Is Tanzania an Emerging Market? – TICGL

Executive Summary

Tanzania’s economic trajectory over the past decade raises a critical question for policymakers, investors, and development partners: Is Tanzania an emerging market, or does it still belong firmly in the frontier category?

A data-driven assessment of growth performance, macroeconomic stability, investment flows, financial market development, and infrastructure expansion suggests that Tanzania is transitioning decisively toward emerging market status, even if full recognition across all global indices has not yet been achieved.

Key Finding

Tanzania exhibits strong characteristics of an emerging market based on multiple economic indicators. The country has achieved mixed classification status: FTSE Russell classifies it as a Secondary Emerging Market (as of October 2025), while MSCI and S&P maintain Frontier Market classification.

Inflation & Macroeconomic StabilityYearInflation Rate (%)Assessment20155.6%Moderate20165.2%Well-managed20175.3%Stable20183.5%Excellent control20193.4%Below target20203.3%Strong stability20213.7%Controlled20224.4%Moderate20233.8%Good control20243.3%Excellent2025 (Projected)3.4%Stable outlook

Analysis: Inflation consistently below 5% target demonstrates strong monetary policy management and macroeconomic stability – a key emerging market characteristic.

Additional Stability Indicators (2024-2025)Indicator20242025 (Projected)Fiscal Deficit (% of GDP)2.5%2.5%Current Account Deficit (% of GDP)2.6%4.2%Public Debt (% of GDP)~50%~50%Foreign Reserves4+ months of imports4+ monthsCentral Bank Rate5.75%5.75%Capital Markets DevelopmentDar es Salaam Stock Exchange (DSE) PerformanceMetric202320242025 (Sept/Oct)GrowthMarket Capitalization (TZS)14.61 trillion17.87 trillion23.995 trillion+34%USD Market Cap$6.28 billion~$6.7 billion$7.42 billion+18%Equity Turnover (TZS)133.89 billion228.66 billion~686 billion~200% (tripled)Domestic Market Cap (TZS)11.40 trillion12.24 trillion-+7.4%Breakthrough Performance

The DSE showed exceptional growth in 2025, with market capitalization surging 34% and turnover tripling, signaling rapidly improving financial market depth and investor confidence.

Market Maturity AssessmentFactorStatusImpact on ClassificationForeign OwnershipNo aggregate limits✓ Supports emerging statusMarket Size$7.42 billion (growing)⚠️ Small but expanding rapidlyLiquidityTripled in 2025✓ Major improvementListed CompaniesLimited number⚠️ Constrains full emerging statusRegulatory FrameworkModern, investor-friendly✓ Strong foundationFinal Verdict: Is Tanzania an Emerging Market?Data-Driven Conclusion: YES

Tanzania qualifies as an emerging market based on comprehensive economic indicators and performance metrics.

Evidence Supporting Emerging Market Status:Economic Performance: Consistent 5-6% GDP growth, outpacing developed economiesMacroeconomic Stability: Inflation below 5%, controlled debt, stable fiscal positionInvestment Attractiveness: Highest FDI growth in East Africa (+28.3% in 2024)Market Development: DSE market cap +34%, turnover tripled (2025)Infrastructure Transformation: $2.5B+ in major projectsRising Income Levels: Per capita income up 49% since 2015Global Integration: Expanding trade, open investment policiesClassification Progress: FTSE Secondary Emerging status achieved (October 2025)Market Position & Timeline Outlook

Current Status: Tanzania is transitioning from Frontier to Emerging Market status. Economically, it demonstrates clear emerging market characteristics. In equity markets, it shows “pre-emerging” or “frontier-plus” status with FTSE’s Secondary Emerging classification confirming this upward trajectory.

Investment Implication: Tanzania represents a compelling opportunity for investors seeking exposure to high-growth African economies before they achieve universal emerging market recognition and associated premium valuations. The mixed classifications present a “value entry point” as the country progresses toward full emerging market status across all major indices.

Timeline Outlook: With sustained reforms, infrastructure investment, and market development, Tanzania could achieve full emerging market classification across all major indices within 5-10 years.

Vision 2050 Trajectory

Target: Upper-middle-income status by 2050

Progress Indicators:MilestoneStatusDetailsLower-middle-income status achieved✓ CompletedAchieved in 2020GDP per capita growth on track✓ On Track$929 (2015) → $1,380 (2025)FTSE Secondary Emerging upgrade✓ CompletedOctober 2025Infrastructure transformationIn Progress$2.5B+ investments underwaySustained 6%+ growth⚠️ CriticalNeed for next 25 years to 2050