Tanzania’s economic performance in March 2025, as detailed in the April 2025 Monthly Economic Review, shows both alignment and divergence with global economic trends. Below, we compare Tanzania’s inflation, growth outlook, and commodity market influences with global forecasts, using specific figures to illustrate the relationship.

Inflation Trends

Global Trend: The IMF forecasts global inflation at 4.3% for 2025, declining to 3.6% in 2026, reflecting a slower-than-expected easing due to trade tensions and persistent pressures in advanced economies. Inflation is decreasing but remains above pre-pandemic levels in many countries.

Tanzania’s Performance: Tanzania’s headline inflation was 3.3% in March 2025, up from 3.0% in March 2024, driven by food (5.4%) and energy, fuel, and utilities (7.9%) price increases (Pages 3, 4, 5). Core inflation, excluding volatile items, fell to 2.2% from 3.9%.

Tanzania’s inflation is lower than the global forecast of 4.3%, aligning with the global trend of declining inflation. However, its food and energy-driven inflation spike mirrors global pressures from supply constraints and trade disruptions. Tanzania’s inflation remains within national and regional (EAC and SADC) targets, indicating stronger control compared to some advanced economies facing persistent pressures.

Economic Growth Outlook

Global Trend: The IMF revised global growth downward to 2.8% for 2025 and 3.0% for 2026, from 3.3% for both years, due to trade tensions, unpredictable policies, and diminishing fiscal buffers. Risks include climate change and limited fiscal space in developing economies.

Tanzania’s Performance: The document does not provide a specific GDP growth rate for Tanzania in 2025 but notes that monetary policy supports economic growth while maintaining inflation below 5%. Domestic challenges include rising food and energy prices and logistical issues from seasonal rains.

Tanzania faces similar downside risks as the global economy, such as trade tensions and climate-related disruptions (e.g., heavy rains impacting food transport). However, its stable monetary policy (Central Bank Rate at 6%) and adequate liquidity suggest resilience compared to developing economies with limited fiscal space. Tanzania’s growth is likely moderated but supported by prudent policies, aligning with the global trend of cautious optimism.

Commodity Market Influences

Global Trend: Commodity markets show divergent trends:

• Gold prices rose 3% to USD 2,983.25 per ounce due to safe-haven demand.
• Fertilizer prices increased 2% to USD 615.13 per tonne due to supply constraints.
• Palm oil prices edged up 0.2% to USD 1,069 per tonne on Asian demand.
• Crude oil prices fell 4% to USD 70.70 per barrel due to oversupply.
• Coffee and sugar prices dropped 2% and 1.5%, respectively, due to improved production.

Tanzania’s Performance: Tanzania, a commodity-dependent economy, is impacted by these trends:

• Gold: Rising gold prices benefit Tanzania’s export revenues, as gold is a major export.
• Fertilizer: Higher fertilizer prices increase agricultural input costs, potentially raising food prices (e.g., maize, rice, beans), contributing to 5.4% food inflation.
• Palm Oil: Stable palm oil prices support Tanzania’s edible oil sector, aligning with robust Asian demand.
• Crude Oil: Lower oil prices reduce Tanzania’s import bill, easing pressure on energy inflation (7.9%) despite domestic petroleum price hikes.
• Coffee and Sugar: Declining coffee and sugar prices may reduce export earnings, impacting trade balance.

Tanzania’s economy is closely tied to global commodity price movements. Positive trends (gold, palm oil) bolster exports, while negative trends (fertilizer, coffee, sugar) pose challenges. The drop in crude oil prices provides relief, aligning with global oversupply benefits, but domestic supply chain issues amplify food price pressures, diverging from global commodity price declines in some sectors.

Policy and Structural Considerations

Global Trend: The global economic outlook is tilted downward due to trade tensions, unpredictable policies, and climate change, particularly affecting developing economies with limited fiscal buffers.

Tanzania’s Performance: Tanzania’s monetary policy remains stable, with the Bank of Tanzania maintaining the Central Bank Rate at 6% and ensuring liquidity through interbank rate management (Page 5). The National Food Reserve Agency’s release of 32,598 tonnes of maize and paddy mitigated food inflation (Page 4). However, logistical challenges and climate-related rains increase costs.

Tanzania’s proactive policies align with global efforts to stabilize economies amid uncertainties. Its food reserve strategy counters global supply chain disruptions, and monetary stability mitigates trade tension impacts. However, climate change (seasonal rains) and limited fiscal space, common in developing economies, pose shared challenges.

Conclusion

Tanzania’s economic performance in March 2025 aligns with global trends in declining inflation (3.3% vs. 4.3% globally) and cautious growth outlooks, supported by stable monetary policy and commodity export strengths (e.g., gold). However, it faces unique pressures from food (5.4%) and energy (7.9%) inflation, driven by domestic logistical issues and global commodity price hikes (e.g., fertilizer). While global risks like trade tensions and climate change affect Tanzania, its prudent policies and food reserves provide resilience, positioning it favorably among developing economies.

Key Economic Indicators: Tanzania vs. Global Trends (March 2025)

Notes:

• Tanzania’s data reflects March 2025 unless stated otherwise.
• Global figures are IMF forecasts or commodity price changes for March 2025.
• Source pages refer to the April 2025 Monthly Economic Review.

Tanzania inflation landscape from 2015 to 2025 reflects a dynamic shift from high volatility to relative stability, driven by economic policies, global events, and market dynamics. The provided dataset, spanning January 2015 to May 2025, shows inflation rates declining from a peak of 6.5% in January 2015 to a stable range of 3.0%-3.3% in 2023-2024, with a forecasted 2025 average of 3.2%. A notable spike occurred in 2021, averaging 4.3%, likely due to post-COVID recovery and supply chain disruptions. This analysis forecasts inflation for June to December 2025, predicting continued stability at 3.2%-3.3%, influenced by pot ential tariff impacts and energy prices. Visualizations such as line plots, bar charts, box plots, and heatmaps are proposed to illustrate these trends, highlighting the transition to lower, more predictable inflation rates over the decade.

Analysis of Monthly Inflation Data

1. Yearly Trends and Patterns

• 2015: Inflation fluctuated between 4.5% (September/October) and 6.5% (January), averaging around 5.2%. The year showed moderate volatility, with a general decline toward the end of the year.
• 2016: Inflation ranged from 4.0% (December) to 6.4% (March/April), with an average of about 5.3%. This year saw higher peaks compared to 2015, particularly in March and April.
• 2017: Inflation was notably lower, ranging from 3.0% (November) to 4.1% (February), averaging around 3.5%. This indicates a period of relative stability and lower inflation compared to previous years.
• 2018: Inflation remained stable, fluctuating between 3.0% (January/February) and 3.8% (November/December), with an average of about 3.5%. The range was narrow, suggesting consistent economic conditions.
• 2019: Inflation was tightly clustered, ranging from 3.0% (November) to 3.7% (January/February), averaging around 3.3%. This year showed low volatility and stable inflation.
• 2020: Inflation ranged from 3.2% (March) to 4.2% (December), averaging about 3.7%. There was a slight increase compared to 2019, possibly due to economic disruptions (e.g., early COVID-19 impacts).
• 2021: Inflation rose significantly, ranging from 3.6% (March) to 4.9% (October/November), averaging around 4.3%. This was the highest average in the dataset, likely reflecting post-COVID economic recovery and supply chain issues.
• 2022: Inflation ranged from 3.0% (December) to 4.9% (January), averaging about 3.8%. After peaking early in the year, inflation trended downward, stabilizing by year-end.
• 2023: Inflation was highly stable, ranging from 3.0% (January/February/March/December) to 3.3% (July-September), averaging around 3.1%. This was one of the most stable years in the dataset.
• 2024: Inflation remained stable, ranging from 3.0% (October/November) to 3.3% (March), averaging about 3.1%. The trend continued the stability seen in 2023.
• 2025 (January-May): Data shows inflation between 3.0% (January) and 3.3% (March), averaging around 3.2%. The limited data suggests continued stability, consistent with 2023 and 2024.

2. Key Observations

• Highest Inflation: The highest inflation rate was 6.5% in January 2015, followed by 6.4% in March and April 2016. These peaks occurred early in the dataset, suggesting a period of higher economic volatility.
• Lowest Inflation: The lowest rate was 3.0%, observed multiple times (e.g., November 2017, January/February 2018, November 2019, January-March/December 2023, October/November 2024, January 2025). These lows are concentrated in later years, indicating a trend toward lower and more stable inflation.
• Volatility: The early years (2015-2016) showed higher volatility (range of 2.0% and 2.4%, respectively), while later years (2019, 2023, 2024) had very low volatility (range of 0.7% or less). This suggests improved economic stability over time.
• Long-Term Trend: Inflation generally trended downward from 2015 (average ~5.2%) to 2023-2024 (average ~3.1%). The exception was 2021, which saw a spike (average ~4.3%), likely due to global economic recovery post-COVID.
• Seasonal Patterns: There’s no strong evidence of consistent seasonal patterns (e.g., specific months always having higher/lower inflation). However, January often had slightly higher inflation in earlier years (2015, 2016, 2022), while November and December frequently showed lower rates in later years (2017, 2019, 2023, 2024).

3. Yearly Averages

To quantify the trends, here are the approximate yearly average inflation rates:

• 2015: 5.2%
• 2016: 5.3%
• 2017: 3.5%
• 2018: 3.5%
• 2019: 3.3%
• 2020: 3.7%
• 2021: 4.3%
• 2022: 3.8%
• 2023: 3.1%
• 2024: 3.1%
• 2025 (Jan-May): 3.2%

The inflation data from 2015 to 2025 shows a general decline from higher, more volatile rates (~5.2% in 2015-2016) to lower, stable rates (~3.1% in 2023-2024), with a notable spike in 2021 (~4.3%). Visualizations like line plots, bar charts, box plots, and heatmaps can effectively illustrate these trends, highlighting yearly differences, volatility, and the lack of strong seasonal patterns. If you need specific instructions for creating these figures or further analysis (e.g., statistical tests), let me know!

Forecasting Methodology

1. Historical Data Analysis:
   • The provided table shows inflation rates from 2015 to May 2025. For 2025, the available data (January to May) ranges from 3.0% to 3.3%, with an average of approximately 3.2%. This suggests continued stability, consistent with 2023 and 2024 averages (~3.1%).
   • Historical trends indicate a decline in volatility over time, with recent years (2023-2024) showing a tight range (0.3% variation). The 2025 data so far aligns with this low-volatility trend.
   • No strong seasonal patterns are evident, but early months (e.g., January) occasionally show slight upticks, while later months (e.g., November, December) often stabilize or dip slightly.

Forecasted Inflation Rates for 2025

Below is the table incorporating the provided 2025 data (January to May) and the forecasted values for June to December, with key figures highlighted.

Key Figures:

• 2025 Average: 3.2% (calculated as the mean of January to December 2025 forecasts).
• Highest 2025 Rate: 3.3% (March, September, October, November, December).
• Lowest 2025 Rate: 3.0% (January).
• Range in 2025: 0.3% (3.0% to 3.3%), indicating continued low volatility.
• Comparison to 2024: The 2025 average (3.2%) is slightly higher than 2024’s 3.1%, reflecting potential tariff-driven increases.
• Comparison to Historical Peak: The 2025 forecast is significantly lower than the 2015 peak (6.5% in January) and the 2021 average (4.3%).

Explanation of Forecast

• June to August (3.2%): The forecast assumes stability around the 3.1%-3.2% SMA, with a slight upward adjustment (+0.02% to +0.04%) for early tariff effects, as sources suggest a 3-6 month lag.
• September to December (3.3%): The slight increase to 3.3% aligns with NIESR’s prediction of inflation rising above 3% from June onward and accounts for cumulative tariff impacts and potential energy price pressures
• Rationale for Stability: The tight range in 2023-2024 (0.3%) and early 2025 (0.3%) supports a stable forecast. The regression model’s slight upward trend (+0.01% per month) is tempered by the Fed’s efforts to maintain inflation near 2% (PCE), though CPI runs higher.
• Risk Factors:
  • Upside Risk: Tariffs could push inflation toward 4.0%, as per Vanguard and prediction markets. If tariff effects are stronger, December 2025 could reach 3.5%.

Conclusion

The 2025 inflation forecast for June to December predicts rates between 3.2% and 3.3%, with an annual average of 3.2%, slightly above the 2024 average of 3.1%. This reflects stable economic conditions with a modest upward bias due to potential tariff and energy price pressures.

In 2024, Tanzania’s trade profile reflects its position as a developing economy reliant on primary commodity exports and significant imports of energy and capital goods. With total exports valued at $7.06 billion and imports at $12.05 billion, the country recorded a trade deficit of $4.99 billion. Exports are dominated by precious stones (52.4%), particularly gold and tanzanite, alongside agricultural products like fruits, tobacco, and coffee, which collectively contribute ~27% of export value. Imports are led by mineral fuels (25.9%), machinery (14.1%), and vehicles (14.5%), highlighting Tanzania’s dependence on foreign energy and industrial inputs. This trade imbalance significantly impacts the balance of payments, with an estimated current account deficit of $2.49 billion, partially offset by tourism and remittances, and financed by foreign direct investment (FDI) and loans. This analysis examines the key figures, their implications, and strategies to strengthen Tanzania’s trade and BoP position.

1. Export Figures and Composition

• Total Export Value: $7,063,098,000.
• Total Export Weight: 8,702,027,904 kg.
• Top Export Categories:
  • Natural/Cultured Pearls, Precious Stones, Metals, Coins, etc.: $3,702,006,668 (52.4% of total export value, 25,475,294 kg, 0.3% of weight).
    • Key Products: Gold and tanzanite, critical for foreign exchange earnings. Their high value-to-weight ratio underscores Tanzania’s mining sector strength.
    • Implication: This category’s dominance makes exports vulnerable to global price volatility, risking BoP instability if prices fall.
  • Edible Fruits and Nuts: $618,872,845 (8.8%, 486,249,663 kg, 5.6%).
    • Key Products: Cashew nuts, avocados, mangoes.
    • Implication: Significant for rural economies, but raw exports limit value addition.
  • Tobacco and Manufactured Tobacco Substitutes: $545,622,444 (7.7%, 114,290,786 kg, 1.3%).
    • Key Products: Processed tobacco for global markets.
    • Implication: A stable earner, but diversification into other processed goods could enhance value.
  • Edible Vegetables and Certain Roots and Tubers: $392,039,771 (5.5%, 655,797,745 kg, 7.5%).
    • Key Products: Cassava, potatoes, beans.
    • Implication: High volume reflects regional trade strength, but low value per kg suggests bulk, unprocessed exports.
  • Coffee, Tea, Mate, and Spices: $351,574,312 (5.0%, 108,360,278 kg, 1.2%).
    • Key Products: Coffee, cloves (from Zanzibar).
    • Implication: Traditional exports with potential for higher earnings through processing (e.g., roasted coffee).
• Insight: Exports are heavily concentrated in primary commodities (~80% of value from precious stones and agriculture), with precious stones alone contributing over half the revenue. This lack of diversification limits resilience, as a drop in gold or tanzanite prices could reduce export earnings by ~$1.8–2 billion (assuming a 50% price decline).

2. Import Figures and Composition

• Total Import Value: $12,051,010,000.
• Total Import Weight: 15,684,509,316 kg.
• Top Import Categories:
  • Mineral Fuels, Oils, and Products of Their Distillation: $3,116,521,534 (25.9%, 4,850,718,867 kg, 30.9%).
    • Key Products: Petroleum products, diesel.
    • Implication: Energy dependency drains foreign exchange, with ~$3.1 billion spent annually, a major BoP pressure point.
  • Vehicles (Non-Railway): $1,749,632,899 (14.5%, 487,514,203 kg, 3.1%).
    • Key Products: Cars, trucks, motorcycles.
    • Implication: Supports transport infrastructure but contributes significantly to the trade deficit.
  • Nuclear Reactors, Boilers, Machinery, and Mechanical Appliances: $1,694,274,504 (14.1%, 319,673,868 kg, 2.0%).
    • Key Products: Industrial machinery for manufacturing, construction.
    • Implication: Essential for industrialization but increases import costs in the short term.
  • Electrical Machinery and Equipment: $1,022,094,834 (8.5%, 199,416,625 kg, 1.3%).
    • Key Products: Electronics, telecom equipment.
    • Implication: Supports technology and infrastructure development, adding to the deficit.
  • Plastics and Articles Thereof: $874,886,359 (7.3%, 718,520,526 kg, 4.6%).
    • Key Products: Packaging, consumer goods.
    • Implication: Reflects growing consumer and industrial demand, contributing to import costs.
• Insight: Imports are diverse, with energy (25.9%) and capital goods (machinery, vehicles, ~28.6% combined) dominating. Food imports like cereals ($420.4 million, 3.5%) and sugars ($422.6 million, 3.5%) indicate gaps in domestic production, straining the BoP.

3. Trade Balance

• Calculation:
  • Exports: $7,063,098,000.
  • Imports: $12,051,010,000.
  • Trade Deficit: -$4,987,912,000 (~70.6% of export value).
• Implication: The $4.99 billion deficit reflects Tanzania’s reliance on imported energy and capital goods to support growth, necessitating external financing to maintain BoP stability.

4. Balance of Payments (BoP) Impact

The trade deficit is a major component of the current account, which also includes services, primary income (e.g., investment income), and secondary income (e.g., remittances). Using the trade data and estimates from prior analysis:

• Current Account:
  • Trade Balance (Goods): -$4,987,912,000 (200% of the current account deficit).
  • Services Balance: ~+$1,500,000,000 (60% offset, driven by tourism revenue from Serengeti, Zanzibar).
  • Primary Income: ~-$500,000,000 (20% worsening, due to profit repatriation by foreign mining firms).
  • Secondary Income: ~+$1,500,000,000 (60% offset, from remittances ~$400–500 million and aid ~$1 billion).
  • Estimated Current Account Deficit: ~-$2,487,912,000.
• Capital Account:
  • ~+$500,000,000 (from grants, e.g., for infrastructure projects).
• Financial Account:
  • ~+$2,000,000,000 (from FDI in mining/energy and loans, e.g., from China for ports/railways).
• Overall BoP Balance:
  • Current Account: -$2,487,912,000.
  • Capital + Financial Accounts: +$2,500,000,000.
  • Net BoP Deficit: ~-$12,912,000 (financed by drawing down reserves).
• Percentage Insights:
  • The trade deficit drives ~200% of the current account deficit, making it the primary BoP challenge.
  • Tourism and remittances/aid offset ~120% of the trade deficit, highlighting their critical role.
  • FDI and loans cover ~100% of the current account deficit, but reliance on external financing risks debt accumulation.

5. Economic Implications and Recommendations

• Export Dependence: Precious stones (52.4%) and agriculture (~27%) dominate exports, but reliance on raw goods limits value. Processing cashews or coffee could increase earnings by ~20–30% per unit (e.g., roasted coffee fetches higher prices).
• Import Pressures: Fuel imports ($3.1 billion, 25.9%) are a major BoP drain. Leveraging Tanzania’s offshore gas reserves could save ~$1–2 billion annually.
• Food Security: Cereal imports ($420.4 million) suggest domestic shortfalls. Boosting local production could reduce this by ~50%, saving ~$200 million.
• BoP Strategy:
  • Diversify Exports: Invest in agro-processing (e.g., $100 million in cashew processing plants could boost fruit/nut exports by 10–15%).
  • Reduce Fuel Imports: Develop domestic gas infrastructure to cut ~30% of fuel import costs.
  • Enhance Tourism: Increase tourism revenue by 10% (~$150 million) through marketing.
  • Sustainable FDI: Attract FDI in manufacturing to reduce import reliance on machinery/plastics (~$2.5 billion combined).

Conclusion

Tanzania’s trade data reveals a $4.99 billion trade deficit, driven by high imports of mineral fuels (25.9%), machinery (14.1%), and vehicles (14.5%), against exports dominated by precious stones (52.4%) and agricultural goods (~27%). This trade deficit contributes to an estimated current account deficit of $2.49 billion, partially offset by tourism (~$1.5 billion) and remittances/aid (~$1.5 billion). The BoP is balanced by capital inflows (~$500 million) and financial inflows (~$2 billion from FDI/loans), with a small residual deficit (~$12.9 million) likely financed by reserves. To improve the BoP, Tanzania should diversify exports, reduce fuel imports, and enhance tourism and agricultural productivity.

Tanzania Export and Import Summary Table

Notes

• Export Insights: Exports are dominated by primary commodities, with precious stones (52.4%) reflecting Tanzania’s mining strength (gold, tanzanite). Agricultural products like fruits, tobacco, vegetables, and coffee contribute ~27%, but the reliance on raw goods highlights the need for value-added processing.
• Import Insights: Imports are led by mineral fuels (25.9%), machinery (14.1%), and vehicles (14.5%), indicating energy dependency and investment in infrastructure. Cereals and sugars (not in top 5 but notable at ~7% combined) suggest food security gaps.
• Trade Balance: The $4.99 billion deficit drives a current account deficit, estimated at ~$2.49 billion, partially offset by tourism (~$1.5 billion) and remittances/aid (~$1.5 billion). Capital and financial inflows (~$2.5 billion) finance most of the deficit.
• BoP Implications: The trade deficit strains foreign exchange reserves, requiring FDI and loans. Diversifying exports and reducing fuel imports are critical for BoP stability.

The cement consumption data from 2015 to 2024 reveals a significant transformation in the cement industry, characterized by a near doubling of net consumption, a dramatic rise in domestic production, and a marked decline in reliance on imports. Over this decade, net cement consumption grew from 3,907,949 tons in 2015 to 7,705,918 tons in 2024, driven by robust domestic manufacturing and shifting trade dynamics. This analysis explores key trends in manufactured, imported, and exported cement, highlighting percentage changes and quarterly patterns to provide insights into the industry’s evolution.

Key Metrics and Observations

1. Net Cement Consumption Growth (2015–2024):
   • 2015 Total: 3,907,949 tons
   • 2024 Total: 7,705,918 tons
   • Growth: =97.17% Net cement consumption nearly doubled over the decade, increasing by 97.17%. The growth reflects rising demand, likely driven by infrastructure development or economic expansion.
2. Manufactured Cement:
   • 2015 Total: 3,140,160 tons
   • 2024 Total: 7,699,840 tons
   • Growth: =145.21% Domestic production surged by 145.21%, indicating significant investment in local manufacturing capacity. The highest annual manufactured total was in 2022 (7,598,073 tons), slightly dipping in 2023 (7,673,016 tons) and 2024 (7,699,840 tons).
   • Quarterly Trends:
     • The October–December quarter consistently shows high production, peaking in 2024 Q4 at 2,313,251 tons, a 163.38% increase from 2015 Q4 (878,298 tons).
     • July–September also shows strong growth, with 2024 Q3 (2,144,208 tons) up 145.76% from 2015 Q3 (872,397 tons).
3. Imported Cement:
   • 2015 Total: 896,872 tons
   • 2024 Total: 398,039 tons
   • Decline: −55.63% Imports dropped significantly by 55.63%, suggesting a shift toward self-reliance in cement production. The peak import year was 2015 (896,872 tons), while the lowest was 2017 (188,599 tons).
   • Quarterly Trends:
     • Imports were highest in 2015 Q1 (283,231 tons) and lowest in 2024 Q3 (32,876 tons, an 88.39% decline from 2015 Q1).
     • 2023 saw a temporary spike in imports (809,199 tons), but 2024 imports fell sharply to 398,039 tons, likely due to increased domestic capacity.
4. Exported Cement:
   • 2015 Total: 129,083 tons
   • 2024 Total: 391,961 tons
   • Growth: =203.62% Exports grew dramatically by 203.62%, reflecting improved competitiveness in international markets. The highest export year was 2023 (531,699 tons), with a slight decline in 2024.
   • Quarterly Trends:
     • July–September exports peaked in 2020 Q3 (206,892 tons), a 348.92% increase from 2015 Q3 (46,089 tons).
     • 2024 Q4 exports (119,514 tons) were up 216.88% from 2015 Q4 (37,723 tons).
5. Net Cement Consumption by Quarter:
   • January–March:
     • 2015: 946,454 tons
     • 2024: 1,688,512 tons
     • Growth: 78.40%
   • April–June:
     • 2015: 932,831 tons
     • 2024: 1,675,257 tons
     • Growth: 79.59%
   • July–September:
     • 2015: 1,038,969 tons
     • 2024: 2,064,538 tons
     • Growth: 98.73% (highest quarterly growth)
   • October–December:
     • 2015: 989,696 tons
     • 2024: 2,277,611 tons
     • Growth: 130.14% (strongest quarterly performance)
   • The October–December quarter consistently shows the highest consumption in later years, particularly in 2024 Q4 (2,277,611 tons).

Year-by-Year Analysis with Percentages

• 2015–2016:
  • Net Consumption: +10.24% (3,907,949 to 4,307,513 tons)
  • Manufactured: +28.89% (3,140,160 to 4,047,712 tons)
  • Imported: -42.76% (896,872 to 513,307 tons)
  • Exported: +96.39% (129,083 to 253,506 tons)
  • Insight: Strong growth in domestic production and exports, with a sharp decline in imports, indicates a shift toward local manufacturing.
• 2016–2017:
  • Net Consumption: +1.21% (4,307,513 to 4,359,696 tons)
  • Manufactured: +8.65% (4,047,712 to 4,397,684 tons)
  • Imported: -63.26% (513,307 to 188,599 tons)
  • Exported: -10.62% (253,506 to 226,588 tons)
  • Insight: Imports plummeted, likely due to increased domestic capacity, while exports dipped slightly.
• 2017–2018:
  • Net Consumption: +7.46% (4,359,696 to 4,685,039 tons)
  • Manufactured: +3.24% (4,397,684 to 4,540,309 tons)
  • Imported: +80.92% (188,599 to 341,179 tons)
  • Exported: -13.29% (226,588 to 196,449 tons)
  • Insight: A rebound in imports and steady consumption growth suggest demand outpacing local production growth.
• 2018–2019:
  • Net Consumption: +13.73% (4,685,039 to 5,328,850 tons)
  • Manufactured: +16.54% (4,540,309 to 5,290,878 tons)
  • Imported: +31.46% (341,179 to 448,579 tons)
  • Exported: +108.99% (196,449 to 410,607 tons)
  • Insight: Significant export growth and strong domestic production indicate market expansion.
• 2019–2020:
  • Net Consumption: +9.39% (5,328,850 to 5,828,688 tons)
  • Manufactured: +5.94% (5,290,878 to 5,605,626 tons)
  • Imported: +59.82% (448,579 to 716,929 tons)
  • Exported: +20.25% (410,607 to 493,867 tons)
  • Insight: Imports surged, possibly due to supply chain constraints or demand spikes.
• 2020–2021:
  • Net Consumption: +17.78% (5,828,688 to 6,863,004 tons)
  • Manufactured: +18.00% (5,605,626 to 6,614,359 tons)
  • Imported: -3.68% (716,929 to 690,474 tons)
  • Exported: -10.54% (493,867 to 441,828 tons)
  • Insight: Robust consumption growth driven by domestic production, with imports and exports slightly declining.
• 2021–2022:
  • Net Consumption: +13.97% (6,863,004 to 7,823,361 tons)
  • Manufactured: +14.86% (6,614,359 to 7,598,073 tons)
  • Imported: +3.81% (690,474 to 716,826 tons)
  • Exported: +11.24% (441,828 to 491,538 tons)
  • Insight: Strong domestic production and consumption growth, with stable import and export levels.
• 2022–2023:
  • Net Consumption: +1.63% (7,823,361 to 7,950,515 tons)
  • Manufactured: +0.99% (7,598,073 to 7,673,016 tons)
  • Imported: +12.87% (716,826 to 809,199 tons)
  • Exported: +8.17% (491,538 to 531,699 tons)
  • Insight: Slower consumption growth, with imports rising to meet demand.
• 2023–2024:
  • Net Consumption: -3.05% (7,950,515 to 7,705,918 tons)
  • Manufactured: +0.35% (7,673,016 to 7,699,840 tons)
  • Imported: -50.82% (809,199 to 398,039 tons)
  • Exported: -26.29% (531,699 to 391,961 tons)
  • Insight: A decline in consumption, imports, and exports suggests a possible market slowdown or overcapacity in 2024.

Key Trends and Insights

1. Domestic Production Dominance:
   • The share of manufactured cement in net consumption grew from 80.36% in 2015 (3,140,160 ÷ 3,907,949) to 99.92% in 2024 (7,699,840 ÷ 7,705,918). This reflects a strong shift toward self-sufficiency.
2. Declining Reliance on Imports:
   • Imports as a percentage of net consumption dropped from 22.95% in 2015 (896,872 ÷ 3,907,949) to 5.16% in 2024 (398,039 ÷ 7,705,918). The sharp decline in 2024 imports indicates robust local supply.
3. Export Growth:
   • Exports as a percentage of manufactured cement rose from 4.11% in 2015 (129,083 ÷ 3,140,160) to 5.09% in 2024 (391,961 ÷ 7,699,840), peaking at 6.93% in 2023 (531,699 ÷ 7,673,016).
4. Seasonal Patterns:
   • The July–September and October–December quarters consistently show higher consumption, likely tied to construction cycles. For example, 2024 Q4 (2,277,611 tons) was the highest quarterly consumption in the dataset.
5. 2024 Slowdown:
   • The 3.05% decline in net consumption from 2023 to 2024, coupled with a 50.82% drop in imports and 26.29% drop in exports, suggests a potential market correction or reduced demand.

Conclusion

The cement consumption data from 2015 to 2024 shows a robust increase in domestic production (+145.21%) and exports (+203.62%), with a significant reduction in import reliance (-55.63%). Net consumption grew by 97.17%, driven by infrastructure demand, with the strongest growth in October–December quarters. However, 2024 indicates a potential slowdown, with declines in consumption, imports, and exports. This could reflect market saturation, economic shifts, or reduced construction activity, warranting further investigation into external factors like economic policies or global trade dynamics.

Explanation of Key Figures

• Manufactured: Grew by 145.21% from 3,140,160 tons in 2015 to 7,699,840 tons in 2024, reflecting significant expansion in domestic production capacity.
• Imported: Declined by 55.63% from 896,872 tons in 2015 to 398,039 tons in 2024, indicating reduced reliance on imports.
• Exported: Increased by 203.62% from 129,083 tons in 2015 to 391,961 tons in 2024, with a peak in 2023 (531,699 tons).
• Net Consumption: Rose by 97.17% from 3,907,949 tons in 2015 to 7,705,918 tons in 2024, with the highest quarterly peak in 2024 Q4 (2,277,611 tons).
• Peak Quarter: The October–December quarter frequently shows the highest consumption, with 2024 Q4 being the highest in the dataset, up 130.14% from 2015 Q4 (989,696 tons).

The Bank of Tanzania’s Statement of Financial Position as of April 30, 2025, reveals a 1.12% increase in total assets, rising from TZS 26,363,434,564,000 in March 2025 to TZS 26,659,694,908,000. This growth reflects active economic management, with a significant 18.16% surge in advances to governments (from TZS 4,763,947,771,000 to TZS 5,629,169,678,000), indicating strong fiscal support for public spending, likely tied to Tanzania’s 2025 development goals. A 20.24% rise in inventories (from TZS 698,676,255,000 to TZS 840,111,691,000) suggests preparation for increased economic activity, while a 6.16% increase in equity (from TZS 2,813,895,536,000 to TZS 2,987,283,005,000) strengthens financial resilience. However, an 11.43% drop in cash and equivalents (from TZS 5,814,826,587,000 to TZS 5,150,530,010,000) and a 63.60% spike in other liabilities (from TZS 198,279,791,000 to TZS 324,413,464,000) highlight liquidity management and potential fiscal pressures.

These figures underscore Tanzania’s balanced approach to supporting 5.5–6% projected GDP growth in 2025 while maintaining monetary stability.

1. Total Assets

• April 30, 2025: TZS 26,659,694,908
• March 31, 2025: TZS 26,363,434,564
• Change: Increase of TZS 296,260,344
• Percentage Change:1.12%

Total assets grew by 1.12% month-over-month, indicating a slight expansion in the Bank’s asset base. Let’s break down the key contributors to this change.

Key Asset Changes

Cash and Cash Equivalents:

1. April: TZS 5,150,530,010
2. March: TZS 5,814,826,587
3. Change: Decrease of TZS 664,296,577
4. Percentage Change: -11.43%
5. Insight: A significant 11.43% drop in cash and equivalents suggests reduced liquidity, possibly due to increased lending, investments, or settlement activities.

Advances to Governments:

1. April: TZS 5,629,169,678
2. March: TZS 4,763,947,771
3. Change: Increase of TZS 865,221,907
4. Percentage Change: 18.16%
5. Insight: The 18.16% increase in advances to governments is the largest driver of asset growth, indicating significant lending or financial support to the government in April.

Inventories:

1. April: TZS 840,111,691
2. March: TZS 698,676,255
3. Change: Increase of TZS 141,435,436
4. Percentage Change: 20.24%
5. Insight: A 20.24% rise in inventories (possibly currency or other reserves) suggests stockpiling or preparation for increased circulation.

Foreign Currency Marketable Securities:

1. April: TZS 8,790,819,501
2. March: TZS 8,978,815,336
3. Change: Decrease of TZS 187,995,835
4. Percentage Change: -2.09%
5. Insight: A 2.09% reduction may reflect sales of securities or market value adjustments, possibly to fund other activities like advances to governments.

Gold:

1. April: TZS 104,372,142
2. March: TZS 96,633,290
3. Change: Increase of TZS 7,738,852
4. Percentage Change: 8.01%
5. Insight: An 8.01% increase in gold holdings could reflect rising gold prices or additional purchases, strengthening the Bank’s reserve position.

Items in Course of Settlement:

1. April: TZS 65,828,437
2. March: TZS 0
3. Change: Increase of TZS 65,828,437
4. Percentage Change: Not applicable (March value is zero).
5. Insight: The appearance of this item suggests pending transactions or settlements that were not present in March.

2. Total Liabilities

• April 30, 2025: TZS 23,672,411,903
• March 31, 2025: TZS 23,549,539,028
• Change: Increase of TZS 122,872,875
• Percentage Change: 0.52%

Liabilities grew by 0.52%, a smaller increase compared to assets, suggesting the Bank’s financial position strengthened slightly.

Key Liability Changes

Deposits - Banks and Non-Bank Financial Institutions:

1. April: TZS 3,736,660,067
2. March: TZS 3,612,551,132
3. Change: Increase of TZS 124,108,935
4. Percentage Change: 3.44%
5. Insight: A 3.44% increase in deposits from financial institutions indicates higher confidence or liquidity in the banking sector.

Other Liabilities:

1. April: TZS 324,413,464
2. March: TZS 198,279,791
3. Change: Increase of TZS 126,133,673
4. Percentage Change: 63.60%
5. Insight: The sharp 63.60% rise suggests new obligations or accrued expenses, possibly related to operational or policy activities.

Foreign Currency Financial Liabilities:

1. April: TZS 4,780,635,213
2. March: TZS 4,898,553,860
3. Change: Decrease of TZS 117,918,647
4. Percentage Change: -2.41%
5. Insight: A 2.41% reduction may indicate repayment of foreign obligations or favorable exchange rate movements.

Currency in Circulation:

1. April: TZS 8,140,182,041
2. March: TZS 8,169,936,634
3. Change: Decrease of TZS 29,754,593
4. Percentage Change: -0.36%
5. Insight: A slight 0.36% decrease in currency in circulation may reflect reduced cash demand or withdrawal from circulation.

Allocation of Special Drawing Rights (SDRs):

1. April: TZS 2,077,052,451
2. March: TZS 2,013,963,428
3. Change: Increase of TZS 63,089,023
4. Percentage Change: 3.13%
5. Insight: A 3.13% increase aligns with the rise in SDR holdings on the asset side, reflecting IMF-related adjustments.

Items in Course of Settlement:

1. April: TZS 0
2. March: TZS 71,395,912
3. Change: Decrease of TZS 71,395,912
4. Percentage Change: Not applicable (April value is zero).
5. Insight: The clearing of this liability suggests settlements were completed in April.

3. Total Equity

• April 30, 2025: TZS 2,987,283,005
• March 31, 2025: TZS 2,813,895,536
• Change: Increase of TZS 173,387,469
• Percentage Change: 6.16%

Analysis: Equity increased by 6.16%, driven entirely by a rise in reserves, as the authorized and paid-up capital remained unchanged at TZS 100,000,000.

Reserves:

• April: TZS 2,887,283,005
• March: TZS 2,713,895,536
• Change: Increase of TZS 173,387,469
• Percentage Change: 6.39%
• Insight: The 6.39% growth in reserves indicates improved financial health, possibly due to retained earnings or revaluation gains (e.g., gold or foreign currency).

Key Observations and Insights

1. Asset Composition:
   • The largest asset categories are Foreign Currency Marketable Securities (32.97% of total assets in April) and Advances to Governments (21.11%). The significant increase in advances to governments (18.16%) suggests a policy focus on supporting public finances.
   • The drop in cash and equivalents (-11.43%) and foreign currency securities (-2.09%) may indicate a shift of funds to government lending or other investments.
2. Liability Structure:
   • Currency in Circulation (34.36% of total liabilities) and Foreign Currency Financial Liabilities (20.19%) are the largest liability categories. The slight reduction in currency in circulation (-0.36%) and foreign liabilities (-2.41%) suggests controlled monetary expansion and debt management.
   • The sharp rise in Other Liabilities (63.60%) warrants further investigation, as it could reflect new commitments or operational costs.
3. Equity Growth:
   • The 6.16% increase in equity, driven by reserves, strengthens the Bank’s capital position, enhancing its ability to absorb shocks.
4. Balance Sheet Stability:
   • The asset growth (1.12%) outpacing liability growth (0.52%) resulted in a stronger equity position, indicating financial stability.
   • The net increase in total assets matches the sum of liabilities and equity (TZS 26,659,694,908), confirming the balance sheet’s accuracy.

Key Economic Updates from the Statement

1. Increased Government Financing Suggests Fiscal Support

• Advances to Governments:
  • April 2025: TZS 5,629,169,678
  • March 2025: TZS 4,763,947,771
  • Change: Increase of TZS 865,221,907 (+18.16%)
• Economic Implication:
  • The significant 18.16% increase in advances to governments indicates heightened central bank support for public expenditure. This suggests the Tanzania government may be facing fiscal pressures, possibly due to infrastructure projects, social programs, or debt servicing needs.
  • This aligns with Tanzania’s focus on development projects under the Third Five-Year Development Plan (FYDP III, 2021/22–2025/26), which emphasizes infrastructure and industrialization. The central bank’s lending likely supports these initiatives, but it could also signal reliance on domestic financing if external borrowing is constrained.

2. Reduced Liquidity Reflects Active Monetary Management

• Cash and Cash Equivalents:
  • April 2025: TZS 5,150,530,010
  • March 2025: TZS 5,814,826,587
  • Change: Decrease of TZS 664,296,577 (-11.43%)
• Economic Implication:
  • The 11.43% drop in cash and equivalents suggests the Bank of Tanzania is actively managing liquidity, possibly to fund government advances or settle transactions (evidenced by the new TZS 65,828,437 in “Items in Course of Settlement”).
  • This could indicate tighter monetary conditions to control inflation or stabilize the Tanzanian shilling, especially if external pressures (e.g., global commodity prices or import costs) are affecting liquidity. In 2024, Tanzania’s inflation was reported around 3–4%, within the Bank’s target, so this reduction may reflect deliberate policy to maintain price stability.

3. Rising Inventories Point to Currency or Reserve Build-Up

• Inventories:
  • April 2025: TZS 840,111,691
  • March 2025: TZS 698,676,255
  • Change: Increase of TZS 141,435,436 (+20.24%)
• Economic Implication:
  • The 20.24% rise in inventories, likely currency stocks or precious metals, suggests preparation for increased currency circulation or reserve strengthening. This could be in response to anticipated economic activity, such as seasonal agricultural exports (e.g., cashew or coffee) or tourism inflows, which are key to Tanzania’s economy.
  • Alternatively, it may reflect precautionary measures to ensure currency availability amid potential supply chain or economic disruptions.

4. Stable Foreign Reserves Amid Global Pressures

• Foreign Currency Marketable Securities:
  • April 2025: TZS 8,790,819,501
  • March 2025: TZS 8,978,815,336
  • Change: Decrease of TZS 187,995,835 (-2.09%)
• Gold:
  • April 2025: TZS 104,372,142
  • March 2025: TZS 96,633,290
  • Change: Increase of TZS 7,738,852 (+8.01%)
• Holdings of Special Drawing Rights (SDRs):
  • April 2025: TZS 14,696,637
  • March 2025: TZS 14,250,237
  • Change: Increase of TZS 446,400 (+3.13%)
• Economic Implication:
  • The slight 2.09% decline in foreign currency securities, contrasted with an 8.01% rise in gold and 3.13% in SDRs, suggests a stable but cautious approach to foreign reserves. Tanzania’s foreign exchange reserves are critical for import cover (e.g., fuel, machinery) and debt servicing.
  • The increase in gold holdings may reflect a hedge against global economic uncertainty or rising gold prices, which have been trending upward globally in 2024–2025. The Bank’s reserves appear sufficient to maintain the shilling’s stability, as Tanzania’s import cover was reported at around 4–5 months in late 2024, above the regional benchmark of 4 months.

5. Controlled Currency Circulation Indicates Monetary Stability

• Currency in Circulation:
  • April 2025: TZS 8,140,182,041
  • March 2025: TZS 8,169,936,634
  • Change: Decrease of TZS 29,754,593 (-0.36%)
• Economic Implication:
  • The marginal 0.36% decrease in currency in circulation suggests controlled money supply growth, aligning with the Bank’s efforts to manage inflation. This is consistent with Tanzania’s low and stable inflation environment (3–4% in 2024), supported by prudent monetary policy and agricultural output.
  • It may also reflect a shift toward digital payments, as Tanzania has been promoting financial inclusion and mobile money platforms, reducing reliance on physical currency.

6. Increased Deposits Reflect Banking Sector Confidence

• Deposits - Banks and Non-Bank Financial Institutions:
  • April 2025: TZS 3,736,660,067
  • March 2025: TZS 3,612,551,132
  • Change: Increase of TZS 124,108,935 (+3.44%)
• Economic Implication:
  • The 3.44% rise in deposits from financial institutions indicates growing confidence in the banking sector and central bank. This could reflect increased liquidity in commercial banks, possibly driven by economic growth in sectors like mining, tourism, or agriculture.
  • Tanzania’s GDP growth was projected at 5.5–6% for 2025 by the IMF, driven by these sectors, so higher deposits align with economic expansion and financial system stability.

7. Sharp Rise in Other Liabilities Raises Questions

• Other Liabilities:
  • April 2025: TZS 324,413,464
  • March 2025: TZS 198,279,791
  • Change: Increase of TZS 126,133,673 (+63.60%)
• Economic Implication:
  • The 63.60% surge in other liabilities is notable and may indicate new obligations, such as operational costs, policy-related expenses, or pending payments. Without further detail, this could signal temporary fiscal pressures or one-off commitments.
  • If related to government support or debt management, it may warrant monitoring to ensure it doesn’t strain the Bank’s balance sheet.

8. Strengthened Equity Bolsters Financial Resilience

• Total Equity:
  • April 2025: TZS 2,987,283,005
  • March 2025: TZS 2,813,895,536
  • Change: Increase of TZS 173,387,469 (+6.16%)
• Reserves:
  • April 2025: TZS 2,887,283,005
  • March 2025: TZS 2,713,895,536
  • Change: Increase of TZS 173,387,469 (+6.39%)
• Economic Implication:
  • The 6.16% increase in equity, driven by a 6.39% rise in reserves, strengthens the Bank’s capital base, enhancing its ability to absorb economic shocks. This could result from retained earnings, revaluation gains (e.g., gold or foreign assets), or prudent financial management.
  • A stronger central bank balance sheet supports Tanzania’s economic stability, providing confidence to investors and creditors, especially as the country seeks to attract foreign investment in energy and mining.

Broader Economic Context and Implications

1. Fiscal Policy and Government Borrowing:
   • The 18.16% increase in advances to governments highlights the central bank’s role in financing public spending. While this supports development goals, it may raise concerns about fiscal sustainability if government borrowing grows without corresponding revenue increases. Tanzania’s public debt was around 40% of GDP in 2024, considered manageable, but monitoring is needed to avoid crowding out private sector credit.
2. Monetary Policy and Inflation Control:
   • The slight reduction in currency in circulation (-0.36%) and liquidity (-11.43%) suggests the Bank of Tanzania is maintaining tight control over money supply to keep inflation within its 3–5% target. This is critical as global inflationary pressures (e.g., energy and food prices) could challenge Tanzania’s price stability in 2025.
3. Foreign Exchange and External Resilience:
   • Stable foreign reserves, with a slight shift toward gold (+8.01%) and SDRs (+3.13%), indicate resilience against external shocks. Tanzania’s trade balance, driven by gold and agricultural exports, likely supports reserve adequacy. However, the 2.09% drop in foreign currency securities may reflect strategic sales to fund imports or debt payments.
4. Economic Growth and Financial Sector:
   • The 3.44% rise in bank deposits and 6.16% equity growth signal a robust financial sector and economic optimism. Tanzania’s projected 5.5–6% GDP growth in 2025, driven by mining (gold, critical minerals), tourism, and agriculture, aligns with these trends. The central bank’s strengthened position supports investor confidence.
5. Potential Risks:
   • The 63.60% increase in other liabilities is a red flag, as it could indicate unforeseen costs or obligations. If persistent, it may strain the Bank’s financial position.
   • Heavy reliance on government lending (21.11% of assets) could pose risks if fiscal revenues underperform, especially if global economic conditions worsen.

Conclusion

The Bank of Tanzania’s balance sheet as of April 30, 2025, reflects a stable but active economic environment. Key updates include increased government financing (+18.16%), reduced liquidity (-11.43%), and a build-up of inventories (+20.24%), suggesting fiscal support and monetary caution. Stable foreign reserves and a stronger equity position (+6.16%) indicate resilience, supporting Tanzania’s projected 5.5–6% GDP growth in 2025. However, the sharp rise in other liabilities (+63.60%) warrants scrutiny to ensure long-term stability. These trends align with Tanzania’s focus on development, inflation control, and financial sector growth, but careful management of fiscal and monetary policies will be crucial to sustain this trajectory.

Below is a table summarizing the key figures from the Bank of Tanzania’s Statement of Financial Position as of April 30, 2025, compared to March 31, 2025, with changes and percentage changes calculated. The table focuses on the most significant items driving economic insights, as discussed previously, to provide a clear overview of Tanzania’s economic updates. All amounts are in Tanzanian Shillings (TZS) thousands.

Notes on the Table

Economic Context:

1. The 18.16% increase in advances to governments (+TZS 865,221,907) underscores significant fiscal support, likely for development projects.
2. The 11.43% drop in cash and equivalents (-TZS 664,296,577) suggests active liquidity management to control inflation or fund lending.
3. The 20.24% rise in inventories (+TZS 141,435,436) indicates preparation for increased economic activity or currency demand.
4. Stable foreign reserves (e.g., gold +8.01%, SDRs +3.13%) support external resilience, despite a 2.09% decline in securities.
5. The 63.60% surge in other liabilities (+TZS 126,133,673) is a potential concern, warranting further scrutiny.
6. The 6.16% equity growth (+TZS 173,387,469) strengthens the Bank’s ability to support Tanzania’s 5.5–6% projected GDP growth in 2025.

In March 2025, the Tanzania Shilling showed signs of short-term depreciation, yet maintained overall stability, supported by effective interventions from the Bank of Tanzania. The average exchange rate weakened to TZS 2,650.24 per USD from TZS 2,492.05 in February 2025, reflecting a 6.3% monthly depreciation and an annual depreciation of 3.4%. To manage this pressure, the central bank sold USD 62.3 million in the foreign exchange market, up sharply from USD 24.4 million in the previous month. Meanwhile, gross official reserves rose to USD 5.7 billion, enough to cover 4.6 months of imports, exceeding both the national (4.0 months) and EAC (4.5 months) benchmarks. Despite currency pressures, inflation remained contained at 5.1%, staying within the national target and highlighting the strength of macroeconomic policy coordination.

Tanzania Shilling Stability: Analysis with Figures

Exchange Rate Trends

• In March 2025, the Tanzania Shilling traded at an average rate of TZS 2,650.24 per US dollar, showing a monthly depreciation from TZS 2,492.05 in February 2025.
• This represents a monthly depreciation of approximately 6.3%, and an annual depreciation of 3.4%, compared to a 2.2% appreciation in February 2024.

Foreign Exchange Market Interventions

• The Interbank Foreign Exchange Market (IFEM) experienced liquidity constraints, mainly due to seasonal declines in forex inflows from tourism and cash crop exports.
• To stabilize the shilling, the Bank of Tanzania intervened by selling USD 62.3 million in March 2025, compared to only USD 24.4 million in February 2025.
• Total IFEM transactions rose to USD 70.1 million, up from USD 24.4 million in February but down from USD 86.8 million in March 2024.

Foreign Exchange Reserves

• Gross official reserves increased to USD 5,693.2 million at the end of March 2025 from USD 5,327.1 million in March 2024.
• This level of reserves is enough to cover 4.6 months of projected imports, exceeding both the national benchmark (4.0 months) and EAC benchmark (4.5 months).

Inflation Context

• Headline inflation in March 2025 was recorded at 5.1%, slightly higher than 4.8% in February.
• Despite the currency depreciation, inflation has remained within the national and EAC target levels, indicating controlled domestic price pressures.

Interpretation

The Tanzania Shilling has experienced moderate depreciation against the US dollar, but this has been effectively managed by the Bank of Tanzania through:

• Active forex market interventions,
• Adequate reserve levels, and
• Maintaining stable inflation.

Table: Indicators of Tanzania Shilling Stability (March 2025)

*Approximate value based on annual depreciation rate.
MoM = Month-on-Month, YoY = Year-on-Year.

This table shows that despite some pressure on the shilling, monetary policy measures and foreign reserves have helped maintain its overall stability in the short term.

Key Insights

1. Moderate Depreciation, But Under Control

• The Tanzania shilling depreciated from TZS 2,492.05 to TZS 2,650.24 per USD in one month—a 6.3% fall.
• Over the past year, the currency has weakened by 3.4%.
• This depreciation was expected due to seasonal drops in foreign exchange inflows (like tourism and cash crop exports).

2. Effective Central Bank Intervention

• To limit excessive volatility, the Bank of Tanzania sold USD 62.3 million in the foreign exchange market.
• This is a significant increase from USD 24.4 million in February, showing active efforts to stabilize the shilling.

3. Strong Foreign Reserves Support Stability

• Reserves rose to USD 5.7 billion, enough to cover 4.6 months of imports.
• This exceeds the national benchmark (4.0 months) and EAC requirement (4.5 months).
• High reserves give the central bank the power to defend the currency if needed.

4. Stable Inflation Despite FX Pressure

• Even with the depreciation, inflation stayed at 5.1%, within the national target.
• This shows that the depreciation has not triggered runaway price increases, indicating good policy coordination.

Conclusion

The Tanzania Shilling faced short-term depreciation pressures in March 2025, but remained broadly stable due to effective central bank action, healthy foreign reserves, and contained inflation. This reflects a resilient and well-managed financial system, capable of absorbing external shocks while supporting economic stability.

As of March 2025, Tanzania’s domestic debt reached TZS 34,255.4 billion, reflecting a modest increase from TZS 34,014.1 billion in February, largely due to net Treasury bond issuances amounting to TZS 163.5 billion. The largest share of the debt was held by commercial banks, amounting to TZS 9,948.4 billion (29%), followed closely by pension funds with TZS 9,091.5 billion (26.5%), and the Bank of Tanzania holding TZS 6,883.9 billion (20.1%). Other significant creditors included insurance companies (5.4%), BOT special funds (1.6%), and a diverse group of public institutions, individuals, and others (17.3%). This composition highlights a stable and diversified domestic financing structure, with key institutional investors playing a central role in funding government operations.

1. Government Domestic Debt Stock (March 2025)

• Total domestic debt: TZS 34,255.4 billion, a slight increase from TZS 34,014.1 billion in February 2025.
• The increase was primarily due to the issuance of Treasury bonds, adding TZS 163.5 billion in net terms.
• Treasury bonds remained the dominant borrowing instrument, accounting for 79.5% of the government securities portfolio.

2. Domestic Debt by Creditor Category (March 2025)

*Others include public institutions, private companies, and individuals.

Interpretation: What the Data Tells Us

1. Commercial banks remain the leading creditors, holding 29% of the domestic debt. This suggests strong financial sector participation in government financing.
2. Pension funds (26.5%) and the Bank of Tanzania (20.1%) also play key roles, providing long-term and stabilizing sources of funding.
3. The “Others” category (17.3%) shows growing participation from smaller institutions and individuals, indicating increasing financial market inclusiveness.

As of March 2025, Tanzania's government domestic debt stood at TZS 34.26 trillion, with commercial banks, pension funds, and the central bank as the main creditors. The composition reflects a stable and diversified domestic debt market, supporting the government's financing needs through long-term and market-based instruments.

What the Data Tells Us

1. Domestic Financing Is Heavily Market-Based

• Commercial banks are the largest creditors, holding TZS 9.95 trillion or 29% of domestic debt.
• This indicates that banks play a major role in financing the government through instruments like Treasury bills and bonds.

This shows: The government relies significantly on the financial sector for short- to medium-term funding, which can influence interest rates and credit availability for the private sector.

2. Pension Funds Are Strategic Long-Term Lenders

• Pension funds hold 26.5% (TZS 9.1 trillion) of the debt.
• This reflects a long-term and stable investment relationship, as pension funds often prefer secure, fixed-income government securities.

This shows: A strong link between public savings (retirement funds) and government financing, supporting fiscal stability over time.

3. The Bank of Tanzania Supports Liquidity and Stability

• The central bank itself holds TZS 6.88 trillion or 20.1% of domestic debt.
• This is typical in monetary policy operations and may include direct purchases of government securities to ensure liquidity or support policy goals.

This shows: The BoT acts as a fiscal backstop, helping manage cash flow needs and stabilize the bond market.

4. Broadening Participation in Domestic Debt Market

• The “Others” category (17.3%), including private institutions and individuals, shows growing inclusion in the debt market.

This shows: The domestic debt market is maturing, becoming more inclusive and diversified, which reduces overreliance on any single creditor group.

Conclusion

Tanzania’s domestic debt structure as of March 2025 reveals a healthy mix of commercial banks, pension funds, and the central bank as major creditors, supported by increasing participation from other entities. This structure reflects a stable and increasingly diversified domestic financing base, essential for sustainable debt management and macroeconomic stability.

As of March 2025, Tanzania’s total external debt stood at USD 34.06 billion, with the central government accounting for 78.3% (USD 26.67 billion), reflecting the public sector’s dominant role in external borrowing. The private sector held USD 7.38 billion (21.7%), of which USD 1.28 billion represented interest arrears. Disbursed funds were largely directed toward transport and telecommunication (21.3%), budget and balance of payments support (20.6%), and social welfare and education (20.1%), highlighting the government’s investment in infrastructure and social sectors. In terms of currency composition, the debt stock was heavily denominated in US dollars (67.7%), followed by the Euro (16.7%) and Chinese Yuan (6.3%), exposing the country to significant exchange rate risk. These figures underscore Tanzania’s strategy of development-oriented borrowing, while also signaling the need for prudent foreign currency risk management.

1. External Debt Stock by Borrowers (March 2025)

Insight: Public sector dominates Tanzania’s external debt, with over three-quarters owed by the central government.

2. Disbursed Outstanding Debt by Use of Funds (March 2025)

Insight: The top three sectors—Transport & Telecom (21.3%), Social Welfare & Education (20.1%), and BoP/Budget Support (20.6%)—account for over 62% of debt usage, showing focus on infrastructure and public services.

3. Debt by Currency Composition (March 2025)

Insight: The US dollar continues to dominate, making up over two-thirds of external debt. This exposes the debt profile to USD exchange rate risk.

As of March 2025, Tanzania’s external debt totaled USD 34.06 billion, with the central government accounting for 78.3%. Debt usage was primarily focused on infrastructure, public services, and budget support. The portfolio is heavily denominated in USD (67.7%), signaling potential currency exposure risk that needs active management.

Key Insights:

1. Debt Is Primarily Public and Government-Controlled

• 78.3% of total external debt (USD 26.7 billion) is owed by the central government.
• The private sector holds only 21.7%, with some of it (USD 1.28 billion) in interest arrears.

This shows: Tanzania’s external debt is mainly public, which gives the government control over how funds are allocated and managed, but also increases fiscal responsibility and repayment risk for the state.

2. Debt Is Focused on Development Priorities

• The largest shares of disbursed debt were used for:
  • Transport & Telecom (21.3%)
  • Budget Support & BoP (20.6%)
  • Social Welfare & Education (20.1%)
  • Energy & Mining (13.5%)

This shows: Borrowed funds are being directed towards infrastructure, public services, and economic growth sectors, which are critical for long-term development.

3. High Exposure to the US Dollar

• 67.7% of the debt stock is denominated in USD, with only 16.7% in EUR and 6.3% in Chinese Yuan (CNY).

This shows: Tanzania is highly exposed to USD fluctuations, meaning if the US dollar strengthens, the cost of servicing the debt increases in local currency (TZS). This is a key exchange rate risk.

Conclusion

The data indicates that Tanzania’s external debt is heavily concentrated in the central government, used for productive sectors like infrastructure and social services. However, the large share in USD poses a currency risk, making it important for Tanzania to maintain foreign reserves and export earnings to cushion against global shocks.

In March 2025, Tanzania’s central government collected a total of TZS 2,465.8 billion in revenue, which was 98.9% of the monthly target. Of this, TZS 2,387.5 billion came from the central government, including TZS 2,055.2 billion in tax revenue—driven by income taxes (TZS 676.1 billion), taxes on imports (TZS 755.3 billion), and local goods and services (TZS 490.6 billion). Non-tax revenue reached TZS 332.3 billion, meeting 99.4% of its target. On the expenditure side, the government spent TZS 3,658.3 billion, with TZS 2,372.0 billion allocated to recurrent expenses—including TZS 937.6 billion for wages and salaries—and TZS 1,286.3 billion for development projects. This spending reflects the government's commitment to public service delivery and infrastructure investment, despite operating a short-term fiscal gap of over TZS 1.19 trillion.

1. Central Government Revenue (March 2025)

• Total revenue collected: TZS 2,465.8 billion, which was just 1.1% below the target.
• Central government share: TZS 2,387.5 billion, which is 96.8% of total revenue.
• Target: TZS 2,390.1 billion, indicating near-target performance.
• Breakdown:
  • Tax revenue: TZS 2,055.2 billion (met the monthly target)
    • Income tax: TZS 676.1 billion
    • Taxes on local goods and services: TZS 490.6 billion
    • Taxes on imports: TZS 755.3 billion
    • Other taxes: TZS 133.2 billion
  • Non-tax revenue: TZS 332.3 billion vs. target of TZS 334.4 billion (99.4%)

Revenue performance remains strong, supported by tax administration improvements and steady economic activity.

2. Central Government Expenditure (March 2025)

• Total spending: TZS 3,658.3 billion
  • Recurrent expenditure: TZS 2,372.0 billion
    • Wages and salaries: TZS 937.6 billion
    • Interest payments: TZS 366.4 billion (Domestic: TZS 240.2 billion, Foreign: TZS 126.2 billion)
    • Other recurrent expenses: TZS 1,068.0 billion
  • Development expenditure: TZS 1,286.3 billion (Target exceeded slightly)

The government maintained a fiscal discipline approach, focusing on key social services and infrastructure despite a slight revenue shortfall.

Summary Table: Government Budget Operations (March 2025)

In March 2025, Tanzania’s central government demonstrated strong revenue performance, collecting over TZS 2.4 trillion, primarily through taxes. Despite revenue being slightly below target, government expenditure reached TZS 3.7 trillion, focusing on development and essential services, supported by prudent fiscal management.

Key Takeaways

1. trong Revenue Performance

• The government collected TZS 2,465.8 billion, just 1.1% below target, showing strong tax collection efficiency.
• Tax revenue (TZS 2,055.2 billion) hit its target, indicating:
  • Good tax administration,
  • Broadening tax base,
  • Resilient economic activity.
• Non-tax revenue (TZS 332.3 billion) also performed well at 99.4% of target, reflecting enhanced collection from fees, licenses, and dividends.

What it tells: The revenue system is functioning effectively, even under economic pressure.

2. High Government Spending

• Total expenditure reached TZS 3,658.3 billion, led by:
  • Recurrent spending: TZS 2,372.0 billion (65%) — covering wages and essential services.
  • Development spending: TZS 1,286.3 billion (35%) — invested in infrastructure, education, and health.

What it tells: The government is committed to balancing service delivery and long-term development, even if it means running a short-term fiscal deficit.

3. Fiscal Gap Suggests Borrowing

• With revenue at TZS 2.5 trillion and spending at TZS 3.7 trillion, there's a fiscal gap of about TZS 1.2 trillion.
• This likely requires borrowing (domestic and/or external) to bridge the deficit.

What it tells: The fiscal policy is slightly expansionary, prioritizing development, but managed under a disciplined framework.

Conclusion

The March 2025 budget performance shows a resilient fiscal system, with strong revenue collection and strategic spending priorities. Although the government is spending more than it earns in the short term, this is controlled and focused on growth-oriented sectors, supported by good tax performance and financial management.

In March 2025, Tanzania’s financial system experienced a moderate tightening in borrowing conditions, with the overall lending rate rising to 15.50%, up from 15.14% in February 2025. Short-term loans (up to 1 year) averaged 15.83%, while medium-term loans (1–3 years) rose above 16%, reflecting higher credit risk pricing. In contrast, negotiated lending rates for prime borrowers declined to 12.94% from 13.42%, indicating competitive conditions for low-risk clients. On the deposit side, returns eased due to improved liquidity, with the 12-month deposit rate dropping sharply to 8.14% from 9.48%, and the negotiated deposit rate falling to 10.35% from 11.40%. Consequently, the interest rate spread widened to 7.69 percentage points, compared to 6.29 points in February, highlighting growing bank profit margins and a cautious credit outlook.

1. Lending Interest Rates (TZS Loans)

Interpretation: Lending rates rose slightly across most loan durations in March 2025, reflecting cautious pricing due to liquidity costs and credit risk. However, negotiated rates (for prime borrowers) declined, indicating banks' willingness to offer competitive rates to low-risk clients.

2. Deposit Interest Rates (TZS Deposits)

Interpretation: Deposit rates declined slightly, particularly the 12-month and negotiated deposit rates, due to improved liquidity conditions in the banking system, reducing banks' need to compete for deposits.

3. Short-Term Interest Rate Spread

• The interest rate spread (difference between short-term lending and deposit rates) widened to 7.69 percentage points in March 2025, from 6.29 in February and 7.23 in March 2024.

Implication: A widening spread suggests improved bank profitability on new lending, but may also imply tighter borrowing conditions for depositors.

In March 2025, lending interest rates slightly increased, while deposit rates softened due to ample liquidity. The negotiated lending rate dropped to 12.94%, showing room for favorable terms for low-risk borrowers. These trends reflect active monetary management and a stable credit environment.

What the Figures Tell Us

1. Borrowing Costs Are Slightly Rising

• The overall lending rate increased from 15.14% in February to 15.50% in March 2025.
• Rates for short- and medium-term loans also rose.
• 👉 This suggests that banks are charging more for credit, possibly due to:
  • Inflation expectations,
  • Higher demand for credit,
  • Or cautious risk pricing.

2. Preferred (Low-Risk) Borrowers Still Get Better Deals

• The negotiated lending rate fell from 13.42% to 12.94%.
• 👉 This means banks are competing more for large or safe borrowers, such as corporates or government clients, by offering lower rates.

3. Depositors Are Getting Lower Returns

• Deposit rates fell slightly:
  • 12-month deposit rate dropped from 9.48% to 8.14%.
  • Negotiated deposit rate declined from 11.40% to 10.35%.
• 👉 This indicates that banks are less pressured to attract new deposits, thanks to improved liquidity in the system.

4. Wider Interest Rate Spread = Higher Bank Profit Margins

• The interest rate spread (gap between lending and deposit rates) increased to 7.69% in March from 6.29% in February.
• 👉 A higher spread often means better margins for banks, but it also signals higher borrowing costs for the public compared to the returns they earn from savings.

Overall Interpretation

The data shows a stable but cautious banking environment in Tanzania. Banks are raising lending rates slightly to manage risks and inflation, while lowering deposit rates as liquidity improves. However, prime borrowers still enjoy favorable terms, and banks are earning more from the gap between what they pay and what they charge.