Tanzania bans foreigners from engaging in 15 small-business activities

Samia Suluhu Hassan - president of Tanzania (image source)

Tanzania has formally prohibited non-citizens from owning or operating 15 categories of small and medium business, issuing a legal order on July 28, 2025, that tightens long-standing “reserved sectors” for locals. The rule—Government Notice No. 487A of 2025, titled The Business Licensing (Prohibition of Business Activities for Non-Citizens) Order, 2025—was gazetted by the Minister for Industry and Trade and is now in force.

According to legal and policy briefs, the barred activities include retail trade, mobile-money agency services, operation of salons and barbershops, curio and small craft shops, local tour guiding, on-farm crop buying, small-scale mining, selected media activities, and other “local commerce” lines traditionally contested between citizen micro-entrepreneurs and foreign entrants. Existing non-citizen operators are expected to wind down or restructure, with penalties for non-compliance. Authorities argue the order shields local livelihoods from displacement and aligns licensing with the Business Licensing Act’s 2023 revisions.

East Africa has long wrestled with balancing openness and protection for micro-enterprise: Kenya, Uganda, and Tanzania have all flirted with reserved lists or local-content rules. What’s new is the precision and breadth of Tanzania’s prohibited list—and its immediate enforce-ability via licensing and inspections. Law firms advise foreign investors to audit their portfolios for exposure and consider partnerships that shift them upstream (manufacturing, wholesale, technology platforms) or into sectors still open with permits.

Critics worry about unintended consequences. Banning foreigners from, say, mobile-money agent outlets may protect citizen vendors—but could also reduce cash-in/cash-out points if transition is messy, hurting rural users. Tourism operators warn that restricting certain guiding or curio activities could degrade visitor experience if training doesn’t keep pace. Cross-border tensions are also possible: regional traders displaced from Tanzanian towns may push back through EAC channels, citing common-market principles. Government’s counter: the order targets business scale, not workers; foreign investment is encouraged in capital-intensive sectors, while micro-retail remains for locals.

Analysts also say there is more to be done to make the legislation effective. For example, they say regulators must publish clear transition timelines and grandfathering provisions, provide appeal mechanisms for borderline cases, and coordinate with immigration so work permits reflect the new boundaries. Done well, the change could formalise space for Tanzanian SMEs; done poorly, it risks harassment and rent-seeking at checkpoint level.