Tanzania economy hits US$91.81bn as growth climbs to 5.9pc

DODOMA: TANZANIA’S economy surged to US$91.81bn in 2025, reflecting stronger macroeconomic performance as real gross domestic product growth increased to 5.9 percent, up from 5.6 percent in 2024, according to revised national accounts data presented to Parliament alongside the government’s 2026/27 development framework. Tabling the State of the Economy for 2025 and the National Development Plan for 2026/27, Minister of State in the President’s Office (Planning and Investment), Prof. Kitila Alexander Mkumbo, said the updated figures are based on a comprehensive rebasing exercise by the National Bureau of Statistics, which shifted the gross domestic product base year from 2015 to 2019. He said the revision has significantly reshaped the measurement of economic output and sectoral composition. “According to the new statistics for the base year 2019, real GDP grew by an average of 5.9 percent in 2025 compared to an average of 5.6 percent in 2024,” Prof. Mkumbo told Parliament. He is of the view that the rebasing has also lifted the measured size of the economy from US$81.2bn in 2024 to US$91.81bn in 2025, while GDP per capita rose from US$1,264 to US$1,390, reflecting gradual gains in average incomes alongside overall economic performance. According to the minister, agriculture remained the leading sector, accounting for 24.3 percent of gross domestic product, followed by construction at 11.9 percent, mining and quarrying at 10.3 percent, trade and maintenance services at 8.6 percent, and transport and storage at 8.3 percent. Moreover, Prof. Mkumbo said sector performance showed strong momentum across key industries. Financial and insurance services recorded the fastest growth at 15.7 percent, followed by electricity and gas at 11.8 percent, mining and quarrying at 9.4 percent, information and communication at 8.8 percent, and transport and storage at 8.0 percent, reflecting broad based expansion across productive sectors. ALSO READ: Tanzania economy soars by 5.9 percent as its GDP rises from 212.tri/-to 234.1 tri/- On the other hand, external investment inflows strengthened during the period. According to the UNCTAD World Investment Report 2025, foreign direct investment rose to US$1.72bn in 2024, from US$1.34bn in 2023, reflecting improved investor confidence in the domestic economic environment. The minister responsible for investment and planning told Parliament that mining and quarrying attracted the largest share of inflows at US$442.2mn, followed by finance and insurance at US$401.3mn, manufacturing at US$223.1mn, and information and communication at US$152.1mn, underscoring the growing role of resource based and service oriented sectors in attracting capital. “The statistics show that Tanzania is among the fastest growing countries in Africa,” Prof. Mkumbo said. Nevertheless, domestic investment activity also strengthened. The Tanzania Investment and Special Economic Zones Authority registered 915 projects in 2025, valued at US$10.95bn, compared with 901 projects worth US$9.3bn in 2024, reflecting a 17.74 percent increase in value. The projects span manufacturing, agriculture, tourism, transport and construction, signalling continued diversification of investment activity. On the other hand, job creation remains a central policy priority, with the government targeting 1.7 million new jobs in 2026, compared with 981,000 jobs in 2024, as policymakers aim to translate macroeconomic gains into broader employment opportunities and inclusive growth. Inflation remained contained within policy limits, averaging 3.3 percent in 2025, compared with 3.1 percent in 2024, mainly driven by food prices. The government maintained that price stability remained within the medium term target range of 3.0 to 5.0 percent, supporting predictable macroeconomic conditions. According to Prof. Mkumbo, poverty indicators continued a gradual downward trend. The 2025 Household Income and Expenditure Survey shows that basic needs poverty in Mainland Tanzania declined to 25.1 percent, from 26.4 percent in 2018 and 34.4 percent in 2007, reflecting long term but moderate improvements in living standards. However, the minister cautioned that the pace of poverty reduction remains slower than overall economic growth, underscoring the need to ensure broader inclusivity in development outcomes. Looking ahead, the government projects gross domestic product growth of 6.3 percent in 2026, supported by continued investment and stronger revenue mobilisation. Fiscal priorities include raising domestic revenue to 17.1 percent of gross domestic product, increasing tax revenue to 13.7 percent, and maintaining the budget deficit below 3 percent of gross domestic product, alongside sufficient foreign exchange reserves to cover at least four months of imports. The post Tanzania economy hits US$91.81bn as growth climbs to 5.9pc first appeared on Daily News