Tanzania’s New Business Ban: A Win for Locals or a Risk for Growth?

KDRTV

Tanzania recently issued Government Notice No. 487A, introducing the Business Licensing (Prohibition of Business Activities for Non-Citizens) Order, 2025. The country has barred foreign nationals from operating in 15 key sectors—including small-scale retail and wholesale trade, mobile money services, phone repair, tour guiding, salons (outside tourism), cleaning services, mini-mining, courier services, real estate brokerage, media, museums, crop buying, and more. Existing foreign-owned businesses in these fields may continue until their licences expire, but renewal will no longer be permitted. Violators face fines up to TZS 10 million (~USD 3,900), six months in prison, and visa revocation. Tanzanian citizens who facilitate such operations also face penalties.

Why This Might Be a Turning Point

Development economist Maurice Karimi sees the policy as a bold push for economic indigenisation, aimed at improving job access, boosting local entrepreneurship, and keeping profits within Tanzania. By reclaiming traditionally accessible sectors, the government may help small businesses flourish and reduce economic dependency on foreign traders.

What’s at Stake

Positives:

Protects local traders, especially in places like Dar es Salaam’s Kariakoo market where foreign competition has long been a concern. Offers a boost to grassroots economic participation.

Risks:

The move could deter foreign investors and hurt regional trade. Analysts warn it acts as a non-tariff barrier in the East African Community, potentially triggering retaliatory policies. Thousands of Kenyans living and working in Tanzania’s informal economy may be hit hard.

Legal Ambiguity:

While solo foreign entrepreneurs are clearly targeted, large foreign-owned companies may find loopholes—though regulators are likely to interpret the rule broadly. Legal guidance will be essential.

Tanzania’s move is a high-stakes strategy: prioritising economic nationalism over regional integration signals a shift in policy direction. While it may empower local entrepreneurs, long-term success will hinge on whether this approach can balance protection with growth—and maintain investor confidence.

What do you think? Is this a necessary reset, or a gamble that could hurt Tanzania’s future?