Rwanda and Tanzania have decided to accelerate their economic and infrastructure cooperation. With $247 million in trade in 2025 and 42 Rwandan investment projects on Tanzanian soil, the two neighbours are building one of East Africa's most dynamic commercial corridors.
$247 million in trade in 2025
Bilateral trade reached $247 million in 2025 (644 billion Tanzanian shillings). The 42 Rwandan investment projects in Tanzania, worth a total of $325.5 million, have already created 2,225 jobs for Tanzanian nationals.
This commercial relationship is structurally asymmetric but mutually beneficial: around 70% of Rwanda's freight transits through Tanzanian ports at Dar es Salaam and Tanga, making Tanzania an indispensable strategic partner for a landlocked country like Rwanda.
The Isaka-Kigali railway, the key infrastructure
The flagship project of the partnership is the Isaka-Kigali railway line, which will connect Tanzania's Isaka rail hub to the Rwandan capital. This project would significantly reduce the cost and time of goods transport between the two countries, partly replacing road transport.
The Rusumo Falls hydroelectric dam — a trilateral project involving Tanzania, Rwanda and Burundi — is the other major initiative in this cooperation, with electricity supply contracts already signed between national operators TANESCO and REG.
A reinforced institutional framework
The two countries agreed to strengthen collaboration across six axes: trade and investment, transport and infrastructure, energy, defence and security, immigration, and regional and international coordination. The framework specifically targets the elimination of non-tariff trade barriers — a persistent obstacle in the region despite frameworks offered by the East African Community and the AfCFTA.
Why it matters
The Rwanda-Tanzania corridor illustrates how two East African economies — one landlocked, one coastal — can create lasting synergies. For Indian Ocean businesses seeking to enter the East African market, this corridor represents a gateway to over 100 million consumers.
Sources: Agence Ecofin