
Cross Border Agricultural Trade in Tanzania 2025 Report
Introduction
Liberty Sparks is a research-oriented think tank committed to fostering education and advancing the principles of a free-market economy. At the core of our initiatives is the Ujirani Mwema Project, a program dedicated to researching and advocating policy reforms for “trading across borders” in Tanzania. This project, funded by the ATLAS NETWORK and IATP, seeks to improve the business environment in Tanzania. The Ujirani Mwema Project targets key sectors, namely agriculture, mining, and manufacturing, with a focus on addressing challenges and recommending policy reforms starting with this report which is on agricultural trade. It is imperative to modernize the industry to bolster yields, facilitate exports, engage in value-added processing, and foster cross-border agricultural trade.
The agriculture sector in Tanzania confronts a multitude of challenges, remaining a top priority for the government’s developmental focus aimed at poverty reduction and increased productivity.
Taking the issue on board, the Liberty Spark[1] has come up with the cross border agricultural trade project that undertakes the extensive analysis of countries’ enabling environment for agricultural trade, i.e. the system of government policies, laws, regulations, and institutions that govern the cross-border movement of agricultural goods. This project therefore sets to improve the doing business in Tanzania to facilitate the cross border agricultural, mining and manufacturing trade while focusing on; administrative requirements, procedures, cost and time.
Objectives, Approach and Methodology
Liberty Sparks seeks to address the status and developments and challenges and identifying gaps in cross border trade with a view to informing policy makers on actionable policy reforms. The approach and methodology have entailed soliciting input from stakeholders, to refine the approach, gather insights on optimal strategies, and clarify the planned methodologies. To accomplish the study objectives, the consultant employed a blend of quantitative and qualitative methodologies, supported by comprehensive desk research and contributions of participants in consultative workshops. This research benefited from the resources provided by the International Trade Centre Tools (ITC Tools), namely TradeMap and Market Access Map (MacMap). This methodological approach empowered the Liberty Sparks’ project team and pertinent business stakeholders to grasp the intricacies and challenges confronting the cross-border agricultural business sector. The study relies on secondary data and information gathered through desk research, involving a review of current and past studies and reports on agricultural trade and contributions of various stakeholders in workshops.
Key Findings and Messages
- The agricultural sector has got higher budget which has tripled the growth of agricultural output thus accelerating to 4.5% per year and variety of crops have increased after benefitting from the use of subsidized fertilizers, the use of better seeds for 60%, better research, better extension services, the increased use of pesticides to monitor pesticides and availability of markets.
- Trading across borders provides an independent measurement of border regulations affecting business operations. The indicators produced by trading across borders initiate some functions and are used as a benchmarking tool to measure the performance of border services across economies. Economies with the most efficient trading environments allow traders to exchange information with customs and other control agencies electronically. To address challenges of barriers to cross-border trade, the Government of Tanzania, in collaboration with neighbouring countries and development partners is implementing the establishment of One Stop Border Posts (OSBPs) to facilitate trade and remove the barriers for movement of goods and people crossing borders.
- Analysis of market trends within the agriculture sector in Tanzania comprises various components, including consumption, export, and import analyses. Tanzania’s agricultural market is on an upward trend. Agriculture stands as the primary pillar of the country’s economy, constituting roughly 26% of Tanzania’s GDP and offering employment to 62% of its population. Private sector investment in the agriculture sector, collaborative research efforts with local institutions and policy initiatives implemented have enhanced the business environment and the development of Tanzania’s agricultural market and its potential. Further work is needed in the areas of reducing reliance on rain-fed agriculture, growing emphasis on climate-smart agricultural practices and improving access to agricultural finance and extension services. These are essential for empowering smallholder farmers and promoting inclusive growth in the sector.
- As food processing investments in Tanzania heavily rely on imported machinery and technologies, there is a significant demand for machinery and equipment across various sectors of food processing. This presents great opportunities for both importers and exporters.
- The government is actively eliminating unnecessary legal and regulatory challenges such as levies that hinder the sector’s growth, including cross-border agricultural trade focusing on productivity and value addition. Policies must prioritize empowering farmers, boosting agricultural output, and securing food security, while considering factors like soil quality, water access, market dynamics, and household preferences.
- The recent improvements to cross-border posts in Tanzania are aimed at addressing several pressing challenges that have long hindered efficient trade and border management by modernizing and streamlining cross-border operations, fostering economic growth, enhancing regional integration, and ensuring security along Tanzania’s borders. Improvements have addressed challenges of infrastructure deficiencies, informal trade and smuggling and security concerns. To address these challenges, cross-border improvements are transforming border operations and facilitating trade, mainly in infrastructure upgrades, automation and digitalization, enhanced border controls and taking security measures. These improvements have resulted in smoother cross-border trade operations, reduced trade barriers, increased revenue collection, and enhanced security at border crossings.
- The surge in intra-regional trade has been attributed to heightened agricultural production, resulting in increased exports among partner states driven by the elimination of Non-Tariff Barriers (NTBs) and a rise in intra-EAC trade for intermediate goods and enhancement of regional commerce. Tanzania has demonstrated strong competitive advantage in agricultural production and export within the EAC region.
- The collaboration of institutions emphasizing cross-border agricultural trade, reflects a concerted effort to address challenges, foster innovation, and promote sustainable cross border trade leaves some gaps to be addressed.
- Conclusions and Recommendations
- In conclusion, Tanzania’s agricultural sector has significant potential for growth and development. However, the sector faces challenges associated with productivity, sustainability, and resilience of the agricultural industry. The achieved increase agricultural output needs to be reinforced by improved quality of produce and expanded market opportunities for Tanzanian farmers embracing innovation.
- Recommendations
- Give high priority and dedicated attention to the development and enhancement of the agricultural sector, focusing on increasing productivity, efficiency and value addition with a view of bolstering incomes within rural communities and beyond
- Prioritize advancements in agricultural practices, technology, and infrastructure with view to fostering sustainable growth, creating productive employment opportunities, and ensure food security for current and future generations.
- Identify a diverse array of food crops that possess market potential within the region.
- Prioritize the quality of agricultural products observing measure like standards, barcoding technology and streamlining product identification and traceability processes,
- Harness the full spectrum of expanded market opportunities available to Tanzanian farmers.
- Place significant emphasis on organizing a comprehensive transformation of the economy, shifting it from a state of supply constraints to a dynamic and competitive export-oriented entity on both regional and global scales.
- Implement selective protection measures to create an enabling environment for localization to be the preferred strategy.
- Enhancing skill development is essential for driving quality improvement initiatives forward. This entails investing in comprehensive training programs aimed at equipping stakeholders across various industries with the necessary knowledge and expertise to implement quality enhancement practices effectively.
- Tax policies should be designed to promote domestic industries compared to their competing neighbours.
- Institutional arrangements should play a pivotal role in facilitating collaboration and coordination for effective policymaking and implementation:
- Conduct a comprehensive assessment to evaluate the implications and consequences of adopting non-dollar currencies, particularly by considering the currencies of neighbouring cross-border countries.
- Ensure implementation of the relevant laws and regulations that fall under different ministries and have a bearing in agricultural development. The laws and regulations are related to trade, environment, mining, lands, investment, livestock, forests, hunting and water resources. In particular, ensure the review, harmonization and formulation of different agricultural related laws, legislations and regulations
[1] The Liberty Sparks, an organization exclusively based in Tanzania, has been acknowledged as an associate member in the Economic Freedom World Report (EFW Report) of 2023. They collaborate with the network and the Fraser Institute on special projects aimed at promoting economic freedom in the country.