DODOMA, Tanzania – Tanzania has moved to assure Kenya that its recently announced restrictions on foreign-owned businesses will not affect Kenyan traders, easing fears of a diplomatic rift between the two East African Community (EAC) partners.
The clarification was issued on Friday, October 3, by Tanzania’s Ministry of Industry and Trade following reports that the new policy aimed at limiting foreign participation in small-scale businesses could impact thousands of Kenyans operating across the border.
According to the ministry, the directive primarily targets foreign nationals engaging in micro and small enterprises reserved for Tanzanian citizens under local law.
“Kenyans and other EAC citizens remain protected under the Common Market Protocol, which guarantees their right to establishment and participation in cross-border trade,” the statement read.
The assurance comes amid growing concerns after Dar es Salaam unveiled a list of business activities, including retail shops, salons, food vending, and small transport operations, that foreigners would no longer be allowed to run.
Tanzanian officials stressed that the restrictions were meant to protect vulnerable local enterprises from being crowded out by external competitors.
In Kenya, the announcement had triggered alarm among business associations. “Our traders were anxious that they would be pushed out of Tanzania overnight.
This clarification brings relief, but we must remain vigilant to ensure full compliance with EAC rules,” said James Mwaura, a cross-border trade representative.
Analysts say the move underscores the delicate balance Tanzania faces as it seeks to protect its domestic market while remaining committed to regional integration.
“It’s a classic case of economic nationalism versus regional obligations. The government wants to shield local SMEs, but it cannot afford to antagonize its neighbors,” noted economist Dr. Faith Mbogo.
Kenya and Tanzania are among the largest trading partners within the EAC, with bilateral trade valued at over Sh100 billion in 2024.
Any disruption in business relations would have significant repercussions, particularly in border towns like Namanga, Isebania, and Taveta, where small-scale traders drive local economies.
The Tanzanian government reiterated its commitment to regional cooperation, saying it would continue to harmonize policies in line with the EAC Treaty.
For now, Kenyan traders can breathe easier, though the debate over protecting local businesses while fostering regional integration remains unresolved.
