In a significant policy shift aimed at safeguarding local economic interests, the government of Tanzania has officially banned foreigners from engaging in a wide range of small-scale business activities within the country.
The new regulation, titled The Business Licensing (Prohibition of Business Activities for Non-Citizens) Order, 2025, was issued on July 28, 2025, under Government Notice No. 487A. It was signed by the Minister for Industry and Trade, Dr. Selemani Jafo.
According to the directive, non-citizens are now prohibited from operating or managing various grassroots-level businesses, including but not limited to:
Salons and barbershops
Small retail shops and eateries
Mobile money kiosks
Mobile phone repair services
Tour guiding and curio shops
Domestic, office, and environmental cleaning services
Small-scale mining activities
Parcel and postal delivery services
Museums, radio stations, and television stations
Real estate and business brokerage
Clearing and forwarding services
Direct purchase of crops from farms
Gambling businesses outside licensed casinos
Micro and small-scale industries
Penalties for Violations
The directive comes with stiff penalties for offenders. Foreigners found in breach of the regulation risk fines of up to 10 million Tanzanian shillings (approximately $3,898), up to six months’ imprisonment, or both. Additionally, their residence permits and visas may be revoked.
Tanzanian citizens who aid foreigners in circumventing the ban may also face fines of up to Tsh5 million ($1,949) or a jail term of up to three months.
Regional Concerns and Diplomatic Ripples
The Tanzanian government says the move is designed to protect local entrepreneurs and expand opportunities for its citizens. However, the regulation has sparked concerns across the East African Community (EAC), where member states have long championed free movement of people, goods, and services.
Kenya, which has over 40,000 of its nationals living and working in Tanzania—many of them in the informal business sector—may be among the countries most affected. Analysts warn that the ban could disrupt livelihoods, strain bilateral relations, and potentially trigger retaliatory policies.
Other EAC member states, including Rwanda, Burundi, South Sudan, Somalia, and the Democratic Republic of Congo, could also face economic fallout due to the new restrictions.
A Trend Towards Economic Nationalism
The directive is part of a broader economic nationalism agenda under President Samia Suluhu Hassan. In May 2025, the Tanzanian government banned the use of foreign currencies such as the US dollar for local transactions, mandating that all payments be made in Tanzanian Shillings (TZS).
While the latest measure may bolster domestic business participation, economists caution that it could undermine regional economic integration efforts and send mixed signals to investors.
The East African Community is yet to issue an official response to the development.
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