U.S. firms experience significant challenges conducting business in Tanzania, including predatory tax collection, poor regulatory coordination, and underdeveloped infrastructure. The slow pace and opaque nature of decision-making at various levels create space for corruption. Port inefficiencies at Dar es Salaam also create severe logistics delays, sometimes lasting many months, that impose substantial costs on businesses.
While the Tanzanian government has made significant investments in infrastructure, including the Nyerere Hydropower Plant, the Standard Gauge Railway (SGR) system and roads and airport systems, infrastructure gaps remain a serious obstacle to economic growth. Tanzania’s digital economy is developing but faces challenges including poor infrastructure (limited internet access, high costs, and unreliable power), a digital skills gap, and low digital literacy. Other hurdles include inadequate regulatory frameworks, security concerns including cybercrime and data privacy, and the high cost of technology adoption for both individuals and businesses.
Tanzania is a very price-sensitive and competitive market; life cycle costs are not considered, specifically in government tenders.