Tanzanian CEOs show optimism for local economic growth with 81% expecting improvement, despite global uncertainties. While 59% anticipate global economic recovery, caution remains due to inflation and geopolitical risks. Business leaders are focusing on innovation and sustainability, with a significant portion of revenue coming from core units. Tactical shifts towards AI and climate initiatives are evident, but challenges like financing and regulatory hurdles persist.
Business leaders in Tanzania are expressing optimism regarding the nation’s economic future amid global uncertainties, inflation, and cyber threats. According to PwC’s 28th Annual Global CEO Survey: Tanzania Perspective, 81% of CEOs anticipate local economic improvement over the next year, showcasing significant resilience and adaptability within the business community.
Zainab Msimbe, PwC Tanzania Country Senior Partner, emphasized the proactive approach of Tanzanian CEOs, noting that they are not merely reacting to challenges but are proactively reshaping strategies for sustained growth. “This year’s survey reveals a leadership community that is determined to not only survive but also thrive despite global uncertainties,” she stated.
Despite the generally positive outlook, CEOs express caution regarding the global economy. While 59% foresee improvement in global economic conditions, many remain concerned about inflation and market instability. Furthermore, 31% of CEOs feel particularly vulnerable to regional geopolitical conflicts, a rise from 24% the year before, illustrating the continued external risks.
Donald Mmari, REPOA’s executive director, pointed out that despite their optimistic outlook for the local economy, Tanzanian CEOs are aware of vulnerabilities from international conflicts that may disrupt trade and supply chains. Adapting their business models has become key, with 53% of leaders believing that their firms will be viable for over a decade due to strong strategic decisions and the integration of new technologies.
Moreover, the survey indicates that 85% of Tanzanian CEOs derive the majority of their revenue from core business units, with 55% reporting market share growth over the past five years. Many are now venturing into sectors such as insurance (30%), consumer markets (20%), and technology (17%), reflecting a willingness to explore new avenues in response to dynamic market conditions.
Paul Makanza, former chairman of the Confederation of Tanzania Industries, remarked on the proactive measures taken by business leaders to adapt to market pressures. “Many are reallocating resources to strengthen their businesses, but at the same time, they are being cautious in their approach,” he added.
Artificial intelligence (AI) and digital transformation are increasingly central to business strategies in Tanzania. The report reveals that 52% of CEOs expect AI to enhance profitability over the next year, with 45% believing that AI will become integral to key business processes, indicating a shift towards automation and enhanced operational efficiency.
Philip Besiimire, managing director of Vodacom Tanzania, noted the tangible impacts of AI on business operations, stating, “Business leaders indicate that investments in GenAI have led to increased profits and greater efficiency in work processes.”
Regarding decision-making, 81% of Tanzanian CEOs prioritize transparency and long-term strategy. Many are incorporating multiple perspectives to ensure they are seizing crucial opportunities before implementing financial or operational changes.
Efforts towards sustainability are also increasing, with 32% of CEOs reporting revenue growth from climate-friendly initiatives. However, challenges related to financing, regulatory complexities, and limited external demand hinder further progress. Ms. Msimbe commented on these challenges, stating, “While companies globally are seeing benefits from climate-friendly investments, Tanzanian businesses face regulatory and financial hurdles that limit their ability to implement sustainable strategies.”
The survey found mixed sentiments regarding sustainability costs; while 22% of CEOs claim climate-friendly investments have reduced operational costs, another 22% note increased expenditures. This suggests that while some companies are benefiting financially, others encounter limitations due to high initial costs and financing barriers.
As Tanzania approaches 2035, the economic landscape’s evolution will hinge on how businesses adapt to technological advancements, geopolitical shifts, and sustainability challenges.
In conclusion, Tanzanian business leaders display a commendable level of optimism regarding the local economy, remaining adaptable amid global uncertainties. While challenges such as inflation and geopolitical tensions persist, the focus on innovation, sustainability, and strategic decision-making underscores a strong resolve for long-term success. The findings from PwC’s survey highlight the importance of adaptability and proactive measures in navigating the evolving economic landscape, as Tanzanian firms strive to embrace new opportunities for growth and resilience.
Original Source: www.thecitizen.co.tz
