Transport logistics companies are one of the paramount movers of capital in any economy. Their role in transcending the time-space constraints to facilitate the flow of goods makes them a vital hub for promoting forward and backward linkages, spurring economic growth and facilitating the overall investment environment in an economy. As conduits of the Global Value Chains (GVCs) the ‘value’ added by logistic companies lies in enabling the basic flow of global connectivity; any delay of movement results in an overall price hike of commodities and service provision. At the same time, logistic companies in themselves are also important sites of capital accumulation. In Tanzania the proliferation of private logistic companies emerged as a substitute to transport parastatals. The end of state socialism and gradual liberalisation of the economy provided a suitable platform for emerging private capital to invest in the transport business. In addition, many logistic companies also emerged as part of conglomerates’ subsidiaries. The operationalisation of these companies has been contingent on ‘informal’ and ‘irregular’ activities, which fall outside the scope of what is usually described as the formal economy. This study seeks to analyse the changing dynamics which underpin the rapid growth of private transport logistic companies in Tanzania. Using the conceptual framework of ‘enterprise-led informalisation’ I explore the ways in which formal transport companies operate as a hub of formal and informal activities, whilst being part of a global GVC.
Focusing on commercial trucking companies, I highlight the patterns of capital accumulation followed by these companies since the initiation of free-market reforms. I have isolated two ways of capital accumulation to highlight how the private transport sector engages with and simultaneously constitutes the informal economy in Tanzania. The first of these patterns is the role of large trucking companies to act as informal credit lenders to other transport businesses, outside the realm of formal financial markets. A second tendency is the scope for illegal accumulation through corrupt practices, which has been difficult to regulate by the state. Finally, I highlight how the relationship between private capital and the informal economy is also reflected in the nature of transport labour markets. Transport workers are employed by companies as permanent (formal) employees as well as wage (informal) labourers. This fragmentation enables transport companies to differentiate between skilled and unskilled labour, saving costs by expanding and shrinking the labour force without restraint and avoiding formal labour regulations.