Far from the grim overall economic outlook for the continent in 2023, Tanzania is projected to see significant economic growth this fiscal year. The main economic drivers will be oil, gas and mining sectors. Experts predict that African recovery in 2023 will be steered by East Africa notably, Uganda, Tanzania and Kenya. The Economic Intelligence Unit (EIU) forecasts that Uganda will have the growth rate of 6%, with Tanzania and Kenya doing about 5% each.
Tanzania’s positive growth outlook is anchored on the aptness of its oil, gas and mining projects to current global investment sentiments. Tanzania is positioning its economy to assume a dominant role in the manufacture of electric vehicles, renewable energy projects and green metals. Hence, the upsurge in investments coming into the country.
For instance, Africa House Project Platform has a portfolio of projects for Tanzania that is valued at USD 185 billion. The value of projects in the mining sector is about USD 12 billion and USD 55 billion for oil and gas. Even with many of the projects in the early stages of development, the East African nation is making significant progress.
The global energy dilemma amplified by the Russia-Ukraine war has revived interest in Tanzania’s LNG project valued at USD 30 billion. This facility located at Lindi would sit on the country’s coast, serving as a terminal and gas liquidation hub. It was announced in 2016, but negotiations between government and partners were stalled for a long while.
President Samia Suluhu Hassan is eager to see the project take-off. Discussions have resumed, with Norway’s Equinor and Shell showing strong commitment to getting the project up and running. Final Investment Decision (FID) is expected in 2025. Additionally, another LNG plant is being discussed which will involve the construction of two trains on land to export natural gas from the country. Oil super majors linked to the project include: Royal Dutch Shell, Exxon Mobil, Sophi Energy Co. Ltd. and Ting Energy Plc. Ltd.
Tanzania’s proven gas resources are massive. As much as 1.6 billion cubic metres of gas lies in its acreages, with roughly 75% offshore in the Indian Ocean. Boosted by stability and ease of doing business, there is an influx of investments into the country: particularly, due to the acceptance of gas as a transition fuel as the world transitions to NetZero. The government is investing in several projects in the south of the country, including a port and a power station to expand the economy.
There is an upturn in portfolios that support Electric Vehicles (EV) and green energy as well. Australia and Tanzania are working on several graphite, nickel and cobalt projects-very important metals for the production of EV batteries