We have to ensure our governments are stable and our streets are not pocked with violence, which turn potential investors away in droves.
Image: INTERNAL
There is a pattern so deeply embedded in African resource economies that it has become almost invisible. Dig it up, ship it out, watch someone else turn it into something valuable, then import that valuable thing back at a premium. Tanzania is not exempt from this pattern. But what makes Tanzania's current moment genuinely interesting is that the country appears, at last, to be building a serious policy framework to break it.
The recently published Manufacturing Africa report, developed in collaboration with Tanzania's Ministry of Minerals and grounded in over 50 interviews and workshops with public and private sector stakeholders, provides one of the most detailed and honest assessments of Tanzania's mineral value addition potential to date. Reading it carefully, one finds both genuine cause for optimism and a clear-eyed acknowledgement of the structural challenges that have frustrated similar ambitions across the continent for decades.
Tanzania's mineral sector already accounts for 10.1% of GDP and employs over 6 million people across production and related services. Those are not small numbers. What gives this moment its particular urgency is the intersection of two global forces that Tanzania did not create but can absolutely exploit.
The first is the global energy transition. Demand for critical minerals, graphite, rare earth elements (REEs), nickel, cobalt, and copper, is accelerating rapidly as the world scales up electric vehicles, battery storage, and renewable energy infrastructure. Tanzania holds 6% of the world's graphite reserves and significant deposits of neodymium-praseodymium (Nd-Pr) metals, both of which are essential inputs for EV motors and wind turbines.
The second force is supply chain diversification. China currently produces over 90% of the world's spherical graphite and over 70% of processed rare earth metals. Western governments, manufacturers, and investors are actively seeking alternatives. Tanzania, with its large reserves and relatively competitive energy costs, is a credible candidate. The question is whether it can convert geological endowment into industrial capacity before the window narrows
The Manufacturing Africa report identifies 14 specific value addition opportunities across 11 minerals, with a combined annual revenue potential of between $7.2 billion and $11.7 billion. To put that in context, that figure is not a theoretical projection based on global commodity prices alone. It is a bottom-up analysis of what Tanzania could realistically produce and sell if it develops the necessary processing, refining, and manufacturing capabilities.
The report usefully segments these opportunities into four categories based on ease of implementation and competitive positioning, and I think this framework is worth examining carefully because it captures a strategic logic that African policymakers often get wrong.
The so-called low-hanging fruit, cement, ceramics, glass, and paper derived from strategic minerals, represent $800 million to $1 billion in annual value and address growing regional demand. These are the opportunities that require the least investment and the shortest lead times. They are also, frankly, the opportunities that Tanzania should already be further along in developing. The fact that they are still categorised as 'opportunities' rather than operating industries is itself a commentary on the structural resistance that has held back African manufacturing.
The 'no-regret' opportunities, primarily gold bars and jewellery, carry a potential annual value of $4 billion to $7.5 billion. Tanzania is already a significant gold producer, and the refining infrastructure is largely there. The key barrier here is certification, specifically LBMA accreditation for gold bars, and the development of jewellery manufacturing capability. These are solvable problems. They require regulatory focus and targeted skills investment, not a wholesale industrial transformation.
The 'big bets', spherical graphite and Nd-Pr metals, are where Tanzania's long-term positioning in the global energy transition really lies. The Mahenge and Epanko graphite mines, each expected to produce over 60,000 tonnes annually, and the Ngualla Rare Earths Project, projected at 37,000 tonnes of REE metals per year, could make Tanzania a top-five global graphite producer by 2028. But these opportunities require substantial capital, access to processing technology, and partnerships with international players who hold the intellectual property for battery-grade materials. This is where the hard diplomatic and commercial work needs to happen.
Here is where I want to push beyond the optimism of the report and name some of the harder structural realities. The first is the technology access problem. Processing spherical graphite for battery anodes or separating Nd-Pr metals to magnet-grade purity is not simply a matter of building a facility. It requires proprietary technology that is largely held by Chinese, Japanese, and South Korean firms. Acquiring that technology, whether through licensing, joint ventures, or direct investment, requires Tanzania to offer something attractive enough to convince existing players to share capabilities that currently give them market dominance. That is a difficult negotiation, and it requires a level of industrial diplomacy that most African governments have historically underinvested in.
The second is the financing gap. The report rightly identifies that realising Tanzania's value addition potential will require critical investments over the next three to seven years. But African mineral processing projects have a difficult relationship with international capital markets. Perceived political risk, currency volatility, and infrastructure deficits push up the cost of capital in ways that make projects that would be financially viable in Australia or Canada marginal in Tanzania. Addressing this requires not just domestic policy reform but active work to reshape how international investors price risk in Tanzanian industrial projects.
The third, and perhaps most underappreciated, is the skills pipeline. Value addition is not just about physical infrastructure. It requires a workforce capable of operating, maintaining, and eventually improving processing facilities. Tanzania's education and technical training systems are not currently calibrated to this challenge. The 25,000 direct jobs the sector could create represent a significant opportunity, but only if there is a deliberate investment in building the human capital to fill them.
If Tanzania's value addition agenda succeeds, the economic impact is transformative: 9 to 15% GDP growth within seven years, over $1 billion in annual tax revenue, and tens of thousands of skilled industrial jobs. That is the kind of structural economic shift that changes a country's development trajectory for generations.
If it fails, Tanzania will have been sitting on some of the most strategically important mineral deposits on the planet during the most favourable demand environment in modern history, and will have exported the raw materials for someone else's industrial revolution. Africa has done that before. The question is whether Tanzania has the policy architecture, the institutional capacity, and the political will to make sure it does not happen again.
Written by:
*Chloe Maluleke
Associate at BRICS+ Consulting Group
Russia & Middle East Specialist
**The Views expressed do not necessarily reflect the views of Independent Media or IOL.
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