourist
Tourist services
services 50%
50%
vi)
vi) Hotels
Hotels -- 50%
50%
Depreciation
Depreciation Allowance:
Allowance:
Ranging
Ranging from 37.5%
from 37.5% to
to 50%
50% depending
depending on
on the
the class
class of
of
the depreciable asset.
the depreciable asset.

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 Incentives
Automatic
under the
Automatic Immigration
Immigration Quota:
Quota: of
of up
up to
to 55 expatriates
expatriates at
at
Tanzania
the Investment
the initial
initial
project)
project)
stage
stage of
of the
the projects Act:
projects (depending
(depending on
on nature
nature of
of the
the

Non-Fiscal
Non-Fiscal
Incentives:
Incentives: Unconditional
Unconditional transferability
transferability ofof funds:
funds:
Net
Net profits
profits or
or dividends
dividends of
of the
the investment
investment
Payment
Payment inin respect
respect of
of foreign
foreign loans
loans
Remittance
Remittance of of proceeds
proceeds net
net of
of all
all taxes
taxes and
and other
other
obligations
obligations
Royalties
Royalties fees
fees and
and other
other charges
charges
Payment
Payment ofof emolument
emolument and and other
other benefits
benefits to
to foreign
foreign
personnel
personnel
Note:
Note: The
The transactions
transactions must
must be
be through
through any
any authorized
authorized
dealer
dealer bank
bank and
and in
in freely
freely convertible
convertible currency.
currency.
Protection
Protection against
against Non-Commercial
Non-Commercial Risks:
Risks:
Tanzania
Tanzania in
in aa Member
Member of
of MIGA
MIGA (Multilateral
(Multilateral Investment
Investment
Guarantee
Guarantee Agency,
Agency, AA Scheme
Scheme under
under the
the World
World Bank)
Bank)
and
and IISD
IISD

Protection
Protection against
against Nationalization/Confiscation:
Nationalization/Confiscation:
Incase
Incase of
of change
change of
of policy,
policy, TIC
TIC registered
registered projects
projects can
can
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 Incentives under the
Tanzania Investment Act:
Strategic
Strategic In
In addition
addition toto existing
existing investment
investment incentives
incentives aa potential
potential investors,
investors,
Investor
Investor with
with projects of specific/great impact to the society or economy may
projects of specific/great impact to the society or economy may
Status
Status apply
apply forfor aa strategic
strategic investor
investor status
status to
to seek/request
seek/request additional
additional
investment
investment incentives from the Government, as provided for in
incentives from the Government, as provided for in Rule
Rule
49
49 of
of the
the Tanzania
Tanzania Investment
Investment Regulations
Regulations 2002.
2002.
Criteria
Criteria used
used to to award
award Strategic
Strategic Investor
Investor status
status considers
considers the the
following:
following:
The
The amount
amount of of capital
capital to
to be
be invested
invested (normally
(normally above
above UDS
UDS 2020
million);
million);

The
The contribution
contribution of
of the
the project
project in
in terms
terms of
of creating
creating employment
employment
opportunities;
opportunities;

New
New and
and innovative
innovative technology
technology to
to be
be introduced
introduced by
by the
the Prospective
Prospective
investors
investors strategic
strategic project;
project;

The
The extent
extent to
to which
which the
the Project
Project brings
brings capacity
capacity to
to manufacture
manufacture
products
products for
for export
export and
and the
the earning
earning of
of foreign
foreign exchange;
exchange;

Whether
Whether the
the Investment
Investment is
is in
in the
the Special
Special Economic
Economic Zone
Zone or
or
Geographically
Geographically disadvantaged
disadvantaged regions.
regions.
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 Incentives under the
Tanzania Investment Act:
Import
Import Duty
Duty
Draw Refund
Refund of
of duty
duty charged
charged onon imported
imported inputs
inputs used
used for
for producing
producing
Draw Back
Back
Scheme goods
goods for export and sold to foreign institutions like UN and
for export and sold to foreign institutions like UN and its
its
Scheme
agencies
agencies operating
operating in
in Tanzania
Tanzania

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 INVESTOR FACILITATION
SERVICES:
NATIONAL INVESTMENT STEERING
COMMITTEE (NISC)
In an effort to improve the business environment and foster
economic growth through increased investment the Government
formed a National Investment Steering Committee chaired by the
Hon. Prime Minister.

Other members of the committee are Minister of Finance, Minister

of Industry and Trade, Minister of Agriculture, Minister of Lands,
Minister for Investment and Empowerment, Attorney General,
Governor of the Bank of Tanzania and the Executive Director TIC
(Secretary).

This committee is entrusted with the role of investment policy

formulation and solving problems of investors on a fast track
basis.
 ACQUISITION OF LAND
FOR INVESTMENTS:
Foreign investors can obtain land for investment
through Tanzania Investment Centre, where
Derivative Right is granted.

Two main ways by which investors can obtain/

access land for investment:

A) To apply for land acquisition from the village,

and then follow all the necessary steps required,
until the land is transferred from village land to
general land and given to TIC in order to prepare
a Derivative Right for the investor.
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 ACQUISITION OF LAND FOR
INVESTMENTS:
B) To purchase a parcel of land from
individuals/ Companies:
- Once the buyer and a seller have agreed upon the
price, the seller is required to surrender the land
tittle to the Commissioner for Lands in order to re-
issue in the name of TIC, which will eventually
prepare a Derivative Right for an investor.

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 ACHIEVEMENTS OF TIC
EFFORTS:
FDI INFLOWS TO TANZANIA FROM
2007 2012 (US$ Mill)

Source: UNCTAD - World Investment Report 2013

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 TREND OF PROJECTS REGISTERED
WITH TIC
FROM 2005 TO 2012
Number of Projects

Years
Source: Tanzania Investment Centre Database, 2013

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 Distribution of 896
Investment Projects
registered at TIC in
2012 (per sector)

Source: Tanzania Investment Centre Database, 2013

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TOP TEN (10) LEADING COUNTRIES WITH
REGISTERED INVESTMENTS IN TANZANIA
(BY VALUE OF Million US$) FROM 2006 -
2012

Source: TIC Database, 2013

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China Investment Trends in Tanzania:
.488 Projects Registered at TIC
.$2.393 Billion in value
.76, 201 Jobs created thus far

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Number of Chinese
Projects in Tanzania
Distribution of Chinese Projects
by percentage (%)
Chinese Investment Projects by
Value (Millions USD):
Number of Jobs created by
Chinese Projects
(per sector)
 Jobs created by Chinese
projects per sector (in %)
OUR COMMITMENT TO INVESTORS

Application Maximum Time

taken

Company Registration 3days

Industrial License 1day
Business licensing 1days
Certificate of incentives 7days
Resident Permit Class A 14days
Resident Permit Class B 14days
Special Pass 1day
 OUR COMMITMENT TO INVESTORS

Application Maximum Time

taken

Meeting with TIC staff Immediately

Arranging appointments 24hours

Preparation and confirmation 3days

of itinerary for Potential investors
YOU MAY ALSO CONTACT:
Executive Director
Tanzania Investment Centre
Shaaban Robert Street,
P.O.Box 938
Dar es Salaam
Tel: +255 22 2116328-32
Fax: +255 22 2118253
Email:
information@tic.co.tz
Website: www.tic.co.tz

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www.tic.co.tz

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