Need a report that reflects how COVID-19 has impacted this market and its growth?
The Tanzanian construction market is expected to register a CAGR greater than 8% during the forecast period (2022 - 2027). According to the Bank of Tanzania's (BoT) quarterly economic bulletin, lending growth to the private sector by commercial banks fell to 2.3% in March 2021, owing to the impact of the COVID-19 outbreak on the demand and supply of various products. Building and construction, trade, agriculture, manufacturing, mining, and quarrying were among the economic activities that saw negative growth rates. Construction credit grew at a negative rate of -11.9%, while commerce credit grew at -10.3%, and farm credit grew at -8.1%.
The fact that Tanzania is creating infrastructure has raised its indebtedness in recent years, as more infrastructure projects are being built around the country. Fiscal spending in 2021 was USD 15.7 billion, with donors covering only 8% of the total. From 2021 to 2023, the government anticipates the economy to grow at a rate of 6.3%. Tanzania was promoted from a low-income country to a lower-middle-income country in July 2020, with the government hoping to reach middle-income status by 2030. Tanzania's government is working to develop its infrastructure, energy, and agriculture sectors in order to grow its economy and expand export opportunities. Tanzania's infrastructure development may help future generations as they grow up, enhancing Tanzania's ability to care for its citizens and providing a stable source of transportation and movement of people and goods around the country.
Industrial construction has remained a top priority in order to boost national self-sufficiency and enhance the domestic market for agriculture, livestock, fishery, forestry, minerals, and precious stones raw materials. Industrial construction is critical for job creation, technological transfer, and increased processed goods exports, in addition to enhancing self-sufficiency and boosting the domestic raw materials market. Through the TEMDO initiative, the value chain for several commodities and products has increased over the last decade, particularly for sugar and hemp. The TEMDO project entails the creation of cutting-edge technology for sugarcane and hemp product manufacturing and processing.
Scope of the Report
Construction is the installation, maintenance, and repair of buildings and other stationary structures, as well as the construction of roadways and service facilities that form fundamental components of structures and are required for their operation. Construction encompasses the processes involved in constructing buildings, infrastructure, and industrial facilities, as well as related operations, from start to finish. The Tanzanian construction market is segmented by sector (residential, commercial, industrial, infrastructure (transportation), and energy and utilities). The report offers market size and forecasts for the Tanzanian construction market in value (USD billion).
|Energy and Utilities|
Key Market Trends
Growth of Infrastructure Projects
Tanzania's government has announced that work on a USD 1.9 billion railway will commence across the country to improve the country's infrastructure and connect communities. The railway will be funded by loans, and the government has stated that it would neither raise nor impose any taxes on citizens to fund it. The railway is part of a bigger 1,219-kilometer railway network aimed at increasing Tanzanian trade with its neighbors. The segment approved by the government will connect two towns in central Tanzania, Makutopora and Tabora. The 1,219-kilometer railway line will connect Tanzania's Indian Ocean port of Makutopora with Tabora, a port city on the banks of Lake Victoria that Tanzania shares with Uganda and Kenya. Tanzanian President Samia Suluhu Hassan remarked during the project's introduction that the line would be a priority due to its importance in connecting the country to its neighbors. Tanzania's infrastructure development will aid in bridging the country's split.
Tanzania's government stated in January 2021 that a new railway line would be built in the country with Chinese businesses. The declaration, made a year earlier, brings China's involvement in Tanzania to more than ten years. According to the Tanzanian government, the train will run from Mwanza to Dar es Salaam, covering a distance of 341 kilometers from one end to the other. The announcement was made as part of a 2,561-kilometer network of new trains that will link Dar es Salaam to the rest of the country.
The projected Msalato International Airport (MSIA) in Tanzania is expected to begin construction in FY23. The Ministry has set aside around USD 14 million to help with the construction of Dodoma's next-generation international airport. The airport project also benefits from the Tanzanian Parliament's approval of a budget of nearly USD two billion for FY21. The proposed airport will be built on a 45-square-kilometer plot of land along the Dodoma-Arusha route, about 12 kilometers from the Dodoma CBD.
To understand key trends, Download Sample Report
Making Housing Affordable and Accessible in Tanzania
Providing inhabitants with quality and affordable housing is one of Tanzania's most pressing long-term development challenges. Despite expanding urbanization and rising demand for affordable housing and housing financing, government initiatives were only partially successful. Many Tanzanian low- and middle-income families have been forced to live in substandard or incomplete housing or rent for years, with little possibility of saving enough money to build or buy their own homes. The Tanzania Mortgage Refinance Company was established by the government to expand the housing finance industry (TMRC). The TMRC was helped by the Tanzania Housing Finance Project, which was funded by the International Development Association (IDA) and allowed it to provide medium- and long-term liquidity to mortgage lenders, making it easier for them to give loans to families looking to buy new homes or improve their existing ones.
In 2020, the International Finance Corporation (IFC) invested in TMRC with the support of the IDA Private Sector Window, further boosting affordable mortgage lending to create more affordable housing for Tanzanian families. The NHC, which is run by the government, is a key player in the country's housing supply. In 2020, the NHC built 1,164 commercial and residential properties, down 84 percent from 2019. Only 468 of the houses were affordable. In Dodoma, the new capital, 1,000 extra residences are being built with a $30 million investment. Watumishi Housing Company (WHC), a state-owned company, produced 70 residential units in Dodoma, with prices ranging from USD 19,709 for a studio to USD 39,246 for a three-bedroom apartment. In 2021, another 500 units were finished.
Despite this, 70 percent of Tanzanian housing is self-built, and many homes are constructed in stages utilizing self-help savings. As a result, there has been an increase in the number of poor structures. The NHC announced that, due to the public's poor purchasing capacity, it would increase the ratio of rental properties to for-sale homes from 30:70 to 80:20. The NHC intends to expand its building material manufacturing capacity in order to facilitate quality construction in the self-build sector and lower the cost of crucial materials for its low-cost house construction.
The construction market in Tanzania is fragmented with domestic and international businesses. Advent Construction Ltd, Estim Construction, Becco Limited, Salem Construction Limited, and Mohammedi Builders Ltd are just a few of the key competitors in the sector. The construction industry in Tanzania is characterized by a huge number of microentrepreneurs, the majority of whom work in the country's informal economy. The formal construction business in the country is made up of indigenous and indigenized corporations, as well as a number of big foreign civil engineering and construction firms.
January 2021: China Civil Engineering Construction Corporation and China Railway Construction Limited won the contract worth 3.0617 trillion shillings or USD 1.32 billion to build the railway.
March 2021: Between July 2020 and March 2021, ZIPA received 35 prospective investment projects in various sectors of the economy. Through thorough scrutiny, 30 projects were approved and issued with investment permits.
Table of Contents
1.1 Study Assumptions
1.2 Scope of the Study
2. RESEARCH METHODOLOGY
2.1 Analysis Methodology
2.2 Research Phases
3. EXECUTIVE SUMMARY
4. MARKET INSIGHTS
4.1 Current Economic and Construction Market Scenario
4.2 Technological Innovations in the Construction Sector
4.3 Insights into Supply Chain/Value Chain Analysis
4.4 Impact of Government Regulations and Initiatives on the Industry
4.5 Review and Commentary on the Extent of Government Infrastructure Development Schemes
4.6 Comparison of Key Industry Metrics of Tanzania with Other Countries
4.7 Comparison of Construction Cost Metrics of Tanzania with Other Countries
4.8 Impact of COVID-19 on the Market
5. MARKET DYNAMICS
5.4 Porter's Five Forces Analysis
5.4.1 Bargaining Power of Suppliers
5.4.2 Bargaining Power of Consumers/Buyers
5.4.3 Threat of New Entrants
5.4.4 Threat of Substitute Products
5.4.5 Intensity of Competitive Rivalry
6. MARKET SEGMENTATION
6.1 By Sector
6.1.4 Infrastructure (Transportation)
6.1.5 Energy and Utilities
7. COMPETITIVE LANDSCAPE
*List Not Exhaustive
7.2 Company Profiles
7.2.1 Advent Construction Ltd
7.2.2 Estim Construction
7.2.3 Becco Limited
7.2.4 Salem Construction Limited
7.2.5 Mohammedi Builders Ltd
7.2.6 CSI Construction
7.2.7 Milembe Construction Co. Ltd
7.2.8 Al Husseini Construction
7.2.9 Burusu Construction Ltd
7.2.10 Masasi Construction Co. Ltd
7.2.11 Imperial Construction Company
7.2.12 Tanpal Construction Ltd
7.2.13 Elerai Construction Company*
8. FUTURE OF THE MARKET
9. MAJOR INFRASTRUCTURE DEVELOPMENT PROJECTS (PROJECT DESCRIPTION, VALUE, LOCATION, SECTOR, AND CONTRACTORS)
9.1 Existing Infrastructure
9.2 Ongoing Projects
9.3 Upcoming Projects
You can also purchase parts of this report. Do you want to check out a section wise price list?
Frequently Asked Questions
What is the study period of this market?
The Tanzania Construction Market market is studied from 2018 - 2027.
What is the growth rate of Tanzania Construction Market?
The Tanzania Construction Market is growing at a CAGR of >8% over the next 5 years.
Who are the key players in Tanzania Construction Market?
Advent Construction Ltd, Estim Construction, Becco Limited, Salem Construction Limited, Mohammedi Builders Ltd are the major companies operating in Tanzania Construction Market.