Tanzania’s recent clampdown on foreign ownership of small-scale businesses has ignited diplomatic tensions with Kenya, raising fears of a looming trade dispute between the two East African neighbours.
Under new government regulations, Tanzania has barred foreign nationals from operating in at least 15 categories of businesses—including mobile money transfers, small-scale mining, tour guiding, crop buying, salons, and curio shops.
According to Business Insider Africa, the penalties for violations include heavy fines, up to six months’ imprisonment, and revocation of visas and work permits.
While Tanzanian authorities defend the move as a measure to protect local entrepreneurs and reduce competition in the informal sector, Kenyan officials have condemned the policy.
They argue it contravenes the East African Community’s (EAC) Common Market Protocol, which promotes the free movement of goods, services, and people across its eight member states.
“This could trigger retaliatory measures,” warned Bernard Shinali, Chair of Kenya’s National Assembly Trade Committee.
He noted that Tanzanians operate freely in Kenya’s mining sector and called for a reassessment of bilateral ties. Shinali added that Kenya’s parliament will summon the trade minister for a formal response.
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The economic stakes are high. Kenya exports a range of processed foods, machinery, and manufactured goods to Tanzania, while importing Tanzanian agricultural products, livestock, and minerals.
Thousands of cross-border traders also rely on unhindered commerce for their livelihoods. Analysts warn that the Tanzanian directive could erode investor confidence and disrupt the intricate supply chains that fuel regional trade.
The backlash extends beyond government corridors. Online, East African citizens have voiced frustration over what they view as a retreat from the region’s long-standing push toward economic integration.
Established in 2010, the EAC Common Market Protocol is designed to allow citizens from member states to live, work, and trade freely across borders.
Critics say Tanzania’s latest directive undermines this vision, calling into question the country’s commitment to regional cooperation.
As tensions escalate, the policy is increasingly seen as a critical test of the EAC’s unity and the resilience of its integration agenda.
Image Credit: DNE Africa
