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Zanzibar’s economy is dominated by the services sector, led by tourism activities. Tourism contributes an estimated 27% to its GDP and about 80% of its foreign exchange earnings
Zanzibar recorded impressive economic growth between 2009 and 2023, with real GDP per capita growing at an average rate of 3% a year. Living conditions also improved, with substantial increases in secondary school enrolment and access to electricity. But only half the increase in growth domestic product (GDP) per capita translated into increased household consumption and better welfare, according to a World Bank Poverty Assessment Report from Zanzibar, dating back to 2019.
Zanzibar’s economy is dominated by the services sector, led by tourism activities. Tourism contributes an estimated 27% to its GDP and about 80% of its foreign exchange earnings. The numbers of jobs directly or indirectly linked to the tourism sector are estimated at 60,000 out of a total of 600,000 people who appear to be employed on the islands
The dramatic increase in access to electricity was one of the drivers of poverty reduction. The proportion of households with access to the main grid grew from 38% to 57% between 2009 and 2019 with another 6% having access to solar power (mostly in rural areas). The proportion of households relying on paraffin or kerosene lamps for their lighting halved.
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The report shows that recent education reforms, including the abolition of school fees, had a highly positive impact on enrollment: average levels of education in the working-age population rose by 0.6 completed school years. The report shows that increasing returns on secondary and tertiary education played a role in poverty reduction.
