Tanzania, the Bigger Picture of Entrepreneurship

Beginning in the early chapters of the 1900s, the Tanzanian government embarked on several economic empowerment strategies in an attempt to reviving the Tanzanian economy. Some of which were aimed at increasing the involvement of the private sector, liberalization of trade, free interest rate and most importantly reduce poverty through the Poverty Reduction and Growth Facility (PRGF) which was succeeded by the Enhanced Structural Adjustment Facility (ESAF).

In recent years, the Tanzanian economy has experienced a remarking record where its economy was placed as the 98th freest economy in the 2013 index, thereby achieving substantial decline in corruption, excessive government spending, and trade freedom. Following this, it has been able to achieve real economic growth rate above 6% over the years but this has failed to improve the lives of average Tanzanians.

Appraisingly the economy is highly dependent on Agriculture which accounts for more than 25% of her GDP and also a vibrant Industrial sector of 22% of her GDP which placed her in the fastest growing economy in Africa (2010 ranking). Amidst this, the government still has a critical role to play in the achievement of improved living standard of the Tanzanian citizenry.

It can be said that much has to be done by the government but even much more by the citizens who make the government and play a very paramount role in their economic enhancement. Surprisingly the economy boasts of a 35% rate of SMEs acquiring a labour force of 20% creating the potential for job creation and advancement of the economy.

“The best way to predict the future is to create it” – Peter Drucker. The future of Tanzania is in seizing new opportunities, managing, organizing, combining and creating ideas with the capacity of addressing national and global issues, not forgetting the one most important idea which is creating from what you already have. The conditions of the African continent and particularly Tanzania are ripe for entrepreneurship.

To state the impact of entrepreneurship in any nation’s economy, we cite the sudden boost of the People’s Republic of China, India, Singapore and Brazil amongst, as well as the enormous social and economic growth of already developed nations, to state a few, USA, Sweden, Germany, Britain, Italy and France. Furthermore the growth and development being witnessed in these Nations can be highly attributed to their intelligent adoption of entrepreneurship, proving that small businesses are the fundamental principle for reduction in poverty, unemployment, increase in the Gross Domestic Product, Increase in per capital income, rural to urban migration, technological advancements, increased national productivity and competitive advantage.

Going by the quote “American still leads the World” may sound quite pragmatic and realistic to everyone as in spite of the recent down drop in economic progression as a result of the economic crisis, she remains the beacon of entrepreneurship, this as a result that it is deeply rooted in its history. From the years 1996 to 2004, it created an impressive average of 550,000 small scale businesses monthly. Some of which have grown into big corporations like the Wal-Mart, Facebook and Google. The tale behind successful entrepreneurship in American and other successful countries seems the same with little or no differences which with considerable application can work in Tanzania. To mention the advantages leading to the successful entrepreneurial transition of the American economy, it must be noted that it also has its disadvantages which places the Tanzanian economy in the same deck, having its advantages and disadvantages.

The Organization for Economic Cooperation & Development (OECD) qualifies entrepreneurship as a motivating force for initiating business ideas, mobilizing human, financial and physical resources for establishing and expanding enterprises and creating jobs. To mention the high level of poverty standing at 38.7%, unemployment rate of the Tanzanian population at a 10.70% rate and the tendency of a continuous increase which over the years the median age has continued to drop causing an increase in the number of youths which already form over 40% of the Tanzanian population and in the next decade an expectant youth boom, making them the crucial mass for economic development, the feasible option of creating jobs and most importantly reducing poverty.

Virtually all entrepreneurs around the world face experiencing growing pains and in some level there will continue to be a growing array of socio-economic, environmental, and governance challenges on the decision makers. This equally does not exempt Tanzania as doing business in Tanzania can be notoriously challenging where a record of just 4% of youths is recorded to have gained access to micro credits considering the challenges of bureaucratic difficulties, poor infrastructure, corruption, lack of capital, lack of entrepreneurial training, electricity, culture and beliefs and a lag in administrative activities.

This has, however, become even less challenging in recent times following the introduction of several initiatives, reforms, programmes and policies by the government like the Millennium Development Goals and BPoA; Rural Development Policy (RDP), Poverty Reduction Strategy Paper (PRSP), Agricultural Sector Development Strategy (ASDS), National Strategy for Growth and Reduction of Poverty (NSGRP), Strategic Trade Policy (STP), BEST Programme (BP), Micro-finance Policy and Poverty Alleviation Strategies (MPPAS) amongst the intervention of other NGOs positively aimed at encouraging youths involvement in national development which has created hope for the promise of entrepreneurial spirit owing to the fact that the world we are today has changed.

Realizing the need and urgency for youth empowerment and the recognition as the backbone of the Tanzanian economy through entrepreneurship and SMEs, it is imperative to state that the need to further tackle some of the bottleneck challenges meeting the achievement of national growth and development must be instantaneously and effectively administered. The point where government intervenes and cuts off the red tape obstructing youth entrepreneurship and the creation of a conducive business environment, at this point will the future of unemployment be determined.

To accelerate capacity building, skills development and entrepreneurial spirit amongst youths, the Tanzanian government needs to provide a unique platform where its policies, programmes and initiatives can on a level field engage youths from varying background, where these youths can learn to develop both technical and business skills for entrepreneurship and improved employability. Also when it comes to development it is not just about the government, but rather it is also considered as a function of the citizens especially youths where responsibilities can be shared and achieved.

Tanzanian youths are very adventurous, hard-working and finding every possible way to make positive impact on their economy. With the challenges, risk and undertakings involved in entrepreneurship it is impossible to claim that there are no entrepreneurs as true entrepreneurs are neither looking for handouts or for subsidy, rather they are looking for opportunities to put their ideas to work. They are looking for an enabling environment to thrive and bloom.

The Tanzanian government needs to play a major role in the provision and sustainability of good infrastructure especially power and maintain policies that will protect the interests, ideas and investments of entrepreneurs.

Credit which is one of the paramount necessities still poses difficulties in it accessibility. As access to credit especially in the rural areas continues to remain a major problem, also the government needs to play a role in the reduction and supervision of interest rates and requirements of collateral demanded by financial institutions.

Furthermore on the credit facilities, is another role of the government in its responsibility of providing soft loans to youths which have little or no interest rates, forgo the requirement of collateral but on a basis of a qualification criteria in having a business plans, proving equity and fairness in participation, ability to refund loan.

Also Government agencies and NGOs involved in capacity building and skills Training needs to be supported by the government as it is through training can youths of Tanzania gain knowledge in risk taking, business skills, management skill and furthermore.

Bureaucratic and administrative difficulties have created chokepoints and continue to be a problem in Tanzania and several other African countries as the protocols passed in the registration of business ventures by individuals continues to remain a major problem. To mention to required cost involved in having a business venture also remains a problem. The government of Tanzanian needs to address this as opening a business venture in Tanzania can take over 6months hindering the possibility of entrepreneurship by youths, where in most developed nations creation of business ventures can take just a day.

The immense need and importance of young entrepreneurs in Tanzania has never become more important than now. Coming at the right time, it remains the solution to the problems faced by the economy and unless the government realizes that with the youths being self-employed would contribute economically, socially and politically and with the feeling of ownership of businesses would promote self-esteem, financial freedom and the patriotic feeling regarding for development and growth. Highlighting the need for the government to effectively monitor its reforms, programmes and initiatives to the sustainability and achievement of national development.


Okafor Kingsley Chukwuma was born in Lagos, Nigeria. His father and mother are Igbos. He started writing since age 14 and in 2003 was awarded Distinguish Minus Poet (D.M.P) for his works on poetry by president Wale Ajakaiye, founder of Minus Poetry, Nigeria. He graduated from high school in Lagos 2003, after attending the university, received a BSc in Economics from Nasarawa State University in 2008 then went on to do his National Youth Service Corps at Government Secondary School, Bwari, Abuja in 2009 – 2010. After his Youth service, he worked with a non-governmental organization where he worked as a programmes and technical officer on a 7months contract heading the Save Somalia Campaign Team. After which he moved on to work with a South African Tourism firm where he worked as a Sales consultant for 8months, been able to attain several professional qualifications he then decided it was paramount to obtain a higher degree and he is studying currently to attain an MBA in Financial Management in Girne American University, Cyprus. Okafor Kingsley Chukwuma is currently studying and building himself in every capacity so as to gain a career in the United Nations.

View all posts by justwritins →