The World Bank’s in its Economic Update on Tanzania projects a growth of 5.8% in 2020 for Tanzania’s economy compared with an estimated 5.6% this year. For 2021, the Bank forcasts that the growth will rise to 6.1%. The estimate is lower than the government estimate of 7.1%. The International Monetary Fund economic growth projections were also lower than the projections given by Tanzanian government this year.
Tanzanian government invested billions of dollars in ambitious industrialisation drive that included construction of a new rail line, revival of the national airline and a hydro-power plant. In spite of this, foreign investment dropped significantly. State intervention in sectors such as mining and agriculture has been pointed out as the cause for the drop in FDI. The World Bank pointed out that foreign direct investment dropped by one-third, to $1.0 billion from $1.5 billion, between 2015 and 2018. The World Bank also urged the government to strengthen its fiscal management and keep a watch on spending pressures expected as a result of next year’s elections .
