Tanzania, like most African economies, relies heavily on agriculture for economic growth and development. For the most part, the country has consumed most of its products in their raw forms but has recently laid down policies to ensure value is added to its agricultural products. For example, the nation is working towards a 2025 vision of developing at least two products from all livestock, crops—coffee, rice, and fisheries—by the end of the year, 2025.
Perhaps the most remarkable role agribusiness plays in Tanzania’s economy is that it is the largest employer of its labour force, engaging over 70% of its population, as reported in 2021 by the International Trade Administration of the USA. Through agribusiness, entrepreneurship is booming as many join the value chains.
Tax revenue from agribusiness is a significant source of revenue for the Tanzanian economy. A 3% tax rate collected by local authorities on all agricultural products remains a substantial source of revenue for the country.
Another important role agribusiness plays in Tanzania’s economy is its contribution to the country’s Gross Domestic Product (GDP). The Food and Agriculture Organisation (FAO) forecasts that 28% of Tanzania’s GDP can be attributed to agriculture and related activities, making agribusiness the backbone of Tanzania’s economy.
Agribusiness in Tanzania has fostered international collaborations and funding between Tanzania and donor organisations such as the World Bank and the FAO. These organisations provide aid to Tanzania in the form of technical training, knowledge sharing, and monetary support. For example, last year, the Tanzania Food Systems Resilience Program (TFSRP) received grants to the tune of $92 million, with support from IFAD and JICA.
The exportation of agribusiness products from Tanzania has improved the country’s balance of payments, as the country gains from exporting agribusiness products to other countries. Notably, about 80% of Tanzania’s total exports are agricultural products, according to the Embassy of the United Republic of Tanzania in Stockholm, Sweden.
Though agribusiness plays a vital role in Tanzania’s economy, challenges persist. Farmers rely heavily on natural weather patterns, and diseases and pests significantly affect crops and animals. Farmers also rely on simple and limited farm tools, and there is a lack of a ready market for farm produce, hindering the country from achieving its full agribusiness potential.
