Nairobi — Kenyan businesses are facing fresh barriers in Tanzania following the introduction of a new directive that restricts foreign firms from operating in select sectors of the economy.

Tanzania's Government Notice No. 487A prohibits non-citizens, including Kenyan nationals and companies, from engaging in a range of business activities. These include retail and wholesale trade (excluding supermarkets and specialized product outlets), mobile money transfer services, tour guiding, clearing and forwarding, brokerage, agency work, and gambling.

The order is expected to impact a wide range of Kenyan enterprises and individuals operating in Tanzania, particularly those in the tourism, logistics, and communication sectors. Tour companies offering safaris in the Serengeti and Mount Kilimanjaro, as well as PR agencies and other service-based firms, are among those likely to be affected.

The move comes amid cooling trade ties between the two neighbours. Kenya's exports to Tanzania declined to Sh51.84 billion in 2024, down from Sh55.96 billion during a similar period last year.

Under the new rules, foreigners found operating in the prohibited sectors risk fines of at least TSh10 million (approx. Sh500,000) or up to six months in prison. Tanzanians found aiding foreigners in violation of the law could face up to three months in jail or similar penalties.

The order is seen as part of Tanzania's broader strategy to localize economic opportunities, but it has sparked fresh concerns over protectionism and its impact on regional integration within the East African Community.