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OECD Investment Policy Reviews: Tanzania 2013

image of OECD Investment Policy Reviews: Tanzania 2013

This review of investment policy in Tanzania evaluates the current policy situation and makes recommendations for  enabling Tanzania to attract higher investment to exploit its full potential and become a regional trade and investment hub. The review finds that while private investment in Tanzania has considerably risen since the early 1990s, further progress can be made to improve the business climate and attract more investment in key sectors, such as infrastructure and agriculture.

Informed by the subsequent chapters of this report, this overview provides policy options to address these challenges. In particular, investors’ rights and obligations could be rationalised and made more accessible and regulations on foreign investment and investment incentives reviewed. The land legislation could be revised and land rights registration accelerated, notably by providing stronger incentives for registration. The short-term and long-term costs and benefits of the regulatory restrictions imposed by crop boards and of export bans could be closely analysed.

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Overview of progress and policy challenges in Tanzania

Major economic reforms which have liberalised trade, enhanced the role of the private sector and led to the creation of Tanzania Investment Centre, have generated a steady GDP growth in Tanzania since 2000. Nevertheless, the regulatory framework for investment could be further improved, and investment incentives are not systematically evaluated. The investment regime could be further rationalised through strengthening of the Tanzania Investment Centre as a one stop shop to have full mandate for approval of investment permits. Tanzania still lacks adequate enabling infrastructure and the private sector does not actively participate in infrastructure development. Access to land can be a lengthy process for foreign and domestic investors alike, and land tenure remains insecure for smallholders. In addition, restrictions on agricultural trade hinder investment in agriculture. Informed by the subsequent chapters of this report, this overview provides policy options to address these challenges, in view of enabling Tanzania to attract higher investment and to potentially become a regional trade and investment hub.

English

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