Tanzania’s Budget 2026/27 : A new era of value addition and economic transformation

“All the wealth of this country is the inheritance of Tanzanians and must serve the interests of Tanzanians.” These words by Julius Nyerere continue to resonate in discussions surrounding the nation’s natural resources, particularly the mining sector, which remains one of the pillars of Tanzania’s economy. In the 2026/27 budget presented by Anthony Peter Mavunde, the government has made its intentions clear: Tanzania is now focusing on value addition, stronger resource management and expanding the contribution of the mining industry to national economic growth.  

Over the past few years, the mining sector has remained among the fastest-growing sectors of the Tanzanian economy. Government statistics indicate that the sector’s contribution to Gross Domestic Product (GDP) increased from 7.2 percent in 2021 to more than 10 percent by 2025, demonstrating the increasing strategic importance of mining to Tanzania’s development agenda. Gold continues to dominate mineral exports, with Tanzania maintaining its position among Africa’s leading gold producers.

According to data from the Bank of Tanzania, gold exports surpassed USD 3 billion in 2024/25, compared to approximately USD 2.5 billion just a few years earlier. The growth has been driven by increased production, rising global gold prices and improved management of mineral trading within the country. Tanzanite, Tanzania’s unique gemstone found only in the country, has also continued to strengthen Tanzania’s global reputation, with export earnings rising due to tighter controls and improvements in formal mineral trading systems.

In the past five years, the government has established more than 40 mineral markets and buying centers across the country. This initiative has significantly improved transparency in mineral trading, reduced smuggling and enabled small-scale miners to sell their minerals at competitive prices. Areas such as Geita, Chunya, Kahama, Tunduru, Mirerani and Songea have become important mineral trading hubs, creating opportunities for thousands of Tanzanians to increase their incomes and participate directly in the sector.

The 2026/27 budget now seeks to take the mining sector to another level — transforming Tanzania from a country that exports raw minerals into a regional hub for mineral processing and value addition. The government has placed strong emphasis on investments in gold refining, copper processing, nickel production and other strategic minerals essential for modern technologies.  This is particularly important at a time when the global economy is shifting toward electric vehicles and clean energy technologies that depend heavily on minerals such as nickel, graphite and rare earth elements.

Strategic projects including the Kabanga Nickel Project led by Tembo Nickel Corporation, as well as the Liganga and Mchuchuma projects, have received significant attention in this year’s budget. The government believes these projects could position Tanzania as a major global supplier of critical minerals needed for advanced technologies and industrial transformation.

One of the most significant strategic investments highlighted in Tanzania’s mining sector is the Mbeya Niobium Project, located at the Panda Hill deposit in Mbeya Region. Niobium is a critical industrial mineral used in advanced steel production and high-tech applications, making it highly valuable in global supply chains. The project represents a major step in positioning Tanzania within the niche market of strategic and high-value minerals. It is structured with a government free-carried interest of 16 percent and is expected to significantly strengthen Tanzania’s role in supplying critical minerals to global markets.

The project is projected to generate approximately TSh 2 trillion in government revenue over its lifetime through taxes, royalties, levies, and government equity participation. It is also expected to create substantial economic linkages, including around USD 1.77 billion in local procurement opportunities for Tanzanian firms. In terms of employment, the project is projected to generate about 1,600 direct jobs and more than 6,336 indirect jobs across supporting sectors such as logistics, construction, and services. These figures highlight the project’s significance not only as a mining venture but also as a major driver of industrial and local economic integration.

The mining sector’s achievements are also reflected in government revenues. Collections from taxes, royalties and mining-related fees have continued to rise year after year, helping finance development projects in health, education and infrastructure. At the same time, the expansion of digital systems in licensing, mineral trading and export monitoring has reduced revenue leakages and increased transparency across the sector.

However, despite these achievements, significant challenges remain. Small-scale miners, who form the backbone of employment in the mining industry, still face limited access to capital, modern technology and technical training. The government must continue investing in empowering artisanal and small-scale miners so they can benefit more from the sector’s rapid growth. Environmental protection and mine safety also require continued attention to ensure that mining expansion does not come at the expense of communities and ecosystems.

Overall, Tanzania’s 2026/27 Minerals Budget reflects a country with a new economic vision, one that seeks to transform its natural resources into a foundation for industrialization, job creation and long-term national prosperity. With the current pace of reforms, strategic investments and stronger governance, Tanzania is increasingly positioning itself to become one of Africa’s emerging economic powers through the strength of its mineral wealth.

Alli Msangi is an Audit Senior Associate with Deloitte Consulting Limited. The views presented are his own, not necessarily those of Deloitte. He can be reached at amsangi@deloitte.co.tz