Tanzanian manufacturing sector is among the leading division stimulating growth in the post pandemic recovery. The field is currently contributing nearly one-tenth of the economy, employing millions of Tanzanians.
Manufacturing is also a main source of revenue to the governments, in terms of export sales, as well as for both corporate and income taxes.
A competitive sector
The Tanzanian manufacturing sector consists mainly of food processing (24%), textiles and clothing (10%) and chemicals (8.5%). But it also includes the following fields: beverages, tobacco, brewing, cement, leather, paper and plastics.
The Bank of Tanzania (BOT) confirmed that the sector has maintained the second lead position in contributing to export earnings. The increase in these earnings reflects the ability of the sector to now compete in world markets.
A promising result that demonstrates the government’s willingness to push industrialization and transform the economy.
Data for the mainland
Tanzanian manufacturing sector in the mainland injected $1.27 billion to the economy in exports during the year ending February 2022. The economic data is close to half the amount of gold exports ($2.6 billion).
The rise we observed in exports is connected with cosmetics, cement and plastic industry.
This dynamic has also stimulated the imports of industrial supplies to Tanzania mainland (+34% in a year). According to BOT reports, capital goods imports, mainly machinery, electrical machinery, food and beverage for industrial use were high during the given period.
Reports have also shown that banks’ confidence on Tanzanian manufacturing is also high, as credit growth remained double digit at 12.4% during the fourth quarter of last year.
Data for Zanzibar
Zanzibar also experienced impressive growth over the time period considered. Manufactured goods exports injected $7.6 million, an increase of 50%, compared with 2021 earnings.
The amount was second only to cloves, edging other lead sectors, including seaweeds.
This has also pushed up the isles industrial supplies imports (+61%) and industrial raw materials imports (+60%).
GDP and employment
In conclusion, the sector is still relatively small but has a significant contribution to the country’s overall GDP. Over the past decade the Tanzanian manufacturing sector has averaged 8% of GDP and 4% annual growth rate.
However, the number of the employees has not been reflected by the fast growth of the manufacturing sector, as data shows they account for eight out of hundred employed people.