DAR ES SALAAM, Tanzania – Tanzania’s construction industry is set for a strong year of expansion, with projections indicating 7.1% real growth in 2025, driven by substantial investments across manufacturing, transportation, and energy infrastructure projects. The sector is expected to maintain this momentum with an average annual growth rate of 7.7% between 2026 and 2029, positioning construction as a cornerstone of Tanzania’s economic development strategy.
The growth trajectory follows an exceptional year for investment in 2024, which saw the Tanzania Investment Centre (TIC) register 901 investment projects totaling TZS 20.7 trillion (approximately $7.7 billion) – the highest investment value recorded since 1991. The manufacturing sector emerged as the dominant force, attracting TZS 8.4 trillion ($3.1 billion) across 377 projects, underscoring the country’s industrial transformation.
Transportation and Tourism Show Strong Investment Appeal
Beyond manufacturing, significant capital inflows have transformed Tanzania’s infrastructure landscape. The transportation sector secured TZS 3.2 trillion ($1.2 billion) for 138 projects, while commercial building projects attracted TZS 1.9 trillion ($706 million) across 91 developments. The tourism sector also demonstrated robust performance with 76 projects worth TZS 908.1 billion ($337 million), reflecting growing confidence in Tanzania’s hospitality market.
Major Infrastructure Initiatives Driving Growth
Several transformative projects are fueling the construction boom:
- The African Development Bank (AfDB) has committed TZS 6.7 trillion ($2.5 billion) to priority transport infrastructure, including the multinational Bagamoyo-Pangani-Tanga-Horohoro/Lunga Lunga-Mombasa road connecting Tanzania and Kenya
- Strategic road developments including the Nyakanazi-Kabingo-Kasulu-Kumnazi road in western Tanzania and the Mawala-Masasi road in the southern region
- Railway expansion featuring the Tabora-Kigoma-Uvinza line extending to Musongati, Burundi
- Aviation infrastructure development with the ongoing Dodoma (Msalato) International Airport project
Tanzania’s National Roads Agency (Tanroads) is implementing comprehensive traffic solutions in five major urban centers – Dar es Salaam, Mwanza, Arusha, Dodoma, and Mbeya. Key initiatives include expanding Dar es Salaam’s Bus Rapid Transit (BRT) system, constructing flyovers, and adding lanes to alleviate congestion.
Notable progress includes the nearing completion of Dodoma’s 112km Outer Ring Road, with additional expansions connecting the capital to Morogoro, Iringa, and Arusha. In Mwanza, the Mwanza-Usagara-JPM Bridge highway is being widened to four lanes, while similar expansions are underway along Mbeya’s TANZAM highway.
Strategic Regional Connectivity
Tanroads is currently managing over 15,000km of roads across major cities, with 1,300km already completed as of February 2025. New bypasses and bridges in Arusha and Kilimanjaro, along with advanced planning for bypass projects in Iringa and Songea, demonstrate the government’s commitment to enhancing national connectivity and supporting economic growth through improved infrastructure.
The convergence of public investment, international funding, and private sector participation creates a favorable environment for construction companies, material suppliers, and engineering firms looking to participate in Tanzania’s infrastructure transformation.
