Dodoma — Tanzania has set an ambitious target of reducing imports by 50 percent, increasing the contribution of small and medium-sized enterprises (SMEs) to manufacturing value from 12 percent to 60 percent, and expanding manufactured exports as part of a new industrial transformation agenda extending to 2035.
The urgency of the ambition is underscored by the country’s merchandise trade figures. According to the Tanzania Economic Survey 2025, imports rose by 4.2 percent to US$14.79 billion in 2025, with capital goods accounting for 45.6 percent, intermediate goods 27.3 percent and consumer goods 27 percent of the total; the country recorded a merchandise trade deficit of US$4.52 billion.
The targets were announced during the launch of the Sustainable Industrial Development Policy 2025 and the revised Small and Medium Enterprises Development Policy of 2003, 2025 edition. Prime Minister Mwigulu Nchemba launched the two policies on behalf of President Samia Suluhu Hassan.
The industrial policy, backed by a ten-year implementation strategy covering 2025/26 to 2034/35, seeks to strengthen domestic manufacturing, increase value addition and position Tanzania as a competitive industrial economy in line with Development Vision 2050.
Speaking at the launch, Nchemba said the policies were intended to give fresh direction to industrial development and strengthen the government’s commitment to creating a favourable environment for businesses. However, he cautioned that their success would depend on effective implementation rather than the adoption of policy documents alone.
“Policy is one thing, and implementation is another,” he said, urging the Ministry of Industry and Trade to establish clear implementation strategies, monitor progress and coordinate industrial value chains with other government institutions and the private sector.
The new policy builds on the achievements and shortcomings of the previous Sustainable Industrial Development Policy, which covered the period from 1996 to 2020. Figures in the new policy document indicate that the value of manufactured goods increased from TSh 254.326 billion in 1996 to TSh 13.182 trillion in 2023, while manufacturing’s contribution to gross domestic product (GDP) rose from 1.1 percent to 7 percent.
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Industrial production growth increased from 4.8 percent in 1996 to 5.8 percent in 2019. Formal manufacturing employment in establishments with more than ten workers reached 374,485 in 2022, compared with 63,317 in 1999. The value of manufactured exports also grew from US$902.7 million in 1996 to US$1.3633 billion in 2023.
Despite these gains, the policy identifies persistent challenges, including inadequate value addition, limited access to industrial financing, outdated production technologies and insufficient investment in research and innovation.
Minister for Industry and Trade Judith Kapinga said the previous policy had laid an important foundation for domestic manufacturing, particularly through investments in strategic industries. She cited Tanzania’s annual cement production capacity of approximately 9.1 million tonnes and tile production capacity of 33.75 million square metres, against domestic demand of 21.6 million square metres.
“These achievements did not come by chance. They are the result of planning, well-written policies, and implementation by both the government and the private sector,” Kapinga said.
The new policy identifies five priority areas: strengthening value addition and industrial value chains; establishing strategic industries; expanding access to domestic and international markets; promoting research and innovation; and addressing cross-cutting issues, including environmental protection and inclusive participation.
Kapinga said the government wanted domestic production to play a greater role in meeting local demand and expanding exports.
“In these new policies, we want domestic production to reduce imports by 50 percent, and manufactured goods to contribute 50 percent of exports. That is why we have rewritten the policy, and we already have a 10-year implementation strategy to ensure we achieve this,” she said.
The strategy identifies machinery and equipment manufacturing, chemicals, microchips, rare-earth mineral processing, garments, defence equipment and vehicle manufacturing among the industries expected to support this transformation.
Delivering these ambitions will require substantial investment. The implementation strategy estimates that TSh 76.96 trillion will be needed over the ten-year period, with financing expected from government budgets, private investors and development partners.
Nchemba said industrial growth would also depend on changing public attitudes towards locally manufactured products. He recalled an investor who complained that consumers were reluctant to buy goods manufactured in Tanzania but readily purchased similar products when they came from the investor’s factory in a neighbouring country.
He urged government institutions to lead by example by prioritising locally manufactured materials, including glass, steel bars, tiles and furniture, when constructing and furnishing public buildings.
“It would make no sense for us to build factories, then make products that even we ourselves do not use, and then export jobs by buying products from factories in other countries,” he said.
The Prime Minister also called for greater recognition of the private sector as a central partner in national development. He said the Vision 2050 implementation framework envisaged businesses contributing 70 percent of development efforts, while the government and its institutions would account for the remaining 30 percent.
With approximately 1.5 million Tanzanians entering the labour market annually, Nchemba argued that expanding private investment was essential to creating employment opportunities that public institutions alone could not provide.
“The answers to our country becoming self-reliant are that we must build a strong private sector, a private sector that can be trusted,” he said.
Kapinga said the new framework would also give attention to startups and youth-led enterprises by promoting modern production technologies, innovation and access to international markets. She acknowledged that implementation was often the weakest link in policy development but pledged to ensure the new commitments translated into action.
“There is a perception that once documents are prepared, the trouble lies in implementation,” she said. “I assure you, and I assure the President, that this will not happen during the time she has entrusted us to oversee this ministry.”
Permanent Secretary in the Ministry of Industry and Trade, Ambassador Waziri Salum Rajabu, said the formulation of the two policies had followed government guidelines and involved relevant stakeholders to promote inclusive participation and ensure alignment with national development priorities.
