Industrialisation and manufacturing, albeit on a minimal scale, are still crucial drivers of Tanzania’s economic growth and structural transformation. Tanzania has experienced various phases of industrial development since its independence in 1961, ranging from state-led import substitution to private sector-led liberalisation and privatisation.
However, the late President John Magufuli’s administration brought industrial development back to be one of the policy priorities to achieve a semi-industrialised and middle-income economy by 2025, a goal now too far to attain.
Tanzania’s manufacturing sector’s performance has improved in recent years, especially in output growth, export growth, production innovation, and product diversity.
The most dynamic sub-sectors are food products, plastic and rubber, chemicals, basic metalwork, and non-metallic mineral products. These sub-sectors have benefited from the increasing domestic and regional demand, the availability of raw materials, the adoption of new technologies, and the supportive policy environment.
The manufacturing sector contributes about eight per cent of Tanzania’s gross domestic product and employs about five per cent of the labour force. However, the sector still faces many challenges, such as inadequate infrastructure, high energy costs, low productivity, and limited access to finance.
This could explain why Tanzania, despite ranking among Africa’s top largest economies, does not feature among the top 10 most industrialised countries.
Leading the list are South Africa, Morocco, Egypt, Tunisia, and Mauritius, with Eswatini, Senegal, Nigeria, Kenya, and Namibia following closely, calling for a reflection of how Tanzania wishes to pursue its human development goals and economic prosperity.
The situation calls for consistent and intentional policy implementation, broader dialogue, and further improvement of the investment climate to enhance the industrialisation process in Tanzania cannot be overlooked.
It also forces Tanzania to look at other experiments outside its borders and learn what works and what doesn’t.
In China, for instance, there were about 80.4 million people employed in urban manufacturing in 2020 and about 23.3 million people employed in rural manufacturing in the same year, bringing the total number of people employed in industrial and manufacturing sectors in China in 2020 to about 103.7 million, which was about 12.6 per cent of the total labour force.
This is nearly twice the entire population of Tanzania, implying that the idea of using industrialisation and manufacturing as key economic drivers and job creation machines is not far-fetched.
As Tanzania is embarking on crafting its 25-year National Development Strategy dubbed “Vision 2050”, strategic interventions must take Tanzania’s manufacturing industry to the next level. The reasons why this is important are crystal clear.
Without a commitment to industrialisation and manufacturing, a nation remains economically tethered to developed countries. The reliance on imports from manufacturing giants compromises economic sovereignty and exposes less developed economies to the vulnerabilities of global markets.
The cases of economic sanctions against nations like Iran, North Korea, Zimbabwe, Venezuela, and Russia have had a profound impact on their economies and their resilience despite the challenges that can be attributed to local manufacturing.
Economic shocks and price fluctuations can significantly impact stability and growth, creating a precarious environment for nations striving to break free from dependency.
In Tanzania, as in many other less industrialised nations, high costs for imported products hinder the purchasing power of the populace.
A stark example lies in the price disparity of goods, where a wealthy European family might acquire a brand new Mercedes Benz GLE 350 4MATIC SUV at a fraction of the cost a buyer in Dar es Salaam incurs.
Investment in the manufacturing sector would also mean more jobs to the growing class of jobless Tanzanians and boost innovation in the country.
Developing industrial and manufacturing sectors fosters a skilled workforce and creates new, sustainable employment opportunities, paving the way for a diversified and resilient job market.
Neglecting manufacturing and industrialisation perpetuates a cycle where nations remain consumers rather than innovators.
Technological advancements are intricately linked with industrialisation and manufacturing, and countries that overlook these sectors risk falling behind in the global technological race.
This has far-reaching consequences, hindering progress in the healthcare and infrastructure sectors.
To pave the way for sustainable and inclusive development, our countries, especially those in the Global South, including Tanzania, must recognise the vital role of industrialisation and manufacturing in shaping their economic destiny.
Forging a future of prosperity for the citizens and our country requires a commitment to building a foundation that includes these essential elements by creating a sustainable industrial economy, ensuring a prosperous and resilient future for nations like Tanzania.
As we are crafting our National Development Strategy for the next 25 years, the government, the task force and the citizens must provide insights that contribute meaningfully to the national dialogue on development and what it means.
At this point, with Vision 2050 shaping our future, it’s timely to examine the state of industrialisation and manufacturing and their implications for our socio-economic landscape.
Kennedy Mmari is the Founder and Chief Executive Officer of Serengeti Bytes, a Dar es Salaam-based communications, public relations and digital media agency. He’s available at email@example.com and on X as @KennedyMmari. The opinions expressed here are the writer’s own and do not necessarily reflect those of The Chanzo. If you are interested in publishing in this space, please contact our editors at firstname.lastname@example.org.