Tanzania is one of the fastest-growing economies in Africa, with a population of approximately 58 million people. The country is rich in natural resources and has a diversified economy. The manufacturing sector is an essential component of Tanzania’s economy, contributing to the creation of jobs, economic growth, and poverty reduction. In this article, we will provide an overview of Tanzania’s manufacturing sector, including its current status, challenges, and potential for growth.
Current Status of Tanzania’s Manufacturing Sector
Tanzania’s manufacturing sector has seen significant growth in recent years, contributing to the country’s economic development. The following table shows the contributions of Tanzania’s manufacturing sector to GDP from 2016 to 2019:
| Year | Value |
|---|---|
| 2016 | 12,264,650.4 |
| 2017 | 14,493,825.8 |
| 2018 | 16,944,950.1 |
| 2019 | 19,872,301.8 |
As we can see from the table, the manufacturing sector’s contributions to Tanzania’s GDP have increased steadily over the years, with a growth rate of 18.2% between 2016 and 2019. The sector’s growth is mainly driven by food and beverage processing, textiles, and leather goods manufacturing.
Challenges Facing Tanzania’s Manufacturing Sector
Despite the growth, Tanzania manufacturing sector faces several challenges that hinder its potential for further development. The challenges include:
- Inadequate infrastructure: Tanzania’s infrastructure, including transport and energy, is insufficient, which increases the cost of doing business.
- Low productivity: The productivity of the manufacturing sector is low, partly due to the lack of skilled labor, which limits the industry’s competitiveness.
- Limited access to finance: The manufacturing sector faces difficulties in accessing finance, which hinders investment and expansion.
- High production costs: The high cost of raw materials, energy, and labor increases the cost of production, making Tanzanian manufactured goods less competitive.
Potential for Growth
Despite the challenges facing Tanzania manufacturing sector, there is immense potential for growth. The government is taking steps to address the challenges by investing in infrastructure, including the construction of the standard gauge railway and the Julius Nyerere International Airport. The government is also working to improve the business environment and enhance access to finance for the manufacturing sector.
Furthermore, Tanzania’s geographical location makes it an attractive destination for investment, particularly for firms looking to establish regional supply chains. The country also has a large domestic market, which provides opportunities for firms to produce goods for local consumption.
Conclusion
Tanzania’s manufacturing sector is an essential component of the country’s economy, contributing significantly to job creation, economic growth, and poverty reduction. Despite the challenges facing the sector, the government is taking steps to address them, and there is immense potential for growth. As Tanzania continues to develop, the manufacturing sector will play a critical role in driving economic growth and improving the livelihoods of Tanzanians.
 Kessy Juma is the founder of Miamia Trading Company (miamiatz). He is a Techpreneur with roots in accountancy. He believes that any business is good as long it caters the right market using the right strategy. 
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