More protests in Dar es Salaam after chaotic Tanzanian election

Tanzania is experiencing widespread political unrest following a general election, with police deploying tear gas and gunshots against protesters in Dar es Salaam and other major cities. The demonstrations, fueled by the exclusion of prominent opposition candidates and accusations of government repression, have resulted in reported fatalities, curfews, and disruptions including international flight cancellations. This escalating instability poses a significant challenge to President Samia Suluhu Hassan's administration and introduces heightened political risk for the country's economic environment.

Analysis

Tanzania is experiencing significant political instability following a general election marred by widespread protests and alleged government repression. Police have deployed tear gas and gunshots against demonstrators in major cities like Dar es Salaam, leading to reported fatalities and an overnight curfew. This unrest stems from the disqualification of key opposition candidates and accusations of increasing authoritarianism under President Samia Suluhu Hassan.

The escalating situation has caused substantial operational disruptions, including intermittent internet access and the cancellation of international flights to and from Dar es Salaam, Arusha, and Kilimanjaro airports. The U.S. Embassy has advised citizens to shelter in place, highlighting significant travel risks. These disruptions directly impact business operations, supply chains, and foreign investment accessibility within the country.

The current crisis presents a critical test for President Hassan, whose administration is now accused of reversing earlier reforms aimed at easing repression. The disqualification of major opposition parties, CHADEMA and ACT-Wazalendo, suggests a tightening political landscape. This heightened political risk, coupled with the volatile social environment, casts a negative outlook on Tanzania's near-term stability and governance.

Key Decisions for Investors

• Investors should immediately reassess their exposure to Tanzanian assets given the extremely negative sentiment and high political risk, closely monitoring the evolving security situation and government response
• Evaluate potential disruptions to supply chains and operational continuity for any businesses with significant presence or dependencies in the region
• Consider hedging strategies or reducing positions in companies with direct or indirect exposure to Tanzania's volatile political and economic environment