Investment Opportunities in Zanzibar

The following investment opportunities are a part of 2018 Investment guide from the Zanzibar Investment Promotion Authority (ZIPA); for full document of the investment guide, please download it from the link below:

Zanzibar has a wide range of investment opportunities in different areas including tourism, agriculture, fisheries, real estate development and light industries.The section below details the opportunities in different sectors.

1.0 Tourism

Zanzibar has a competitive advantage in the tourism industry because of its nature, cultural heritage, history and renowned tradition of hospitality. The ZSGRP III (MKUZA III), calls for innovativeness, creativity, high-quality products and services that offer unique, engaging and memorable experiences and value for money in a clean, safe and welcoming environment.

The tourism sector boasts of a wide variety of tourism options, from the historical and cultural sites such as Old Stone Town, to beaches and leisure activities. For some of these opportunities, ZIPA is open to support and facilitate entering into partnerships with private business people through PPP.

1.1 Tourism Opportunities

  • Up-market hotels/resorts
  • Chain hotels
  • Sports tourism
  • Conference tourism
  • Health tourism
  • Mariners
  • Special cuisine restaurants (Joint venture)
  • Recreation and amusement centres
  • Tour operation (locals only)
  • Establishment of colleges for hospitality industry
  • Construction of exhibition and convention centres (PPP)
  • Ecotourism related to botanical gardens and city parks at Masingini, Ngezi and Jozani (PPP)
  • Development and renovation of historical buildings and sites (PPP)

2.0 Agriculture

While the contribution of agriculture to the overall GDP of many developing countries has been declining, the sector contribution in Zanzibar is going up. OCGS provisional data indicates that from 25.7 % in 2016, the sector contribution rose to 28 % in 2017. This achievement is due to the significantly higher increases in agricultural, forestry and fish prices for Zanzibar’s products. MKUZA III calls for application of modern technology to increase production and productivity

and ensure food security. Among the factors of success in this sector are fertile land and good tropical weather. The climate allows different types of crops, vegetables, and fruits to be grown. For centuries, Zanzibar has been exporting quality exotic home grown spices to the world market. The most famous of these spices include cloves, cinnamon, cardamom, nutmeg, black pepper and chilies.

2.1 Agriculture opportunities

  • Processing of spices and value addition including byproducts such as perfumes, perfumed soaps, medication and food processing
  • Fruit farming, processing and canning
  • Exportation of fresh fruits such as banana, oranges, rambutans, dorians, mangoes and pineapples.
  • Horticulture production
  • Vegetable production through hydroponics techniques
  • Agro-processing and value addition
  • Investment in the mechanization and irrigation of agriculture (PPP)
  • Storage facilities for produce and pest control (PPP)
  • Certification laboratory
  • Improvement of livestock infrastructure and small stock keeper project (PPP)

3.0 Livestock & Animal Husbandry

Zanzibar has a high demand for animal products such as milk, mutton and beef. Poultry products such as chicken and eggs are also on high demand. For this, the country has opened its doors for investment in this sub-sector. According to the National Sample Census of Agriculture 2007/2008, cattle were the most dominant animals farmed in Zanzibar amounting to

155,624 (68%) mainly of the indigenous type followed by goats which totaled to 68,972 (30%).

3.1 Livestock Opportunities

  • Dairy farming
  • Animal feed production
  • Poultry farming and processing
  • Construction of modern slaughter houses
  • Establishment of hatcheries with parent
  • stock farms

4.0 Fisheries & Marine Resources

Zanzibar lies at the cross section of rare marine resources and biodiversity with unlimited potential for development of a fishing industry. The entire coastline (about 880 km length)

of both islands has enormous fisheries resources available for investment. The fisheries and marine resources sector includes fishing in artesian water, deep sea water and aquaculture products ranging from seaweed farming, fin fish and shell fish farming. The sector has employed about 63,000 people including women. Demand for fish is increasing as tourist hotels and restaurants seek high species such as sword fish, squid, octopus, crab, marlin, snappers, prawns, tuna and kingfish. There is growing demand for anchovies because of their health benefits.

4.1 Deep Sea Fishing

Zanzibar and Tanzania mainland share the management of deep sea fishing (fisheries located beyond 12 nautical miles). The management of the Tanzania Exclusive Economic Zone (EEZ)

fishing is under the mandate of the Deep Sea Fishing Authority (DSFA) with its office located at Fumba, Zanzibar. Fisheries statistics from licensed vessels show that there are significant

catches in the Tanzania EEZ. There are two fishing seasons: one from February to May and the other from July to September. The common fishing methods applied currently are long lining and purse seining. In 2016 about 96 licenses were issued to fishing vessels from China, France, Seychelles and Spain and about 17,424.70 tons of catches was reported.

4.2 Fisheries Opportunities

  • Aqua/mari culture (fish, shrimps, lobsters, seaweed etc.)
  • Production of seaweed particularly cottonii
  • Value addition in seaweed production such as perfumes, toothpaste, ice-cream, milk-shakes and yoghurt by using seaweed extracts such as carrageen, ager, and alginates gelling substances, stabilizers and emulsifiers
  • Deep sea fishing (snappers, emperors, tuna, sword fish, marlin, kingship, and sailfish)
  • Ice making plants (PPP)
  • Establishment of dry dock facilities (PPP)
  • Fish/marine processing, packaging and canning plant
  • Construction of boat building factory
  • Establishment of maritime institute for trainings on marine long courses (skippers, processors, marine engineers, boat builders, observers, inspectors, fisheries managers) and
  • marine short courses (including firefighting, safety at sea and law, first aid, fish handling and processing)

5.0 Manufacturing

Zanzibar is committed to developing a modern manufacturing industry with backward and forward linkages. The Revolutionary Government of Zanzibar (RGZ) is encouraging light manufacturing through putting in place attractive incentives for industrial projects. Free Economic Zones have been purposely established to attract private investment, with the Business Environment Improvement Programme providing a strong roadmap. Zanzibar passed a Public-Private Partnership (PPP) Act in 2015, creating a framework for attracting private capital to develop, operate and maintain essential infrastructure and services. Furthermore,

RGZ has strengthened Zanzibar Bureau of Standards as a way of quality of products and services.

5.1 Manufacturing Opportunities

5.1.1 Food Agro-processing Industries for Milling, Processing, Packaging and Canning

  • Meat, fish and poultry products
  • Horticulture Food products: vegetables and fruits
  • Natural sweetness: sugar, honey and their derivative products
  • Salts: rock salts and sea salts
  • Dairy products: milk and milk products
  • Beverages: soft drinks and organic juices
  • Natural food additives: spices, seaweed and culinary herbs

5.1.2 Textile, Apparel and Beauty Products Industries

  • Garments;
  • Cosmetics and fragrances

5.1.3 Building and Construction material industries

  • Household electrification material for wiring and lighting
  • Sanitary ware, ironmongery and plumbing accessories
  • Bricks and building blocks
  • Construction aggregates
  • Wall protection paints, wallpapers and roofing materials
  • Wood building columns, panels and decorative products
  • Construction stones, decorative and paving stones
  • Building construction glass and decoration glass/glassware
  • Gypsum building columns & panels, and decorative products

5.1.4 Pharmaceutical and Medical Equipment Supply Industries

  • Malaria and tropical disease drugs
  • Antibiotics drugs
  • Medical consumable supplies: e.g bandages, gauze, plasters and surgical gloves
  • Vaccines
  • Medical surgical equipment and machinery
  • Medical diagnostic equipment and machinery

5.1.5 Consumer Durable Goods Assembling

  • Domestic appliances e.g cookers, catering equipment refrigerators and air conditions
  • Office equipment: e.g computers, printers and e-commerce equipment
  • Consumer electronics goods e.g laptop computers, television receiver sets, audio visual entertainment equipment cellphone hand sets and e-notepads
  • Private automotive vehicle and motorized riders

5.1.6 Capital Good - Component Assembly

  • Fishing Boats and commercial fishing vessels
  • Fixed and mobile telecommunications equipment

6.0 Real Estate Development

Demand for real estate for residential, industrial and commercial purposes is on the rise in Zanzibar. According to a 2017 Africa Report by Knight Frank, Tanzania and Zanzibar make one of the few African countries that have maintained more than 5% GDP growth for the last five years, and is experiencing growth in private consumption and investment. With a burgeoning middle class and improving income levels, there is increasing local demand for real estate. With the island’s strategic location, and with non-national investors allowed to own property in Zanzibar, demand has increased exponentially opening more opportunities in the sector.

6.1 Real Estate Opportunities

Real Estate Opportunities

  • Housing estates and apartments
  • Commercial buildings
  • Shopping malls
  • Mixed use developments
  • Development of mini cities
  • Construction of exhibition and convention centre (PPP)
  • Construction of ZIPA Business Tower through concession Arrangement

7.0 Infrastructure Development

Infrastructure includes roads network, electricity generation and networks, seaports and airports

and other utility structures. Although infrastructure development was the traditional role of the public sector, RGZ has moved to clear the way for private sector participation.

The most notable step was the passing of the Public-Private Partnership (PPP) Act in 2015 creating a framework for attracting private capital to develop, operate and maintain essential infrastructure and services. The Zanzibar Strategy for Growth and Reduction of Poverty (ZSGRP III 2016-2020) asserts that collaboration between the public and private sectors is very important for the much-needed infrastructural development.

7.1 Infrastructure Opportunities

  • Establishment of landing sites
  • Rehabilitation and extension of Pemba Airport
  • Power generation through renewable energy particularly solar and wind
  • Upgrading of electricity transmissions line to 33kv for Pemba and 132kv for Unguja
  • ICT based infrastructure
  • Construction of dry dock facilities
  • Kijangwani Bus Terminal
  • Maisara Sports Complex
  • Construction of markets in Unguja and Pemba
  • Construction of exhibition and convention centers (PPP)
  • Development and Management of Industrial parks

8.0 Services

The provision of services to the public is a priority area for the Government of Zanzibar. To this end, the Government has liberalized the provision of social and other basic services in health, education, tourism and hospitality, insurance, banking, housing and communication sector. For the last five years (since 2013) the service sector has contributed over 44 % of Zanzibar GDP ahead of agriculture and industries sector. There is increasing demand for quality and professionally delivered services in all sectors. The Government has thereby invested in skills development and continues to attract private investments.

8.1 Social services Opportunities

  • Human health activities
  • Residential care activities
  • Establishment of specialized hospitals and diagnostic centres
  • Establishment of modern colleges for hospitality industry
  • Establishment of maritime institutes
  • Establishment of educational institutions

8.2 Financial and Economic Services Opportunities

  • Land, sea and air transport
  • Warehousing and storage facilities
  • Publishing activities
  • Media production
  • Programming and broadcasting activities
  • Telecommunications services
  • Computer programming, consultancy and related activities
  • Establishment of financial services including investment banks
  • Establishment of insurance business
  • Transportation

9.0 Zanzibar Airports Authority

Zanzibar Airports Authority (ZAA) was established under Act No.8 of 2011. The main airports run by ZAA are Abeid Amani Karume International Airport and Pemba Airport.

9.1 Abeid Amani Karume International Airport

Abeid Amani Karume International Airport (AAKIA) is located at the South East of Zanzibar City with 3,022 m long and 45 m wide runaway. Taxiways and apron cover about 21,000 sqm with strengths of PCN 64. It comprises the terminal building to cater for local and international

passengers. Abeid Amani Karume International Airport is a tourist hub in East Africa. Many tourists coming to the region converge here before proceeding to other destinations such as Kilimanjaro, Mozambique, Mombasa and Nairobi. Zanzibar Island has one of Africa’s best white sand beaches, sea shores and caves and coral reefs. Zanzibar is a major tourist destination and the tourism industry is the number one earner of foreign exchange after the reign of cloves in the world market in early 1980s.

9.1.1 New Passenger Terminal

Due to the rapid economic growth of Zanzibar, especially in the sector of tourism which has attracted wide body aircrafts in general aviation, a new passenger terminal with capacity to accommodate over 2 million passengers per year is under construction. This will allow the airport to serve bigger aircraft like Airbus 330, Boeing 777, Boeing 787 (dream liner) and Boeing

747. The new terminal building will be equipped with modern facilities such as CCTV, baggage scanner and aero-bridges for bigger aircraft. Also with the construction of a new vehicle parking area, the airport will be able to accommodate 1,000 vehicles at a time.

9.2 Pemba Airport

Pemba Airport was opened in August 1953. It is located South East of Chake Chake town with a capacity to handle all aircrafts. Pemba Airport presently provides regular services to Unguja, Tanzania mainland and regional destinations. It has a high potential for tourism and trade with the best snorkeling and diving centers in the region and a recently opened under sea hotel.

9.3 Business opportunities at Zanzibar Airports Authority

  • Advertisement
  • Lease properties
  • Land lease

A wide variety of cross-media and digital marketing options in a high-grade setting, include digital advertising media, highly impressive large-scale billboards, unrivalled exhibitions,

interaction concepts and sponsoring formats are available. There are more than 100 indoor and outdoor advertising media in the Terminal II building. More than 250 indoor and outdoor advertising media are expected in Terminal III which is under construction. This will include approach roads and indoor routes to be used by more than 2 million passengers who will use the new terminal buildings.

ZAA, through its current terminal building at AAKIA and Pemba Airport and the new terminal (Terminal III which is expected to have 25,000 square meters), offers its space for lease to companies, which have an interest in pursuing their commercial goals in the unique environment of the Airport. Duty Free, VIP and business class lounge, shops, services and restaurants complement services provided by air carriers and their handling partners and become an integral part of airport terminals.

Zanzibar Airports Authority has approximately 5,751,230 square meters of land at AAKIA and 928,268 square meters at Pemba Airport. The land area at the airports provides opportunities to the interested clients to deal in businesses such as construction of aircraft hangars, aviation schools, fuel deports, cargo terminals and storage facilities.