East Africa gains as Tanzania, Rwanda deepen economic ties

Trade links between Tanzania and Rwanda are entering a new phase as both countries move to strengthen cooperation in commerce, infrastructure and energy, underscoring a wider push for economic integration across East Africa. 

The renewed partnership follows talks in Dar es Salaam between Samia Suluhu Hassan and Paul Kagame, where both leaders agreed to broaden cooperation in trade, investment, transport, energy, security and immigration. 

Their discussions come as East African economies work to lower trade costs, improve transport networks and strengthen regional supply chains under the East African Community common market and the African Continental Free Trade Area. 

For businesses, the talks carry practical weight. Easier movement of goods across borders, better transport links and more reliable electricity supply could help lower operating costs, support new investment and make trade within the region more efficient.

Focus on trade and transport 

A key part of the agreement is a shared effort to remove non-tariff barriers that have long slowed trade between neighboring countries.

Cutting customs delays, easing border processes and improving regulations could make it easier for companies to move goods and expand into new markets. 

Transport infrastructure also remains high on the agenda.

Both leaders highlighted the planned Isaka-Kigali railway, a project expected to improve cargo movement between the two countries and reduce the cost of moving goods for Rwanda, which relies heavily on Tanzanian trade routes.

Energy and investment ties grow 

Energy cooperation is also becoming a larger part of the relationship.

The Rusumo Falls Hydroelectric Project, a joint project involving Tanzania, Rwanda and Burundi, alongside electricity agreements between Tanzania Electric Supply Company and Rwanda Energy Group, is expected to help meet rising power demand from homes, factories and businesses. 

The economic relationship is already substantial.

Tanzania handles about 70 percent of Rwanda-bound freight through the ports of Dar es Salaam and Tanga.

Bilateral trade reached 644 billion Tanzanian shillings ($246.76 million) in 2025, while 42 Rwandan-backed investment projects worth $325.5 million have created more than 2,200 jobs in Tanzania, showing how closer ties are translating into real economic activity.