Tanzania's economy relies heavily on agriculture, which accounts for nearly half of the GDP and employs 80% of the workforce.
Tourism is growing in importance and ranks as the second highest foreign exchange earner after agriculture.
Mineral production (gold, diamonds, tanzanite) has grown significantly in the last decade.
It represents Tanzania's biggest source of economic growth, provides over 3% of the GDP and accounts for half of Tanzania's exports.
Accounting for less than 10% of GDP, Tanzania's industrial sector is one of the smallest in Africa.
Despite enthusiastic privatisation during the 1990s and annual GDP growth of between 5 and 7%, the Tanzanian economy remains weak.
Mkapa's Government (1996-2005) saw through a vigorous programme of economic reform, in line with IMF guidelines.
President Kikwete has pledged to continue these policies.
Tough measures have included tight control of public spending, privatisation of parastatals, reform of the Investment Code, the taxation system and land ownership, steps to improve revenue collection, expenditure control and civil service retrenchment.
Corruption is still endemic; Kikwete has said that addressing this will be one of his major priorities.