The recent US$320 million loan from Citi and DFC to CRDB Bank is a critical milestone for youth-led businesses in Tanzania and Burundi. This financing, aimed at empowering over 4,500 young entrepreneurs, is a commendable step toward addressing the youth unemployment crisis, with 13.7 per cent of Tanzanian youth jobless.
However, to truly address the root of this issue and promote long-term peace, we must expand our vision beyond financial support to holistic, ambitious strategies.
Youth unemployment is more than an economic statistic—it poses a direct threat to the peace and stability of our society. Idle youth become vulnerable to exploitation by political opportunists, extremism, and social unrest, as we have seen in many other countries.
For Tanzania, with its rich demographic dividend, failure to address youth unemployment can trigger instability and erode the country’s progress. If these young people are given tools, mentorship, and opportunities, they can become powerful agents of peace and economic growth.
Tanzania has taken significant policy strides, such as revitalising the National Youth Council under the 2024-amended National Youth Development Policy, which has laid a foundation for youth engagement in the decision-making process. However, policies alone are insufficient.
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We need ambitious, large-scale initiatives holistically integrate youth into the economy through entrepreneurship, vocational training, and mentorship.
Building blocks
The path forward must start with creating a national equivalent to the Small Business Administration (SBA) of the U.S.—a dedicated agency supporting youth entrepreneurship with financial assistance, low-interest loans, and business guidance.
An SBA-like structure would be instrumental in fostering innovation, providing young entrepreneurs with the technical and operational knowledge to build sustainable businesses. However, we cannot stop there.
Mentorship Hubs should be established in both urban and rural areas, providing spaces for young entrepreneurs to connect with experienced business leaders. These hubs would offer guidance, networking, and strategic advice, helping to ensure that the next generation of business owners is well-equipped to navigate the complexities of running a successful enterprise. Mentorship is key to reducing the high failure rates often seen in young businesses.
Business Labs and Innovation Centres should also be developed, serving as spaces where young people can explore new business models and technologies in sectors like agriculture, technology, and tourism.
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In Tanzania, 65 per cent of the population works in agriculture, yet it remains unattractive to many young people due to outdated methods. By modernising agriculture through technology and innovation hubs, we can turn it into a viable and exciting option for young entrepreneurs.
At the heart of these initiatives must be vocational training programmes aligned with market demands. While academic degrees have value, many jobs require specific technical skills that young people often lack. Vocational training can fill this gap, ensuring that youth are employable and well-prepared for both formal and informal sectors.
Tanzania must invest in aligning education with industry, ensuring that training programs reflect the skills needed in today’s evolving markets.
Youth Employment Zones could be another tool to encourage businesses to hire young people. In these zones, businesses would receive tax breaks, reduced fees, or streamlined processes for hiring youth workers. These incentives could spark economic activity in regions that suffer from high unemployment, further driving Tanzania’s regional development.
The peace dividend
Peace and stability are inextricably linked to economic empowerment. An employed and engaged youth population is far less likely to turn to violence or be swayed by political forces that exploit frustration.
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History has shown that idle and disenfranchised youth are fertile ground for unrest. By addressing unemployment through entrepreneurial support and structured mentorship, Tanzania can build not only a more prosperous future but also a more peaceful one.
The newly revitalised National Youth Council could play a key role in ensuring that youth voices are integrated into policy-making and their unique challenges are addressed.
By giving young people a seat at the table, the government can ensure that the policies implemented are relevant, effective, and youth-driven. This is crucial for long-term success, as young people need to feel a sense of ownership over the policies that shape their futures.
Another vital step is fostering social enterprises that combine profit-making with social impact. These enterprises would tackle community problems, such as waste management or clean energy, and provide young people with employment and leadership opportunities.
Encouraging this model could create a new generation of entrepreneurs committed to both profit and social good, leading to more resilient and self-sustaining communities.
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Lastly, establishing Youth Advisory Councils at both regional and national levels could ensure that youth play a direct role in shaping employment and economic policies. This would create a culture of civic responsibility and give young people a clear path toward becoming future leaders.
The time to act is now
The US$320 million loan to CRDB Bank is a vital step in the right direction, but it should be viewed as part of a much larger and more ambitious plan.
Tanzania’s youth are not just the future workforce; they are the future leaders, innovators, and peacekeepers. When we invest in their potential through large-scale initiatives—mentorship hubs, business labs, youth employment zones, and social enterprises—we are investing in the peace and stability of Tanzania.
The connection between youth employment and peace is clear. As we work to build an economy that supports and empowers young people, we are also building a nation more resistant to unrest. Let us be bold and ambitious.
The future of Tanzania depends on how we engage, uplift, and empower our youth today.
Peace, Salaam.
Paul Mdumi is the Programme Manager for Dialogue and Peacebuilding at Danmission, Denmark’s oldest and largest missionary organisation. He is available at paul.mdumi@gmail.com or on X as @Rev_MdumiJR. These are the writer’s own opinions and do not necessarily reflect the viewpoints of The Chanzo. Do you want to publish in this space? Contact our editors at editor@thechanzo.com for further inquiries.
