What President Magufuli’s death means for Tanzania’s economic policy

Tanzanian President John Magufuli, known as 'The Bulldozer', passed away at the age of 61, leaving behind a mixed legacy. While he started his tenure with a reputation for getting things done and fighting corruption, his later years were marred by human rights abuses and controversial decisions regarding the handling of COVID-19. However, his economic legacy paints a different picture. Magufuli made significant strides to reform Tanzanian institutions and combat corruption. His anti-corruption narrative set a positive tone for economic growth in the country. In 2016, he targeted the mining sector with contentious tax requirements, leading to a decline in gold exports and investment. Despite the initial setbacks, Magufuli later mended relations with Barrick Gold, resulting in the resumption of mining activities and a boost to the sector. Additionally, his focus on infrastructure development, including securing the East African crude oil pipeline and negotiating deals with China, showcased his commitment to economic growth. Notably, Tanzania remained one of the fastest-growing economies in East Africa under his leadership. As Tanzania prepares for a new leader, the investment community is assessing the country's risk premium. Analysts like Menzi Ndhlovu believe that Tanzania's policy shift towards COVID-19 and recent liberal-leaning statements signal a more favorable environment for investors. While a change in leadership may not significantly alter the risk profile, concerns remain about the pace of policy adjustments and potential political divisions within the ruling party, which could impact economic prospects. Ndhlovu warns that a slow response to policy changes and internal party dynamics could hamper Tanzania's transition and deter investors, leading to negative repercussions on the country's economy.