Doing Business in Tanzania

Tanzania is one of the fastest growing economies in Africa and doing business here offers excellent opportunities. First, it is important to get to know the business culture in Tanzania well. And it is equally important to have a local business partner in Tanzania who would know all the important bureaucrats, politicians and businessmen you should know about in the country, which would allow you to set up business with a greater degree of success.

There are also certain important things you should know about the Tanzanian society – such as the fact that they are very traditional and family oriented. They are very hierarchy minded and senior executives in a Tanzanian business should be shown deference, both for a higher position and also for their advanced age.

The business environment in Tanzania has improved quite a lot over the last couple of decades as the country has shifted from socialism of old to free market capitalism. While it is true that it is still not perfectly easy to do business here and there is a plenty of corruption to reckon with, the situation is certainly much better than it was, say, in the 1990s, and infinitely better than it was in the 1980s or earlier.

Networking is critical to a successful businessman in Tanzania. If you intend to shift base to the country or shall be opening a local branch for your company there, be sure to join the local Tanzanian chamber of commerce, Rotary Club, industrial association or trade organization.
Tanzanian business partners value getting to know you better and place a lot of importance on their personal equations with you. For them, they have to trust you first, and see you as a friend, if they are to form a business partnership with you. This is so because in Tanzania, all business is personal and a business partner is essentially a personal friend.

This might be strange to you if you are coming from a Western society, but if you want to business in Africa it’s important to do things from the African perspective. So never display impatience or irritation during your dealings with your Tanzanian business partner, and it certainly wouldn’t hurt for you to be polite and friendly in exchange for all the warmth you are likely to receive from them.

Loss of face is an important concept in Tanzanian society, be very careful never to criticize a Tanzanian business partner in public. If you have a serious disagreement, be sure to communicate your thoughts privately, and even so express your grievances as softly as possible, without raising your voice. The loud and brash business culture associated with American business executives won’t work in traditional and conservative societies in Africa, where people value their personal equations more important than profit or money.

There are other things to be kept in mind while negotiating with your Tanzanian business partner. There is no definite deadline for anything in Tanzania. Deadlines are fluid and can be changed as per convenience. When this happens, don’t express irritation or anger. Just grin and bear it, for your work will certainly be done. Patience really is a virtue when doing business in Tanzania.

Also, Tanzanian business executives take a long time to agree to a proposal or to form business partnerships. So, once again, it’s important to be patient. But decisions once made are irrevocable and adhered to.

This article is a part of our ongoing series on “Doing Business in Africa”. Our goal is to inform people about the right way to form a business partnership with local business partners in the vast African continent, and to offer a better understanding of the business culture and etiquette followed in that part of the world. The intention is to ensure that you are comfortable and know what to expect during a business negotiation with a business partner in Africa. Please send us your suggestions on how we may help to serve you better. Ciao!