Clue: Challenges South Africa with a hit outside capital (3,2,6)
Answer: DAR ES SALAAM
Explanation: Definition: capital
**DARES** ("challenges") + **S**(outh) **A**(frica) *with* **SLAM** ("hit") *outside* **A**, so **DARES-SA-L(A)AM** 
*Going to cry foul here, as Dar Es Salaam has not been a capital since 1996 (originally intended to happen in 1974), when Dodoma was completed, so "old capital" or "ex-capital" may have been more accurate.