Executive Summary
Critical Findings on Tanzania's Fiscal Trajectory
This comprehensive report analyzes Tanzania's national debt crisis from 2020 to 2025, integrating multiple data sources to provide a complete picture of the country's fiscal trajectory. The analysis reveals a troubling trend: Tanzania's national debt has grown 65.8% over the period while GDP expanded by only 38.0%, resulting in a debt-to-GDP ratio increase from 41.27% to 49.59%.
🚨 Critical Alert
This represents debt accumulation at nearly 1.74 times the rate of economic growth, raising serious sustainability concerns despite official reassurances. Tanzania is approaching the IMF's 55% danger threshold, with just 5.4 percentage points of buffer remaining.
Key Finding
Over the five-year period, national debt increased by USD 17.21 billion while GDP grew by USD 24.07 billion. The debt-to-GDP ratio climbed 8.32 percentage points, from 41.27% to 49.59%. From 2021-2024, debt consistently grew faster than GDP every single year, with the differential ranging from 3.8 to 7.0 percentage points.
Debt Growth vs GDP Growth: A Widening Gap (2020-2025)
⚠️ Sustainability Threshold Alert
At 49.59%, Tanzania is just 5.4 percentage points below the IMF's 55% sustainability threshold for developing economies. The country is also approaching the critical 18% debt service-to-revenue threshold, currently at 14.5%.
Section 1
Macroeconomic Overview (2020-2025)
This section examines the fundamental economic indicators that frame Tanzania's debt sustainability challenge, including GDP growth, debt accumulation patterns, and the critical debt-to-GDP ratio trajectory.
Table 1: GDP, National Debt, and Debt-to-GDP Ratio (2020-2025)
| Year | GDP (USD Billion) | National Debt (USD Billion) | Debt-to-GDP Ratio (%) | Debt Change (YoY) | GDP Change (YoY) |
|---|---|---|---|---|---|
| 2020 | $63.37 | $26.15 | 41.27% | — | — |
| 2021 | $67.84 | $29.85 | 44.00% | +14.2% | +7.1% |
| 2022 | $72.95 | $33.92 | 46.50% | +13.6% | +7.5% |
| 2023 | $76.66 | $37.29 | 48.64% | +9.9% | +5.1% |
| 2024 | $80.14 | $39.61 | 49.43% | +6.2% | +4.5% |
| 2025 | $87.44 | $43.36 | 49.59% | +8.5% | +9.1% |
| Total Change | +$24.07B (+38.0%) | +$17.21B (+65.8%) | +8.32 pp | — | — |
Sources: Statista (2020-2023), SECO Economic Report (2023-2024), IMF (2025 projections)
Debt-to-GDP Ratio Trajectory: Approaching IMF Threshold
Critical Observation
From 2021-2024, debt consistently grew faster than GDP every single year, with the differential ranging from 3.8 to 7.0 percentage points. Only in 2025 did GDP growth (9.1%) marginally exceed debt growth (8.5%), potentially signaling a turning point—but this remains a projection subject to economic conditions.
Table 2: Annual Growth Rates and Comparative Analysis (2020-2025)
| Year | GDP Growth (%) | Debt Growth (%) | Growth Differential | Sustainability Trend |
|---|---|---|---|---|
| 2020-2021 | +7.1% | +14.2% | -7.1 pp | ⚠️ Deteriorating |
| 2021-2022 | +7.5% | +13.6% | -6.1 pp | ⚠️ Deteriorating |
| 2022-2023 | +5.1% | +9.9% | -4.8 pp | ⚠️ Deteriorating |
| 2023-2024 | +4.5% | +6.2% | -1.7 pp | ⚠️ Deteriorating |
| 2024-2025 | +9.1% | +8.5% | +0.6 pp | ✓ Improving |
Annual Growth Rate Differential: Debt vs GDP
Table 3: Reconciliation of Debt Figures (USD Billions)
| Year | Calculated Debt (Debt-to-GDP Method) | Official Reported Debt (BoT/MoF) | Variance | Variance % |
|---|---|---|---|---|
| 2020 | $26.15 | $31.50 | -$5.35 | -17.0% |
| 2021 | $29.85 | $34.20 | -$4.35 | -12.7% |
| 2022 | $33.92 | $36.80 | -$2.88 | -7.8% |
| 2023 | $37.29 | $38.91 | -$1.62 | -4.2% |
| 2024 | $39.61 | $42.57 | -$2.96 | -6.9% |
| 2025 (Mid-year) | $43.36 | $42.58 | +$0.78 | +1.8% |
| 2025 (Dec - Latest) | $43.36 | $50.85 | -$7.49 | -14.7% |
🚨 Late 2025 Borrowing Surge Detected
The December 2025 figure of TZS 134.9 trillion (USD 50.85 billion) suggests substantial additional borrowing in the second half of 2025 that exceeds IMF projections. This represents a $7.49 billion variance from calculated debt levels, indicating potential acceleration in debt accumulation not captured in mid-year estimates.
Important Note: The variance between calculated debt (from debt-to-GDP ratios applied to GDP) and officially reported debt figures reflects different measurement methodologies, reporting periods (fiscal vs calendar year), exchange rate fluctuations, and the inclusion/exclusion of certain debt categories.
Section 2
Comprehensive Debt Stock Analysis
A detailed examination of Tanzania's total debt stock using multiple methodologies, including the critical breakdown between external and domestic debt components.
Table 4: Total National Debt Stock - Multiple Sources (2020-2025)
| Year | Method A: Debt-to-GDP × GDP | Method B: Official Reports (BoT/MoF) | Method C: TZS Converted | Best Estimate (Weighted Avg) |
|---|---|---|---|---|
| 2020 | $26.15B | $31.50B | $29.80B | $29.15B |
| 2021 | $29.85B | $34.20B | $32.50B | $32.18B |
| 2022 | $33.92B | $36.80B | $35.90B | $35.54B |
| 2023 | $37.29B | $38.91B | $38.20B | $38.13B |
| 2024 | $39.61B | $42.57B | $41.80B | $41.33B |
| 2025 (Mid-year) | $43.36B | $42.58B | $43.00B | $42.98B |
| 2025 (December) | $43.36B | $50.85B | $50.85B | $48.35B |
Methodology Notes:
- Method A: Debt-to-GDP ratio × Nominal GDP (consistent with IMF/World Bank methodology)
- Method B: Official government and Bank of Tanzania reports
- Method C: TZS figures converted at prevailing exchange rates
- Best Estimate: Weighted average favoring official reports when available
Total Debt Stock: Multiple Measurement Methods
Table 5: External vs Domestic Debt Breakdown (2020-2025)
| Year | Total Debt (USD Billion) | External Debt (USD Billion) | External % | Domestic Debt (USD Billion) | Domestic % |
|---|---|---|---|---|---|
| 2020 | $31.50 | $25.58 | 81.2% | $5.92 | 18.8% |
| 2021 | $34.20 | $27.14 | 79.4% | $7.06 | 20.6% |
| 2022 | $36.80 | $33.60 | 91.3% | $3.20 | 8.7% |
| 2023 | $38.91 | $28.88 | 74.2% | $10.03 | 25.8% |
| 2024 | $42.57 | $29.27 | 68.7% | $13.30 | 31.3% |
| 2025 (Mid-year) | $42.58 | $28.00 | 65.8% | $14.58 | 34.2% |
| 2025 (December) | $50.85 | $37.31 | 73.4% | $13.54 | 26.6% |
Debt Composition: External vs Domestic (2020-2025)
Critical Trends Identified
- External Debt Volatility: External debt peaked at 91.3% in 2022, then dropped to 65.8% by mid-2025, before surging back to 73.4% by year-end
- Domestic Debt Expansion: Domestic debt more than doubled from USD 5.92B (2020) to USD 13.30B (2024), reflecting increased internal borrowing
- Structural Shift (2022-2023): A major composition change occurred, with domestic debt jumping from 8.7% to 25.8% in one year
- Late 2025 Borrowing Surge: The Q4 2025 external debt increase of USD 8.27 billion suggests significant new external borrowing
🚨 Q4 2025 External Debt Spike
External debt increased from $28.00B (mid-2025) to $37.31B (December 2025) — a massive $9.31 billion increase in just six months. This represents a 33.3% surge in external obligations, raising concerns about the sustainability of new borrowing commitments and their terms.