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Kalpesh Mehta

TANZANIA - Economy

All Signs Point to Yes

Chairman, British Business Group (BBG)


Kalpesh Mehta is Chairman of BBG and a seasoned finance professional with over 20 years of international experience in the oil and gas, telecoms, and FMCG industry. He holds BA in economics from the University of Manchester and a fellowship from UK ICAEW.

What do changes to the membership mix at the BBG say about recent developments in Tanzania’s business environment? The BBG has developed a strong presence in Tanzania over the past […]

What do changes to the membership mix at the BBG say about recent developments in Tanzania’s business environment?

The BBG has developed a strong presence in Tanzania over the past decade, with: a coastal chapter based in Dar es Salaam and a northern one in Arusha. In the latter our membership comprises companies dealing mainly in the tourism, agriculture, manufacturing, transport, and mining sectors, while more multinationals are based in Dar es Salaam, and these make up the majority of our coastal chapter membership. In total, we have around 250 members. In general, we see more turnaround in the coastal chapter, with expats coming in and leaving. There is less movement in the northern chapter and many of our members are familiar faces in the business community. Our members learn about changes to the business environment through our planned events such as breakfast meetings or special events. Every year in May we host a trade fair for our members to promote their businesses and do business with BBG members. We also host “hot topics“ from which our members can benefit. As a result of our successful and informative activities for our members, we have seen membership growing.

What factors have recently impacted the business environment?

One major challenge affecting members is the illiquidity of the market. This has impacted us all over the past one to two years: we see fewer new entrants while more established businesses witness diminishing growth or in some cases are forced to restructure to survive. In particular, we have seen customer-facing companies most impacted, including in the telecommunications, FMCG, services, and tourism sectors. This last sector has also been impacted following the introduction of additional taxes. Having said that, we have also seen positive responses to this situation from local industries, since imports have reduced and in-house manufacturers have seen a resulting uptake in sales.

What approaches should be employed to facilitate business growth?

From a private-sector point of view, it is important for businesses to push innovation. Consumers are not going anywhere; they are just changing their patterns, habits, and where they spend their money. They will continue to purchase things. Thinking innovatively in the market, trying to predict customers’ actions, and staying ahead of the game; these are the secrets to success in the face of adversity. Many businesses in Tanzania are heading down this route, seeking to do things differently. Making products more accessible at lower costs helps us drive the top line. From the public sector, we need to see continued emphasis on private-public engagement. We need to create an environment that breeds openness and trust, which will provide a welcome predictability to the business world. If new regulations come into play, then these should be publicized at an early stage in order for companies to be prepared.

How do you view the recent announcement that around 47% of the current budget will be dedicated to infrastructure projects?

If the government succeeds in sourcing financing for all its infrastructure projects, it could create an enormous boost for the economy. Infrastructure is a pillar for growth in any economy. If we can access funds and deliver those projects, then such development will definitely take Tanzania to a different level. The confidence has to be in securing access to funds to be able to execute these projects.

What is your outlook for the growth of Tanzania’s economy?

The BBG remains optimistic, because it is clear that the intent of the reforms to Tanzania’s business environment is positive. Furthermore, the bottom line that Tanzania is ripe for investment still holds true. All the resources and the population—which is growing every year—are there. There is potentially a healthy middle class that can contribute more to the economy. All the ingredients for success are there; it is matter of having the right policies to enable the country to grow to its potential.



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