Tanzania bans foreigners from running small businesses to preserve citizens' livelihoods
Tanzania has introduced a policy restricting foreigners from participating in certain small business sectors to empower local citizens.
The new regulation, effective from 2025, includes penalties such as fines, imprisonment, and potential deportation for violators.
The movement aims to protect grassroots economics but has raised concerns within the East African Community about regional trade impacts.
Tanzania has enacted sweeping new restrictions barring foreigners from operating a broad range of small businesses, in a move aimed at protecting grassroots economic activity and preserving opportunities for local citizens.
The new regulation, Business Licensing (Prohibition of Business Activities for Non-Citizens) Order, 2025, was officially published on July 28, 2025, under Government Notice No. 487A, and signed by Dr. Selemani Jafo, the Minister for Industry and Trade.
Under the directive, foreigners are prohibited from participating in 15 specific business sectors considered critical to grassroots economic empowerment. These sectors, traditionally dominated by Tanzanians, are seen by the government as vital to local job creation and income generation.
Among the prohibited activities for non-citizens are:
Operating salons, small retail shops, eateries, and mobile money transfer kiosks
Running mobile phone repair businesses
Providing tourism-related services such as tour guiding
Offering domestic, office, and environmental cleaning services
Engaging in small-scale mining and local parcel/postal delivery
Operating curio shops, museums, radio and TV stations
Acting as brokers or agents in real estate or business transactions
Participating in clearing and forwarding services
Buying crops directly from farms
Running gambling operations outside licensed casinos
Owning or managing micro and small industries
The regulation introduces fines of up to Tsh10 million ($3,898), imprisonment of up to six months, or both, for violators. Additionally, foreign offenders may have their residence permits and visas revoked. Tanzanian citizens who assist non-citizens in these restricted activities also face penalties, including a Tsh5 million fine ($1,949) or up to three months in jail.
The government says the restrictions are part of a broader push to empower Tanzanians economically, but the move has stirred unease across the East African Community (EAC), where such unilateral restrictions are often viewed as non-tariff barriers to regional trade and integration.
With at least 40,000 Kenyans living and working in Tanzania, many of whom operate in the informal economy, the new restrictions are expected to hit livelihoods and strain bilateral relations.
Other member states, including Rwanda, Burundi, South Sudan, Somalia, and the Democratic Republic of Congo, may also see their nationals affected.
There are growing fears that the move could prompt tit-for-tat responses from neighbouring countries, jeopardising regional cooperation.
The crackdown on foreign participation in small-scale economic activities is part of a broader wave of nationalist economic policies under President Samia Suluhu Hassan's administration.
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