Tanzania has imposed sweeping restrictions on foreign participation in small-scale commerce, banning non-citizens from operating in 15 business sectors ranging from retail trade and mobile money to parcel delivery and tour guiding.
- •The Business Licensing (Prohibition of Business Activities for Non-Citizens) Order, 2025, published Monday in the nation’s gazette, forbids licensing authorities from issuing or renewing permits for foreigners in a wide range of micro and small enterprises.
- •Existing licenses will remain valid only until their expiry, after which foreigners must exit the prohibited sectors.
- •The order targets low-capital, service-oriented ventures that have seen increasing foreign participation in recent years.
Non-citizens are prohibited from operating wholesale and retail shops (excluding supermarkets), mobile money transfer services, electronic repair businesses, salons, tour guiding operations, and small-scale mining. They are also prohibited from running micro and small industries, local brokerage or real estate agencies, clearing and forwarding businesses, on-farm crop purchasing, and operating museums or curio shops.
Violations of the guidelines carry fines of up to 10 million Tanzanian shillings (about KSh 495,000), potential jail terms of up to six months, and the revocation of visas and residence permits. Moreover, Tanzanians found aiding non-citizens in partaking these businesses will also face lighter penalties but could also be fined or jailed.
The new restrictions mark a significant escalation of Tanzania’s drive for economic localization, aimed at reserving small-scale trade and services for its citizens. The policy is likely to disrupt expatriate-owned shops and informal enterprises that have proliferated in urban and border regions, while reinforcing local dominance in grassroots commerce.
The measures aim to reshape the investment climate, particularly for small and medium foreign investors from neighboring East African countries and Asia, who have gravitated toward Tanzania’s consumer and logistics sectors. The ban could also unsettle segments of the mobile money ecosystem, on-farm crop purchasing, and parcel delivery market, where foreign players have been active.
In May this year, Tanzania also banned the use of foreign currency in carrying out domestic transactions in the East African country. These rules set by the Bank of Tanzania (BoT) made it illegal to set, advertise, or quote prices in foreign currencies. They are also not allowed to turn down payments made in Tanzanian shillings.
The government’s strategy reflects a broader regional trend of tightening local-ownership rules to shield domestic enterprises. The order has been lauded by Tanzanian traders, who regard it as a necessary action to weed out ‘unnecessary’ competition in small-scale enterprise.
Other African countries with similar restrictions on specific small business participation for foreigners include South Africa, Zimbabwe, Ghana, Nigeria, Eswatini, Zambia and Botswana.
However, Kenyans on social media have vented against the order — seeing it as a betrayal of regional integration that aims to ease inter-border commerce. Similar restrictions are not existent in other EAC countries where Tanzanians are free to engage in any legal business they intend to do.
