page_title: Zanzibar
section_title: Economy
hierarchical_section_title: Zanzibar / Economy
caption_attribution_description: The Rock Restaurant, Zanzibar
context_page_description: Zanzibar is a semi-autonomous region of Tanzania. It is composed of the Zanzibar Archipelago in the Indian Ocean, 25–50 kilometres off the coast of the mainland, and consists of many small islands and two large ones: Unguja and Pemba Island. The capital is Zanzibar City, located on the island of Unguja. Its historic centre is Stone Town, which is a World Heritage Site.
  Zanzibar's main industries are spices, raffia, and tourism. In particular, the islands produce cloves, nutmeg, cinnamon, and black pepper. For this reason, the Zanzibar Archipelago, together with Tanzania's Mafia Island, are sometimes referred to locally as the "Spice Islands".
  Zanzibar is the home of the endemic Zanzibar red colobus, the Zanzibar servaline genet, and the extinct or rare Zanzibar leopard.
context_section_description: Ancient pottery implies trade routes with Zanzibar as far back as the time of the ancient Assyrians. Traders from the Arabian Peninsula, the Persian Gulf region of modern-day Iran (especially Shiraz), and west India probably visited Zanzibar as early as the 1st century. They used the monsoon winds to sail across the Indian Ocean to land at the sheltered harbor located on the site of present-day Zanzibar City.
  The clove, originating from the Moluccan Islands (today in Indonesia), was introduced in Zanzibar by the Omani sultans in the first half of the 19th century. Zanzibar, mainly Pemba Island, was once the world's leading clove producer, but annual clove sales have plummeted by 80 percent since the 1970s. Zanzibar's clove industry has been crippled by a fast-moving global market, international competition, and a hangover from Tanzania's failed experiment with socialism in the 1960s and 1970s, when the government controlled clove prices and exports. Zanzibar now ranks a distant third with Indonesia supplying 75 percent of the world's cloves compared to Zanzibar's 7 percent.
  Zanzibar exports spices, seaweed and fine raffia. Beside the Zanzibar State Trading Cooperation, Zanj Spice Limited, also known as 1001 Organic, is the biggest organic spice exporter in Zanzibar. Zanzibar also has a large fishing and dugout canoe production. Tourism is a major foreign currency earner.
  The Government of Zanzibar legalized foreign exchange bureaux on the islands before mainland Tanzania moved to do so. The effect was to increase the availability of consumer commodities. The government has also established a free port area, which provides the following benefits: contribution to economic diversification by providing a window for free trade as well as stimulating the establishment of support services; administration of a regime that imports, exports, and warehouses general merchandise; adequate storage facilities and other infrastructure to cater for effective operation of trade; and creation of an efficient management system for effective re-exportation of goods.
  The island's manufacturing sector is limited mainly to import substitution industries, such as cigarettes, shoes, and processed agricultural products. In 1992, the government designated two export-producing zones and encouraged the development of offshore financial services. Zanzibar still imports much of its staple requirements, petroleum products, and manufactured articles.
  There is also a possibility of oil availability in Zanzibar on the island of Pemba, and efforts have been made by the Tanzanian Government and Zanzibar revolutionary Government to exploit what could be one of the most significant discoveries in recent memory. Oil would help boost the economy of Zanzibar, but there have been disagreements about dividends between the Tanzanian mainland and Zanzibar, the latter claiming the oil should be excluded in Union matters.
  In 2007, a Norwegian consultancy firm went to Zanzibar to determine how the region could develop its oil potential. The firm recommended that Zanzibar follow economist Hernando de Soto Polar's ideas about the formalization of property rights for persons living on ancestral land for which they probably do not have a legal deed.
caption: Tourism is one of the main sectors of the economy
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