If you are traveling or moving to Tanzania, you might be interested in setting up a business in the country. According to various business reports, it is a fairly stable and safe time to invest in the country, with low risk and high return potential. This article outlines Tanzania’s overall business landscape, the types of businesses you can set up, and the details of doing so.
Business landscape
Whilst the poverty rate in the country has declined, the actual number of people in poverty has not, due to Tanzania's high population growth. In 2016 the full population was at around 55 million people. The country has seen relatively high economic growth however over the past decade, which has been averaging at 6-7% per year. Inflation has been stable; this can at least in part be attributed to consistently low food prices.
The overall economic outlook is positive, risks for which are mostly under governmental control. With the private sector contributing to the country's further development, this will aid the government's ambitious plans for investment, will be a source of both finance and innovation, and will create jobs for locals who are entering the job market.
The strength and quality of Tanzania's human resources have to be aligned with investments in infrastructure, in order to link rural farmers to markets, and people to services. Ideally, the fruits of this growth would then be shared across the rural communities within the country.
Business entities
Depending on your interest and endeavours, there are a number of corporate structures available to you to legally register and conduct business in Tanzania. The most common and preferred structure by entrepreneurs is a limited liability company (LLC) - locally this is referred to as a 'private limited company.' A public limited company (PLC) is an alternative available but a minimum of â¬70 000 is required for share capital.
Procedures
It is advised that you consult a qualified business advisor when going about setting up a business in Tanzania. They will guide you through this process, familiarize you with local laws and regulations, and provide general information that will be of strategic use to your company.
The list below outlines the procedures that one will need to follow in order to set up a business in Tanzania:
- Apply for clearance of your proposed company name
- Obtain a notarized declaration of compliance
- Apply for company incorporation and obtain the certificate of incorporation
- Apply for taxpayer identification number (TIN)
- Obtain taxpayer identification number (TIN)
- Apply for a business license
- Apply for the VAT certificate
- Register for the workmen's compensation insurance
- Register with the Occupational Safety and Health Authority (OSHA)
- Receive inspection from the Occupational Safety and Health Authority (OSHA)
- Obtain Social Security registration number
Completing all of the tasks does not take too much time, especially because many can be done simultaneously. The longest individual task is the registration with the OHSA which can take up to 10 days.
Useful links:
Doing Business: Explore Tanzania's economy
Business entities in Tanzania
Tanzania Economic Outlook 2017 - Deloitte
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