Tanzania is not a poor destination for investment. It is a country rich in minerals, natural gas, agricultural land, wildlife, ports and a young labour force.
It provides access to the Indian Ocean and serves as a commercial gateway to several landlocked countries, including Rwanda, Burundi, Zambia, Malawi, Uganda and the Democratic Republic of Congo.
The country is also investing heavily in roads, railways, ports, airports and electricity generation. These are important foundations for economic growth.
According to the Tanzania Investment Report 2025, foreign direct investment inflows reached approximately US$1.656 billion in 2024. The money went mainly into mining, financial services, manufacturing, information and communication activities. This represented a small increase of 0.4 per cent despite a decline in global investment flows. That is encouraging – but Tanzania could attract much more.
The central problem is no longer simply whether Tanzania has investment opportunities. It is whether investors can trust the institutions responsible for regulating those opportunities.
An investor may obtain encouragement from the President, a certificate from the Tanzania Investment and Special Economic Zones Authority, approval from a ministry and assurances from regional officials. But the same investor may later encounter unexpected tax demands, conflicting licences, land disputes, delayed VAT refunds or instructions from another government agency contradicting earlier approvals.
When that happens, who is held responsible? Too often, the answer is nobody.
The Acacia case should have taught us something
The dispute between the Tanzanian government and Acacia Mining remains one of the clearest examples of why investment decisions require both firmness and accountability.
In 2017, Tanzanian authorities accused Acacia of serious tax and mineral-export irregularities. The Tanzania Revenue Authority reportedly presented the company with tax claims running into approximately US$190 billion.
The government had every right – and indeed a duty – to ensure that Tanzania received a fair share of its mineral wealth. Foreign companies must not be allowed to exploit natural resources, avoid taxes or manipulate export declarations.
However, the dispute was eventually settled after Barrick Gold intervened. The agreed settlement included a US$300 million payment and a new arrangement under which economic benefits would be shared between the government and Barrick.
This left a major unanswered question. How did a claim of approximately US$190 billion end in a settlement of US$300 million?
Perhaps the original claim was justified but difficult to enforce. Perhaps it was calculated using assumptions that could not survive legal examination. Perhaps the final settlement reflected commercial realities. The public was never given a sufficiently detailed explanation.
Accountability would not mean defending Acacia. It would mean asking the officials who calculated, approved and announced the original figure to publish their methodology. It would also mean requiring those who negotiated the settlement to explain what Tanzania gained, what it surrendered and why.
A government cannot demand transparency from investors while hiding its own calculations from citizens.
Tax administration must not depend on the mood of an officer
Investors frequently complain not only about tax rates, but also about inconsistent interpretation of tax laws, unpredictable assessments and long delays in receiving VAT refunds.
The United States government’s 2026 investment-climate assessment identifies arbitrary, non-transparent and inconsistent application of tax policies and regulations among Tanzania’s major investment challenges. It also identifies corruption as a growing concern.
This does not mean that every complaint from an investor is genuine. Some businesses deliberately understate income, inflate expenses or avoid taxes. The Tanzania Revenue Authority must pursue them firmly.
But tax enforcement should be based on law and evidence – not intimidation, revenue targets or administrative discretion.
A responsible system would publish the number and value of disputed tax assessments, the percentage overturned on appeal, the time taken to resolve cases and the names of departments – not necessarily individual taxpayers—responsible for repeated unlawful assessments.
If a regional tax office issues ten major assessments and courts overturn eight of them, that should affect the evaluation of its managers. An officer should not be praised for issuing an enormous assessment that cannot be legally defended.
The proposed 2026/27 budget reform requiring VAT refunds to be paid within 30 days, with interest accruing on delayed payments, is therefore a positive step. But the law will only matter if the responsible officials face consequences when the deadline is ignored.
Delayed projects must have names attached to them
Tanzania has placed considerable hope in public-private partnerships. Through PPPs, private capital can help build roads, hospitals, transport systems, markets and other public infrastructure.
Yet projects can remain trapped for years between feasibility studies, ministries, procurement authorities, legal reviews and financing negotiations.
The problem is serious enough that, in October 2025, the Public-Private Partnership Centre entered an agreement with WAJIBU Institute of Public Accountability to investigate the causes of delays in implementing PPP projects.
That is an important admission: delays are not imaginary. But studies alone will not solve the problem.
Each major investment project should have a publicly named accounting officer. There should be a clear timetable showing when land will be provided, licences issued, environmental studies approved, financing completed and construction started.
When a deadline is missed, the public should be told whether the delay was caused by the investor, the ministry, the local authority, the Attorney General’s office, the Treasury or another institution.
At present, “the government” is often blamed as though it were one invisible person. Accountability requires identifying the office where a file stopped and the officer who had the power to move it.
Investment must not violate citizens’ rights
Accountability also protects Tanzanians from irresponsible investors and badly designed government projects.
In 2024, the World Bank suspended further disbursements under a US$150 million tourism project connected to Ruaha National Park. The suspension followed allegations of killings, disappearances, torture, forced evictions and confiscation of livestock involving park rangers.
The Tanzanian government disputed aspects of the allegations and said misconduct would be investigated, but the World Bank withheld the final US$25 million tranche.
This case demonstrates that investment is not automatically development.
A tourism project may increase revenue, but if communities are beaten, displaced without fair compensation or denied justice, the project becomes a source of conflict. Eventually, financiers withdraw, Tanzania’s reputation suffers and ordinary citizens carry the cost.
Responsible investment must therefore include enforceable protections for landowners, workers, surrounding communities and the environment. Officials who approve projects must remain answerable for their social consequences. Investors who violate Tanzanian laws must also face sanctions, regardless of their economic importance.
Credit remains too limited
Tanzanian businesses also face difficulty obtaining affordable finance.
An International Monetary Fund study reported that domestic credit to Tanzania’s private sector stood at only 16.4 per cent of GDP in 2023. This was substantially below Kenya’s 31.6 per cent, Rwanda’s 22.7 per cent and the sub-Saharan African average of 33.4 per cent.
This matters because investment is not only about multinational corporations.
A Tanzanian farmer who wants to build a processing plant, a young technology entrepreneur, a transport operator seeking new vehicles and a manufacturer trying to buy modern machinery are all investors.
When banks prefer government securities or demand collateral that emerging businesses cannot provide, domestic enterprise remains small. Foreign companies then enter sectors that Tanzanians might have developed themselves.
The Bank of Tanzania, Ministry of Finance and commercial banks should publish clearer information about lending to productive sectors, interest-rate spreads, rejected applications and the proportion of credit reaching women, young entrepreneurs and small businesses.
Accountability should be measurable
Tanzania does not need another investment slogan. It needs an accountability system.
Every major regulatory institution should publish a quarterly performance dashboard showing:
– the average number of days required to issue a permit;
– the number of applications pending beyond the legal deadline;
– the value of outstanding VAT refunds;
– the number of tax decisions overturned on appeal;
– unresolved land-compensation cases;
– delayed PPP projects and the offices responsible;
– investor complaints received and resolved;
– jobs actually created against jobs promised; and
– environmental or community violations recorded against investors.
Parliament should summon accounting officers when targets are repeatedly missed. The Controller and Auditor General should conduct performance audits, not merely financial audits. Ministers should explain failures publicly. Senior officials who repeatedly cause unlawful delays or losses should be disciplined, transferred or removed.
Investors must be subjected to the same standard. Companies receiving tax exemptions, public land, government guarantees or exclusive concessions should disclose their beneficial owners, investment commitments, employment targets and taxes paid.
Confidentiality must not become a hiding place for incompetence, corruption or unfair deals.
Tanzania must choose predictability over personal discretion
Investors do not demand a country without regulations. Serious investors prefer clear regulations because rules protect them from dishonest competitors.
What frightens investors is uncertainty: a tax rule interpreted differently from one office to another, a licence that can be cancelled without due process, a contract altered after political intervention or a project delayed because an official refuses to sign a document.
Tanzania’s economy has continued to grow, but growth alone is not enough. The World Bank estimates that about 48 per cent of Tanzanians were living below the international poverty line of US$3 a day in 2025. It argues that stronger human-capital investment and business-environment reforms are needed to generate more private-sector employment.
This is why accountability is not an abstract governance issue. It is about jobs, incomes and poverty.
Every delayed factory represents employment postponed. Every unlawful tax demand threatens wages. Every unresolved land dispute discourages production. Every secretive agreement creates suspicion. Every official who makes a costly decision without consequences teaches others that public authority can be exercised irresponsibly.
Tanzania has the resources, location and population required to become a major African investment centre.
What it still needs is a system in which decisions leave a trace, deadlines have consequences, contracts can be scrutinised and every person exercising public power can answer a simple question:
What did you decide, under which law, at what cost – and who will take responsibility if you were wrong?
Until Tanzania answers that question, its greatest investment risk will not be a lack of capital. It will be the absence of accountability.
