Tanzania is a low-middle income country in East Africa that benefits from a stable macro-economic framework. The economy depends heavily on agriculture, which provides employment for a majority of the nation’s population, but accounts for only one quarter of the gross domestic product (GDP).
Although Tanzania has abundance of natural resources, good weather conditions, long coastal line and big lakes, as well as a strategic geo-position as a getaway for landlocked countries, Tanzania’s economy is still very weak in terms of added value. An economic transformation, which requires investment, new technologies and skilled labour, is needed to address the fundamental challenges of sustainable development in Tanzania.
While the poverty rate has recently declined, after COVID-19 initially pushed the rate up, the absolute number of the poor remains high given that the population growth continued to increase faster than the rate of poverty reduction.
45 years of cooperation between Tanzania and the EU have broadly confirmed the alignment and common interests between the country’s development objectives and the EU policy priorities. This partnership should be sustained by a regular and respectful political and policy dialogue aimed at consolidating trust, as well as the rollout of development cooperation involving Government and local authorities, civil society and the private sector.
Tanzania and the EU share a common interest in ensuring peace, security and – national and regional – stability but also environmental protection and reduction in CO2 emissions in the context of global climate change, considering the now well-known risks of internationalisation of conflicts and migratory crisis.
Given the natural alignment of interests between Tanzania and the EU, the following three priority areas of cooperation were agreed on:
Green deals are partnerships, in particular between the public and private sectors, that create sustainable economic development – meaning inclusive, ethical and respectful of the environment in the long-term. This concept echoes the willingness of the Government of Tanzania to promote economic transformation, infrastructures and export-orientation, in partnership with the private sector. Green recovery is all the more relevant in a context of post-COVID-19 crisis and as a means to address its socio-economic impact. Productive sectors have an important role in this recovery but a particular attention will be given to sustainable agriculture, fisheries and forestry, as well as tourism, linked to environmental protection and climate resilience.
Human capital and employment
Central to Tanzania’s development strategies, with this priority area we will contribute to providing individuals, in particular women and youth, with the minimal decent living conditions as well as employment opportunities, making use of the following set of instruments:
Skills development is a major expectation from the public and private sectors with regard to the performance of the institution or company. Social protection is equally necessary to provide minimum social services and well-being to poor households whilst promoting financial inclusion and economic empowerment. Social protection and economic empowerment furthermore address one of the root causes of migration and violent extremism and contribute to peace and security while fostering green jobs.
This priority area broadly encompasses a number of actors and the nature of interventions. Looking at three categories of actors, Government/local authorities, civil society and private sector, it is proposed to support Government/local authorities systems, their performance and accountability, for improved service delivery at the national and local level, contribute to an inclusive and open society with social accountability and the rule of law and further improve a conducive business environment for private sector investment and trade.
The Multiannual Indicative Programme (MIP) for Tanzania for 2021-2024 amounts to €426 million.
Priority area 1: ‘Green Deals’ aims to promote sustainable businesses in the Blue Economy and the sectors of Agriculture, Forestry and Fishery while ensuring the well-being of environmental protection, climate resilience and tourism with the upper goal of encouraging the creation of green and smart cities for the benefit of all the communities and businesses involved.
Priority area 2: ‘Human capital and employment’ helps to enhance employability and entrepreneurship through skills development, to contribute to poverty reduction and economic empowerment through financial inclusion and social protection and to foster green jobs creation through SMEs development.
Priority area 3: ‘Governance’ advocates to support Government systems to deliver effective policy development and implementation with the result of contributing to social accountability and the rule of law for an inclusive society and making the business environment more conducive to private sector growth and increasing investment and trade.