Tanzania Outpaces Kenya But Trails Rwanda. Comparing East Africa's Economic Performance

DAR ES SALAAM — Tanzania grew 5.9 percent in 2025 according to National Bureau of Statistics data cited in the National Development Plan 2026/27, placing it third among the six core EAC member economies ranked by growth rate. Rwanda led at 7.0 percent, Uganda at 6.7 percent, then Tanzania at 5.9 percent, DRC at 5.7 percent, Kenya at 4.9 percent, and Burundi at 3.9 percent. Why Rwanda is growing faster Rwanda's 7.0 percent growth, sustained across multiple years and confirmed by National Institute of Statistics Rwanda data, reflects the combination of high governance quality, concentrated tourism revenue from gorilla trekking and MICE events, fintech and financial services sector development through the KIFC, and construction and services activity associated with the Kigali urban development programme. Rwanda's growth is not resource-driven: it has no significant mineral exports, no coastal port, and a population of only 14 million that limits its domestic market. It is governance and investment environment-driven, which makes it both more consistent across years and more sensitive to political stability than Tanzania's more diversified growth model. Rwanda's 2026 growth projection from IMF data is 7.2 percent, modestly above 2025. Tanzania's 6.3 percent target for 2026 would narrow the gap but not eliminate it. Why Uganda is growing faster Uganda's 6.7 percent in 2025 reflects in part the EACOP construction activity whose 82.6 percent completion by April 2026 has been generating logistics, construction, professional services, and supply chain activity across Uganda's oil-producing western regions. Once EACOP is complete and oil production begins, Uganda's growth profile will shift from construction-driven to resource-driven, with the volatility characteristics that commodity cycles introduce. The growth rate is partly a construction boom borrowed from the future in which oil revenues must service the infrastructure debt. Why Kenya is growing more slowly Kenya's 4.9 percent growth in 2025, below Tanzania for the first time in the five-year series, reflects the fiscal consolidation that followed the 2024 debt crisis, the social disruption from the June 2024 protests that disrupted economic activity, and the tourism and investment climate uncertainty that the political environment created. Kenya's longer-term growth potential remains strong, but 2024 and 2025 were disrupted years whose GDP growth understates the underlying structural capacity. The comparative advantages Tanzania holds Tanzania's structural advantages over all EAC peers include its coastal position and Central Corridor logistics function, which generate transit revenue from every tonne of cargo the landlocked neighbours route through Dar es Salaam. Its mineral resource diversity across gold, graphite, nickel, rare earth, coal, uranium, and natural gas is unmatched in the region. Its domestic market at 70 million people growing to 118 million by 2050 provides demand-side investment justification that Rwanda's 14 million and Uganda's 50 million cannot match for most manufacturing investments. And its food surplus position at 130 percent self-sufficiency insulates it from the food price inflation and import dependence that creates macroeconomic vulnerability in Kenya, Rwanda, and especially Burundi.