The Tanzanian government made changes to its investment laws, heralding opportunities for foreigners seeking to invest in the country.
In December last year, Tanzania enacted Investment Act No.10 of 2022, repealing the Tanzania Investment Act No. 26 of 1997.
In the new Act, there is no longer a limit on the number of work and residence permits that can be granted to new investors.
Secondly, the minimum investment threshold for Tanzanian national investors has been reduced from USD 100,000 (Ksh.12.6 million) to USD 50,000 (Ksh.6.3 million) and for foreign nationals, it remains USD 500,000 (Ksh.63.1 million).
There are also several new qualification requirements for strategic investment, including that the investment project must generate 1,000 local senior position job opportunities down from 1,500.
Other enacted Acts include increasing exports by 50 percent of the products produced or reducing imports, stimulating the production of products for economic incentives in social and economic sectors, improving the technical skills of employees by introducing new technologies to Tanzanians and developing essential products and services in social and economic sectors.
The new Act also touches on land and would remain a challenge for foreign investors and their interaction with Tanzania Investment Centre (TIC).
The repealed Act had assumed that TIC would oversee a ‘land bank’ where land designated for investment purposes would be readily available.
Foreign investors in the new Act are required to go through an occasionally lengthy process of identification and conversion of land from one category to another (village to general land for example) in order to obtain derivative rights from TIC.
A foreign investor who is currently eyeing Tanzanian space is American billionaire Elon Musk and has been pushing for regulatory approval for his Starlink operations.
Both Starlink and the Tanzanian government are in an advanced stage. Minister for Information, Communications and Information Technology Nape Nnauye confirmed that a few issues are pending.