United Republic of Tanzania
Year: 2025
Type: article
Abstract: This Selected Issues paper explores empirically the extent to which weaknesses in the business environment might have contributed to the slowdown in firm-level productivity in Tanzania. Using the World Bank’s Enterprise Surveys data, this paper sheds light on the relationship between firm-level total factor productivity (TFP) and the business environment in Tanzania. It finds statistically significant evidence that cumbersome tax administration, limited access to finance, and limited access to transport are associated with lower firm TFP in the manufacturing sector. While regression coefficients are not statistically significant, negative associations between TFP and the regulatory burden, as well as power outage, are also evident in non-parametric relationships. On the other hand, there is no clear evidence for the relationship between incidence of corruption and TFP. These results underscore the importance of stepping up structural reforms to improve the efficiency of tax administration, ease the regulatory burden, and improve access to finance and reliable infrastructure. In particular, these reform areas should be given priority in the context of the Vision 2050 and Blueprint for Regulatory Reforms II strategies.
Source: IMF Staff Country Reports
Author: International Monetary Fund. African Dept.
Language: English
Topic: Global trade and economics
Domain: Social Sciences
Open Access status: diamond
OpenAlex ID: W4411978645