The government is seeking to use its TZS42.6 trillion public procurement market to expand business opportunities for local companies and create jobs for millions of Tanzanians, with young people, women and other disadvantaged groups being targeted for a greater share of government contracts.
The strategy rests on the National e-Procurement System of Tanzania (NeST), which has processed 430,643 tenders since its introduction in September 2023, according to the Public Procurement Regulatory Authority (PPRA).
However, the authority says the challenge now extends beyond digitising procurement procedures to ensuring that ordinary Tanzanians, particularly those without the financial capacity to establish companies, can compete for and benefit from public contracts.
PPRA Director General Dennis Simba said the government had reserved 30 per cent of public procurement budgets for special groups comprising young people, women, older people and persons with disabilities.
"The objective is to ensure that every Tanzanian benefits from and contributes to economic growth, regardless of their economic position," he said when addressing media editors in Dar es Salaam on Thursday.
The initiative has so far attracted 33,659 registered groups, which have secured tenders worth TZS82.34 billion through NeST.
Youth groups account for TZS44.74 billion of the contracts, followed by women's groups with TZS33.15 billion. Older people's groups have secured TZS3.78 billion, while groups representing persons with disabilities have obtained TZS680.21 million.
The figures demonstrate growing participation by groups that have traditionally faced barriers to accessing government business. However, their share of the overall procurement market remains relatively small, highlighting the need to examine whether the opportunities created by the system are translating into meaningful economic participation.
PPRA wants to increase the number of registered groups to 300,000, with the authority projecting that their participation could generate up to three million jobs through wider economic activity.
Simba said individuals who lacked the resources to establish companies could form groups of at least three members, register with their local authorities and subsequently enrol in NeST to access available tenders.
A group can secure a contract worth up to TZS500 million under the programme.
"We want people to understand that government procurement is not an opportunity reserved for large companies. Even ordinary citizens, including those at village level, can participate," he said.
The scale of the opportunity is significant because public procurement accounts for approximately 70 per cent of the government's budget, according to PPRA.
This makes the sector one of the largest channels through which public resources enter the private economy. How contracts are advertised, awarded and implemented therefore has direct implications for business growth, employment and the delivery of public services.
The government's challenge is to ensure that the enormous spending power translates into productive domestic investment rather than merely expanding the volume of contracts awarded.
Under the Public Procurement Act of 2023, tenders worth up to TZS50 billion are reserved for local companies. Domestic bidders also receive preference of up to 10 per cent in internationally competitive tenders, while locally manufactured products enjoy preference of up to 15 per cent over imported alternatives.
Simba said NeST had made it easier to enforce these provisions by restricting foreign bidders from applying for tenders reserved for local firms.
The digital system is also intended to address longstanding concerns about transparency, administrative costs and unequal access to procurement information.
Since its introduction, compliance with procurement regulations has improved from 65 per cent in the 2023/24 financial year to 76 per cent in 2024/25 and 79 per cent in 2025/26.
The system has also eliminated the need for suppliers to physically travel to procuring institutions to submit tender documents, reducing the time and costs associated with bidding.
More than 288.57 million pages of procurement documents have not been printed because of the digital platform, representing estimated savings of TZS27.64 billion.
"Today, a supplier can apply for a government tender from wherever they are. They no longer need to travel to the procuring institution to submit documents," Simba said.
NeST has six operational modules covering user registration, tendering, contract payments, contract management, electronic catalogues and reverse auctions.
The platform is connected to more than 30 other systems, including banking and payment systems, professional registration bodies and licensing databases. PPRA says the integration has helped reduce the possibility of forged documents and simplified the verification of bidders.
The authority has also introduced a Bank Security Portal, which became operational on October 1, 2026. More than 36 banks have been connected to the portal, allowing them to issue and verify tender securities through NeST without directly integrating their systems with the platform.
NMB Bank is already directly connected to the system, while CRDB Bank and Tanzania Commercial Bank are in the final stages of integration.
Despite these developments, the growing volume of procurement transactions makes accountability in contract implementation equally important.
Improved compliance and digital processing do not automatically guarantee that completed projects meet required standards, are delivered on time or provide value for money. The effectiveness of the system will ultimately depend on the quality of goods, services and infrastructure delivered through the contracts.
PPRA's figures also show that the digital transformation has extended beyond administrative efficiency. A recent study indicated that the system helped reduce carbon emissions by 64,768 tonnes of carbon dioxide equivalent between the 2023/24 and 2024/25 financial years.
The authority is also conducting research to enable NeST to participate in carbon trading, which Simba said could generate more than TZS20 billion annually.
To widen access further, PPRA has introduced the NeST Tenderer mobile application, available through Google Play Store and Apple's App Store. Users can register, apply for tenders and follow up on payments using smartphones.
Between July 2023 and September 2026, PPRA trained more than 200,000 procurement officers, over 20,000 suppliers and more than 500,000 university students. Training also reached 393 Members of Parliament, 929 editors and journalists and 11,891 representatives of special groups.
The authority also trained 9,637 participants from grassroots government institutions, including schools, health facilities, wards and villages.
Simba said expanding public awareness was necessary to ensure that procurement opportunities were not concentrated among established businesses and individuals familiar with government procedures.