Tanzania business captains upbeat despite global upheavals

Speaking during the report’s launch in Dar es Salaam on Tuesday, PwC Tanzania Country Senior Partner Zainab Msimbe highlighted the determination of Tanzanian business leaders to reinvent their strategies for sustainable growth.

“Tanzanian CEOs are no longer just reacting to challenges; they are actively rethinking their strategies and reshaping their businesses to drive long-term growth,” she said.

“This year’s survey reveals a leadership community that is determined to not only survive but also thrive despite global uncertainties.”

Ms Msimbe added that many business leaders are now investing in innovation and new business models to adapt to shifting market conditions.

Despite the positive outlook for the local economy, CEOs in Tanzania remain cautious about the global economic landscape.

The report shows that while 59 percent of CEOs expect global economic growth to improve, many are still wary of inflationary pressures and market instability.

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Additionally, 31 percent of CEOs feel highly exposed to geopolitical conflicts in the region, an increase from 24 percent last year, with inflation and cyber risks remaining key threats for 28 percent of business leaders.

REPOA executive director Donald Mmari noted that while business confidence is high, external factors continue to pose challenges.

“Despite their optimistic outlook on the local economy, Tanzanian CEOs may feel vulnerable to spillovers from geopolitical and regional conflicts that could disrupt their trade and supply chains,” he said.

With the growing need for adaptability, many CEOs are focusing on reinventing their business models to remain competitive.

According to the report, 53 percent of business leaders in Tanzania believe their companies will be economically viable for more than ten years.

This confidence is largely driven by internal and external factors, including strong strategic decision-making, increased demand for products and services, and the adoption of new technologies.

The survey also highlights that 85 percent of Tanzanian CEOs generate most of their revenue from their core business units.

However, 55 percent reported an increase in market share over the last five years, with many expanding into new sectors such as insurance 30 percent, consumer markets 20 percent, and technology 17 percent.

This trend underscores the willingness of businesses to explore new opportunities in response to shifting market dynamics.

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Former Confederation of Tanzania Industries (CTI) chairman Paul Makanza highlighted the proactive approach of business leaders in adapting to market demands.

“A significant proportion of CEOs have taken action in recent years to adjust their business models due to the pressure to change,” he said.

“Many are reallocating resources to strengthen their businesses, but at the same time, they are being cautious in their approach,” Mr Makanza added.

Artificial intelligence and digital transformation have also become central to business strategy in Tanzania.

The report reveals that 52 percent of CEOs expect AI to boost profitability within the next year, while 45 percent trust AI to be embedded into key business processes.

This demonstrates a significant shift towards automation and efficiency in business operations.

Vodacom Tanzania managing director Philip Besiimire highlighted how AI is already impacting companies.

“Business leaders indicate that investments in GenAI have led to increased profits and greater efficiency in work processes. This trend is expected to continue as more companies integrate AI into their operations,” he noted.

In addition to AI, companies are taking strategic approaches to decision-making.

The survey found that 81 percent of CEOs in Tanzania are prioritizing transparency and long-term strategy in their major business decisions.

Many CEOs are now integrating multiple perspectives and evaluating whether they are missing critical opportunities before making financial or operational changes.

On the sustainability front, many Tanzanian CEOs are investing in climate-friendly initiatives, with 32 percent reporting increased revenue from such efforts.

However, challenges such as lack of financing, regulatory complexities, and limited external demand remain significant barriers.

Ms Msimbe pointed out the difficulties businesses face in implementing climate-conscious strategies.

“While companies globally are seeing benefits from climate-friendly investments, Tanzanian businesses face regulatory and financial hurdles that limit their ability to implement sustainable strategies,” she said.

The report also highlights that 22 percent of Tanzanian CEOs say climate-friendly investments have helped reduce their operational costs, while another 22 percent believe such investments have increased costs.

This mixed sentiment suggests that while some companies are seeing financial benefits from sustainability efforts, others are still struggling with high initial costs and limited access to financing.

The report revealed that as Tanzania moves toward 2035, the economic landscape will depend on how businesses navigate technological advancements, geopolitical changes, and sustainability challenges.