Only foreign investors meeting a minimum investment threshold (higher than required from domestic investors) can be entitled to credit from domestic sources.
New Investment Act adopted on December 2022 reduced the minimum investment capital for locally owned businesses from $100,000 to $50,000.
"Section 2. Application [....]
(2) A business classified for the purposes of this section that can obtain the benefits and immunity provided under this Act is that which-
(a) if it is wholly owned by a foreign investor or if it is a joint venture, the minimum investment capital is not less than Tanzanian shillings equal to five hundred thousand United States dollars (US$ 500,000);
(b) if it is owned by a Tanzanian, the minimum investment capital is not less than Tanzanian shillings equal to fifty thousand United States dollars (US$ 50,000).
[...]
Section 31. Access to loans for foreign investors from local sources
(1) In accordance with clause 2, a foreign investor may, in relation to the business he operates, obtain loans from local banks and financial institutions up to the limit set by the Central Bank of Tanzania in consultation with the Center based on the amount of capital foreign invested in a commercial institution.
(2) A foreign investor who obtains a loan in accordance with subsection (1) shall ensure that the proceeds of the loan are used for the purpose of carrying out the activities specified in his loan application.
(3) The lending bank may, for the purposes of this section, appoint an officer or its agent to verify the proper use of the loan granted under subsection (1)." (Tanzania Investment Act, 2022, Sections 2 and 31 [google translation])
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Previously
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"Section 2. Application […]
2) The businesses specified for the purpose of this section which may enjoy the benefits and protection provided under this Act, are those which—
a. if wholly owned by a foreign investor or if a joint venture, the minimum investment capital is not less than Tanzanian Shillings equivalent of US dollars three hundred thousand (US$ 300,000); or
b. if locally owned, the minimum investment capital is not less than Tanzanian shillings equivalent of US dollars one hundred thousand (US$100,000).
[...]
Section 3. Interpretation
In this Act, unless the context requires otherwise—[...]
"foreign investor" in the case of a natural person means a person who is not a citizen of Tanzania, and the case of a company, a company incorporated under the laws of any country other than Tanzania in which more than fifty percent of the shares are held by a person who is not a citizen of Tanzania, and in the case of partnerships, means a partnership in which the partnership controlling interest is owned by a person who is not a citizen of Tanzania;[...]
"local investor" means a natural person who is a citizen of Tanzania; a Company incorporated under the laws of Tanzania in which the majority of the shares are held by a person who is a citizen of Tanzania; or a partnership in which the partnership controlling interest is owned by a person who is a citizen of Tanzania; "member" means a member of the Board of the Centre; "Minister" means the Minister responsible for investments;
[...]
Section 25. Obtaining credit from domestic sources by foreign investors
1) Subject to section 2, a foreign investor may, in relation to the business enterprise which he operates, obtain credit from domestic bank and financial institutions up to the limit established by the Bank of Tanzania in consultation with the Centre having regard to the amount of foreign capital invested in the business enterprise.
2) A foreign investor who obtains credit in accordance with subsection (1) shall ensure that the proceeds of that credit are used solely for the purpose of carrying out the activities specified in his loan application.
3) The bank granting the loan may, for the purposes of this section, appoint its officer or agent to verify the due application of the credit obtained under subsection (1).[...]" (Tanzania Investment Act, 1997)
Tanzania Investment Act, 2022, Sections 2 and 31 [google translation]
Tanzania Investment Act, 1997
[<a href="https://fbattorneys.co.tz/wp-content/uploads/2022/12/New_Investment_Act_2022.pdf">Act</a>],[<a href="https://procedures.tic.go.tz/media/INVESTMENT%20ACT.pdf">Act</a>]