BMI View: Improvements to Tanzania ' s poor transport logistics network will be the main driver of construction industry growth throughout our 10-year forecast period, with interest in the country ' s nascent gas sector and the construction of the necessary export infrastructure expected only after 2020 owing to depressed commodity prices. The government will need to tackle allegations of corruption so as not to deter investors.
Forecast & Industry Developments
We are maintaining our forecasts of 7.6% real growth for 2016 and annual average growth of 7.4% in real terms over our five-year forecast period up to 2020. The development of transport infrastructure, supported by international funding flows, will be the primarily driver of construction industry expansion, as the government works to improve the country's poor logistics profile and capitalise on its maritime access.
Over our full 10-year forecast period we project annual average growth of 8.4%. Nominal industry value is projected to rise from an estimated USD5.1bn in 2015 to USD15.3bn in 2025, keeping Tanzania as the second-largest construction market in East Africa, behind Ethiopia.
Persistently low commodity prices and an uncertain regulatory environment continue to deter investment into the country's nascent gas sector.
Increasing activity in non-residential construction - particularly industrial and commercial developments - supports our outlook for strong industry growth.
|f=BMi forecast. Source: BMI|
|Construction industry value, TZSbn||11,861.03||13,379.24||15,172.06||17,315.87||20,110.65||23,348.47||27,039.86||31,236.45||35,993.76||41,666.38|
|Construction Industry Value, Real Growth, % y-o-y||7.55||6.80||6.30||7.63||8.89||9.10||9.81||9.52||9.23||8.76|
|Construction Industry Value, % of GDP||11.7||11.6||11.5||11.5||11.8||12.0||12.3||12.5||12.7||12.9|
Tanzania comes out eighth out of 17 markets in our Infrastructure Risk/Reward Index for Sub-Saharan Africa, with its score of 41.1 above the regional average of 38.9.
The country's underdeveloped banking sector means most infrastructure projects are reliant on donor aid or multilateral financial assistance.
An opaque business environment, underdeveloped transport links and inadequate poor supply remain the chief deterrents to entering the market.
|Risk/Reward Index||Rewards||Industry Rewards||Country Rewards||Risks||Industry Risks||Country Risks|
The Tanzania Infrastructure Report features BMI Research's market assessment and forecasts covering public procurement and spending on all major infrastructure and construction projects, including transportation and logistics by land, sea and air; power plants and utilities, and commercial construction and property development. The report analyses the impact of regulatory changes and the macroeconomic outlook and features competitive intelligence on contractors and suppliers.
BMI's Tanzania Infrastructure Report provides industry professionals and strategists, sector analysts, investors, trade associations and regulatory bodies with independent forecasts and competitive intelligence on the Tanzanian infrastructure and construction industry.
- Benchmark BMI's independent infrastructure industry forecasts for Tanzania to test other views - a key input for successful budgetary and planning in the Tanzanian infrastructure market.
- Target business opportunities and risks in the Tanzanian infrastructure sector through our reviews of latest industry trends, regulatory changes and major deals, projects and investments in Tanzania.
- Assess the activities, strategy and market position of your competitors, partners and clients via our Company Profiles (inc. SWOTs, KPIs and latest activity).
BMI Industry View
Summary of BMI’s key industry forecasts, views and trend analysis covering infrastructure and construction, regulatory changes, major investments and projects and significant national and multinational company developments. These are broken down into construction (social, commercial and residential), transport (roads, railways, ports, airports, etc), and energy & utilities (powerplants, pipelines and so on).
Industry SWOT Analysis
Analysis of the major strengths, weaknesses, opportunities and threats within the infrastructure and construction sectors and within the broader political, economic and business environment.
BMI Industry Forecasts
Historic data series (up to 2012) and forecasts to end-2024 for all key industry indicators, supported by explicit assumptions, plus analysis of key developments in the market and risks to the main forecasts. Indicators include:
Construction: Industry value (USDbn); contribution to GDP (%); total capital investment (USDbn); real growth (%).
Construction industry real growth forecasts (%) and industry value (USDbn) forecasts for industry sectors are split into Residential and Non-residential and Infrastructure sectors. Where the data is available for particular countries the infrastructure is further broken down into indicators for the transport subsectors of roads, railways, airports and ports and the energy and utilities sub-sectors of power plants and transmission grids, oil & gas pipelines and water infrastructure. This dataset is unique to the market.
The reports also include analysis of latest projects across the infrastructure sectors (transport, utilities, commercial construction).
BMI’s Infrastructure Risk Reward Index
BMI’s Risk Reward Index provides investors (construction companies, suppliers and partners) looking for opportunities in the region with a clear country-comparative assessment of a market’s risks and potential rewards. Each of the country markets are scored using a sophisticated model that includes more than 40 industry, economic and demographic data points. These provide indices of highest to lowest appeal to investors, with each position explained.
An assessment of the competitive landscape and key challenges to entering the market. Details of the largest companies active in the sector across the sub-segments of the industry, including the key financial figures from some of the largest players in the sector.
Examines the competitive positioning and short- to medium-term business strategies of key industry players. Strategy is examined within the context of BMI’s industry forecasts, our macroeconomic views and our understanding of the wider competitive landscape to generate company SWOT analyses. The latest financial and operating statistics and key company developments are also incorporated within the company profiles, enabling a full evaluation of recent company performance and future growth prospects.
The Infrastructure reports draw on an extensive network of primary sources, such as multilateral organisations, government departments, industry associations, chambers and company reports.
*Company profiles are not available for every country. Those reports instead contain information on the current activities of prominent companies operating in the market.