The global trade outlook for 2025 has sharply deteriorated following the announcement and partial implementation of new US "reciprocal tariffs," often referred to as Trump tariffs. According to the WTO's Global Trade Outlook and Statistics 2025, the volume of world merchandise trade is now projected to contract by -0.2% in 2025, a stark reversal from the +2.9% growth seen in 2024. If trade policy uncertainty spreads further, the decline could deepen to -1.5%. Global GDP growth at market exchange rates is also expected to slow, falling from 2.8% in 2024 to 2.2% in 2025. North America will experience the heaviest losses, dragging global trade growth down by -1.7 percentage points, while Asia’s contribution to global trade growth is expected to shrink by half to +0.6 percentage points. Services trade, though less directly affected by tariffs, will also slow, with projected growth declining from 6.8% in 2024 to 4.0% in 2025. Despite the challenging environment, least-developed countries (LDCs) could see their merchandise export volume rise by 4.8%, benefiting from trade diversion effects as US importers seek alternatives to Chinese goods.

1. Global Trade Growth

• Merchandise Trade (goods):
  • 2024: +2.9% growth (volume).
  • 2025 (forecast): -0.2% contraction (due to new tariffs and trade policy uncertainty).
  • 2026 (forecast): +2.5% recovery.
• Commercial Services Trade:
  • 2024: +6.8% growth (volume).
  • 2025 (forecast): +4.0% growth.
  • 2026 (forecast): +4.1% growth.

2. Trade in Value Terms

• World Merchandise Exports (2024): US$ 24.43 trillion (+2% value growth).
• World Commercial Services Exports (2024): US$ 8.69 trillion (+9% value growth).

3. Leading Traders (2024)

• Top Merchandise Exporter: China (US$ 3.58 trillion).
• Top Merchandise Importer: USA (US$ 3.36 trillion).
• Top Services Exporter: USA (US$ 1.08 trillion).
• Top Services Importer: USA (US$ 787 billion).
• If counted as a single entity, EU had:
  • Exports: US$ 2.80 trillion (merchandise), US$ 1.64 trillion (services).
  • Imports: US$ 2.63 trillion (merchandise), US$ 1.44 trillion (services).

4. Regional Impact on Trade (2025 Forecast)

5. Risks to the Forecast

• If US reciprocal tariffs are reinstated → World trade could fall by an extra -0.6%.
• If trade policy uncertainty spreads → Another -0.8% cut.
• Combined → Trade may fall -1.5% in 2025.

6. Special Insights

• LDCs (Least-Developed Countries) may benefit from US-China trade tensions:
  • Their exports could grow by +4.8% in 2025 (adjusted forecast).
  • US seeks alternative suppliers for goods like textiles and electronics.

7. Global GDP Growth

• 2024: +2.8% growth.
• 2025 (forecast): +2.2% (adjusted down because of tariffs).
• 2026 (forecast): +2.4%.

8. Sector-Specific Services Growth (2025 Forecast)

9. Highlights from 2024 Performance

• Asia led transport service growth (+18%).
• Africa's travel exports grew +9%, led by countries like Tanzania (+19%).
• Computer services exports (e.g., AI, IT) grew +12% globally, reaching US$ 1 trillion.

Main Impacts of Trump Tariffs:

More Details:

• Trump Tariffs Structure:
  • +25% on many imports (especially cars, steel).
  • +145% extra on goods from China (excluding some electronics).
  • Reciprocal tariffs across all partners (except some exemptions)​.
• Trade Diversion:
  • Chinese exports drop 77% to the US.
  • Other Asian economies and LDCs like Bangladesh, Cambodia, and Lesotho benefit by supplying more to the US​.
• Regional Trade Shifts:
  • Asia ex-China gains some US market share.
  • Africa and LDCs modest gains in exports.
  • North America and Europe suffer from declining trade flows.

Trump Tariffs could cause a -1.5% fall in world merchandise trade, slow global GDP by -0.6%, severely hit North America, and create new export chances for some LDCs.

Global Trade and Economy Are Becoming More Fragile

• In early 2025, the world expected trade and economic growth to continue recovering after past shocks like COVID-19 and inflation.
• But new tariffs, especially the Trump "reciprocal tariffs", have reversed this outlook.

Main Messages:

1. Global trade will shrink in 2025.
   • Merchandise trade will contract by -0.2% (and -1.5% if more uncertainty spreads).
   • Services trade will grow more slowly.
2. North America will suffer the most.
   • Big drop in US and Canada trade and GDP.
   • They cause the biggest drag on world trade growth.
3. Asia and Europe stay positive but weaker.
   • Asia’s trade grows, but much slower.
   • Europe grows a little bit, not strong enough to save global trade.
4. Least-Developed Countries (LDCs) may benefit a little.
   • Some LDCs could sell more to the US as alternatives to China.
   • But they are still vulnerable if global uncertainty grows.
5. Global GDP will slow down.
   • From expected 2.8% growth to about 2.2% in 2025.
   • Trade and economic policies are now major risks for growth.
6. The Trump Tariffs are disruptive.
   • They don’t just hurt US-China trade.
   • They shake global supply chains, cause trade diversion, and hurt overall confidence.
   • Even services (like shipping, travel, IT) are impacted.

In Short:

The world economy in 2025 looks weaker than expected because of new US tariffs. Trade will shrink, growth will slow, and the risks of more disruption are high. Some poor countries might gain opportunities, but the overall environment is more uncertain and fragile.

The introduction of new US reciprocal tariffs in 2025, often referred to as Trump tariffs, is reshaping global trade patterns, creating mixed impacts for Africa and Tanzania. According to the WTO Global Trade Outlook and Statistics 2025, Africa’s merchandise exports are expected to grow by +0.6% in 2025, slightly higher than previous forecasts, as US buyers seek new suppliers outside China. Least-developed countries, including Tanzania, are projected to benefit from this trade diversion, with export growth for LDCs rising to +4.8%. However, Africa’s services exports, which include key sectors like transport and tourism, are expected to contract by -1.6%, reversing earlier positive expectations. For Tanzania, opportunities lie in expanding agricultural, textile, and gold exports, but risks remain in its tourism and logistics sectors. Despite these challenges, Africa's overall GDP impact is minimal, with projected growth hovering around 0.0% change, reflecting resilience but also vulnerability to further global trade uncertainties.

Africa - Overall Trade Outlook 2025

• Africa’s Merchandise Exports (2025 forecast):
  • Growth: +0.6% (adjusted, after tariffs and uncertainty).
  • 2024 growth was +1.3%.
• Africa’s Merchandise Imports:
  • 2025 forecast: +6.5% growth.
  • Strong import recovery after a slow 2024 (+1.8%).
• Africa’s Services Exports:
  • 2025 baseline forecast was +1.8%.
  • Adjusted forecast: -1.6% decline (due to global uncertainty).
• Impact on Africa’s GDP:
  • 2025 GDP growth is forecast to slow by -0.04% to flat 0.0% growth​.
  • This indicates a mild but noticeable slowdown.

Tanzania Specific Points

• Tanzania is not individually highlighted among Africa's top 10 traders in the WTO report.
• However, based on the region-wide Africa performance and Tanzania's recent growth patterns:
  • Tanzania’s exports (goods and services) are likely to grow modestly, mainly due to opportunities in agriculture, gold, tourism, and digitally delivered services.
  • Risks:
    • Weaker demand from Europe and China.
    • Rising competition from other LDCs benefiting from US-China trade diversions​.

Key Opportunity for Tanzania:
New US demand for textiles, agricultural products, and electronics substitutes from African countries could support +4% to +5% export growth if leveraged well​.

Top 10 African Countries (Trade Outlook 2025)

Note: Rankings based on 2024 export size and WTO forecasts​​.

Quick Figure Highlights:

• Africa's contribution to world trade growth: Only +0.4 percentage points in 2025​.
• Africa’s share in digitally delivered services exports: 0.9% in 2024, slowly rising​.
• Overall world trade contraction: -0.2% (2025).

"Africa’s trade will show mixed results in 2025, with strong import growth but only modest export recovery. Tanzania could benefit from shifts in global trade, but services exports will remain vulnerable."

Impact of Trump Tariffs on Africa (Including Tanzania)

Impact on Tanzania Specifically

• Export Opportunities:
  • Tanzania could gain market access in the US for textiles, garments, agriculture as US buyers look for alternatives to Chinese goods​.
  • Strong sectors: gold exports, horticulture, and tourism recovery.
• Risks:
  • Services sector (tourism, logistics) could suffer because of lower global travel demand: services exports expected to fall -1.6% for Africa, including Tanzania​.
  • Logistics costs may increase (higher shipping costs), which could hurt exporters' competitiveness.
• GDP Impact:
  • Tanzania’s GDP growth impact is very minor (similar to Africa average at 0.0% to slight negative).
  • If global uncertainty spreads more, Tanzania's exports could slow more sharply in late 2025.

Short Conclusion:

"Trump tariffs could offer Tanzania a chance to expand goods exports, especially to the US, but services like tourism and shipping face a slowdown. Overall, Africa will see modest export gains but services sector pain."

As Tanzania continues its journey toward economic self-reliance, the performance of the Tanzania Revenue Authority (TRA) has taken center stage in the country’s budget operations. With consistent improvements in tax collection and administrative reforms, TRA is emerging as the main engine of domestic revenue mobilization. But the key question remains: Can TRA revenues fully support Tanzania’s budget and eliminate the fiscal deficit?

TRA’s Strong Performance: Numbers Speak

From July 2024 to March 2025, TRA collected TZS 24.05 trillion, exceeding the target of TZS 23.21 trillion by TZS 0.84 trillion. This represents a performance rate of 103.62% and a 17% increase compared to the same period in 2023/24.

Projection: By June 2025, TRA is expected to collect over TZS 32 trillion, positioning it to potentially cover most of Tanzania’s recurrent budget.

In comparison, Tanzania typically receives about TZS 7–8 trillion annually in foreign aid and loans. TRA’s revenue is now 4–5 times greater, proving the growing power of domestic resource mobilization.

January 2025 Snapshot: TRA’s Role in Budget Execution

A closer look at January 2025 reveals the real weight of TRA revenues:

• Total Government Revenue: TZS 2,697.8 billion
• TRA Tax Revenue (part of above): TZS 2,222.3 billion
• Total Government Expenditure: TZS 3,576.1 billion

➤ Resulting Budget Deficit:

Deficit = Expenditure – Revenue
= TZS 3,576.1B – TZS 2,697.8B
= TZS 878.3 billion

Even though TRA slightly exceeded its tax collection target by 0.3%, it could not fully cover government spending. This left a financing gap of TZS 878.3 billion, highlighting ongoing fiscal pressure.

Can TRA Close the Budget Gap?

TRA’s improved performance is helping reduce the budget deficit. For example:

• In Q3 (Jan–Mar 2025), TRA overcollected by TZS 100 billion.
• If this overperformance continues each quarter, it would amount to TZS 400–500 billion annually.
• This could reduce the budget deficit by 50% or more.

Still, to completely eliminate the deficit, either:

• Expenditure must be reduced, or
• Other revenues (like non-tax income or grants) must fill the remaining gap.

From Deficit to Surplus — What’s Required?

Let’s do the math:

• Annual Government Expenditure Estimate (FY 2024/25): TZS 38–40 trillion
• Projected TRA Revenue: TZS 32 trillion
• Remaining gap: TZS 6–8 trillion

So even with TRA’s strong performance, Tanzania still faces a potential shortfall of TZS 6–8 trillion annually, unless:

• Development expenditure is strategically reduced,
• Non-tax revenues improve (e.g., state dividends, fees),
• Or external financing is maintained temporarily.

Only when total revenue exceeds expenditure will Tanzania begin to see a budget surplus.

Key Takeaways

TRA Is Leading, But Not Alone

The Tanzania Revenue Authority has undeniably become the pillar of fiscal sustainability. Its strong revenue performance is reducing Tanzania’s dependence on foreign aid and increasing its ability to fund development locally.

But as January’s numbers show, TRA alone is not yet enough to balance the budget. A comprehensive approach — combining efficient spending, improved non-tax revenues, and sustained tax reforms — is essential.

With smart fiscal management and continued TRA performance, Tanzania can achieve true budget independence — and perhaps, a future surplus.

Tanzania Budget Operations vs TRA Revenue

Summary Insights from the Table

• TRA is Tanzania’s main source of domestic financing, contributing over 80% of total monthly revenues and consistently exceeding targets.
• Despite this strength, budget deficits persist due to high recurrent and development spending.
• If current TRA performance continues, it could reduce the deficit by half, but a surplus requires more than just tax revenue — it needs:
  • Better non-tax revenue collection
  • Spending controls
  • Efficient use of resources

As of March 2025, Tanzania recorded 65.7 million mobile money accounts, showing a significant increase from 29.8 million in 2020 — a growth of 120% over five years. In the first quarter of 2025 alone, accounts grew from 64.3 million in January to 65.7 million in March, adding 1.3 million new users. The market is led by M-Pesa with over 26 million accounts, followed by Mixx by Yas (20.2 million) and Airtel Money (12.1 million). Transaction volumes also surged, reaching 10.3 billion in 2024, up from 3.8 billion in 2020, reflecting a 172% increase. These trends highlight the critical role mobile money plays in Tanzania’s growing digital and inclusive economy.

1. Mobile Money Accounts — January to March 2025

What This Tells Us:

• Growth Trend:
  From January to March 2025, mobile money accounts increased by 1,335,129 (from 64.34M to 65.67M), showing continued growth in usage and access.
• Dominant Players:
  • M-Pesa (Vodacom) leads with over 26 million accounts (40% of total).
  • Mixx by Yas (formerly Tigo Pesa) holds steady at around 20.2 million accounts (31%).
  • Airtel Money is also strong, growing from 11.8M to 12.1M in Q1.
• Smallest Player:
  • Azam Pesa has fewer than 40,000 accounts — under 0.1% market share — indicating it is still in early stages or niche focused.
• Stability: T-Pesa (TTCL) maintained the same number of accounts across all three months (1.5 million), suggesting either stagnant growth or a stable, focused user base.

2. Mobile Money Subscriptions and Transactions (2020–2024)

What This Tells Us:

• Explosive 5-Year Growth:
  • Mobile money accounts grew by 111%, from 29.8M (2020) to 63.2M (2024).
  • Transactions more than doubled (172% increase), from 3.77B in 2020 to 10.27B in 2024.
• Year-by-Year Trends:
  • The biggest account growth occurred between 2022 and 2023, with an increase of nearly 13.4 million accounts — coinciding with the rollout of new digital services and network expansions.
  • Transactions followed a similar trend, especially between 2021 and 2024, where usage jumped significantly — suggesting increased trust and reliance on mobile money for daily transactions.
• Digital Financial Inclusion: These figures reflect Tanzania's success in expanding access to digital financial services, especially in rural and underserved areas. It highlights the role of mobile money in boosting economic participation, especially among the unbanked.

Key Takeaways

1. Mobile Money is Strong and Still Growing in 2025

• By March 2025, Tanzania had over 65.6 million mobile money accounts, up from 64.3 million in January — a growth of 1.3 million new accounts in just 3 months.
• This shows continued trust and adoption of mobile money platforms, especially for daily financial needs like sending, receiving, saving, and paying bills.

2. M-Pesa is the Market Leader, But Competition is Healthy

• M-Pesa (Vodacom) leads the market with over 26 million users, about 40% of all mobile money accounts.
• Mixx by Yas (formerly Tigo Pesa) follows with 20.2 million, and Airtel Money with 12.1 million.
• This indicates strong competition among providers, which is good for innovation, pricing, and service quality.

3. Massive 5-Year Growth in Financial Inclusion (2020–2024)

• Mobile money accounts grew by 111%: from 29.8 million in 2020 to 63.2 million in 2024.
• Mobile money transactions grew by 172%: from 3.77 billion in 2020 to 10.27 billion in 2024.
• This shows that mobile money has become a vital part of the economy, especially in reaching the unbanked population.

4. Mobile Money is Driving Tanzania’s Digital Economy

• The data proves that mobile money is no longer just a tool for sending money — it’s a foundation for digital commerce, savings, credit, and everyday transactions.
• As more people sign up and use mobile money, it helps expand financial access, improve service delivery, and boost economic inclusion, especially in rural areas.

As of March 2025, Tanzania recorded 49.3 million internet subscriptions, up from 48.6 million in January, reflecting a 1.57% growth in just one quarter. The majority — over 99% — are mobile wireless connections, highlighting Tanzania’s status as a mobile-first digital economy. Fixed wireless and fixed wired lines accounted for less than 1% combined. In terms of market share, Vodacom led with 34.0%, followed by Yas (30.4%) and Airtel (21.8%), showing strong competition among service providers. The steady growth and mobile dominance indicate increasing digital adoption, especially through smartphones.

1. Monthly Internet Usage (Subscriptions) — January to March 2025

What It Tells Us:

• Steady Growth: Internet subscriptions increased by 1.57% in one quarter — an addition of 764,110 users.
• Mobile Dominance: Mobile wireless accounts for over 99% of internet usage, indicating that mobile phones are the main access point to the internet in Tanzania.
• Fixed Internet (Wired & Wireless): While still small, both fixed wired and fixed wireless connections are slowly increasing — a sign of gradual infrastructure expansion for homes, offices, and institutions.
• Digital Inclusion: More Tanzanians are accessing internet services month-to-month, showing growing digital inclusion and demand for online services.

2. Share of Mobile Internet Subscriptions by Operator — March 2025

What It Tells Us:

• Vodacom Leads: Vodacom maintains a strong position with over one-third of the mobile internet market, indicating reliability, reach, and strong data packages.
• Yas Rising: Yas (formerly Tigo) is close behind, showing strong growth in user adoption and possibly competitive pricing or promotions.
• Airtel’s Solid Share: Airtel controls nearly 22% of the market, reinforcing its role as a major player.
• Smaller Players: Halotel and TTCL have smaller shares, but they play a crucial role in serving specific regions or customer segments.
• Market Diversity: The relatively even distribution among top three operators suggests healthy competition, which may lead to better service quality and pricing for users.

Key Insights from Internet Usage and Market Share

1. Tanzania is a Mobile-First Internet Market

• Over 99% of internet subscriptions come from mobile wireless connections.
• Only a small fraction (less than 1%) use fixed wireless or fixed broadband (like fiber).
• This shows that most Tanzanians access the internet through mobile phones, not desktop or home internet — a clear sign that mobile technology is driving digital inclusion.

2. Internet Adoption Is Growing Steadily

• Between January and March 2025, internet subscriptions grew from 48.57 million to 49.33 million, a rise of 764,110 users (+1.57% in one quarter).
• This steady growth suggests rising demand for internet services, likely due to:
  • Expansion of 4G/5G networks
  • Mobile money and online platforms
  • Social media usage and digital entertainment

3. Market Is Competitive, But Led by Key Players

• Vodacom leads the mobile internet market with 34.0% share — likely due to its wide coverage and stable service.
• Yas (30.4%) and Airtel (21.8%) are strong competitors, showing that users have multiple choices.
• Halotel (10.4%) and TTCL (3.4%) serve smaller niches, often in rural or institutional areas.
• The presence of multiple players encourages better service quality, innovation, and pricing — good news for consumers.

4. Fixed Internet Still Needs Investment

• Fixed wired and wireless subscriptions remain below 1%, meaning most homes and businesses still lack broadband access.
• This signals a need for:
  • Infrastructure development (fiber optics)
  • Government-private partnerships
  • Affordable fixed internet packages

Bottom Line

Tanzania's internet landscape is mobile-driven, growing steadily, and highly competitive. While access is expanding, the next step is to broaden fixed internet coverage and ensure rural areas are connected just like urban centers.

As of March 2025, Tanzania reached 90.4 million mobile subscriptions, marking a significant growth of 76.5% from 51.2 million in 2020. In the most recent quarter alone (Jan–Mar 2025), subscriptions increased by 4.1%, up from 86.8 million in December 2024. Fixed lines remain minimal, at just 0.09% of total subscriptions. Vodacom leads the mobile market with 31.7% share, followed by Yas (28.7%) and Airtel (22.9%). Gender distribution is almost equal, with 51% male and 49% female users, while Dar es Salaam accounts for 18% of the national total, with 16.6 million mobile lines.

Number of Mobile and Fixed Lines from January to March 2025

This table shows the monthly registration totals of mobile and fixed-line telephone subscriptions. Mobile lines dominate, accounting for over 99.9% of all subscriptions. There is consistent monthly growth, with a total increase of over 2.2 million new lines in the first quarter of 2025.

Share (%) of P2P Lines Registered by Each Operator (March 2025)

This table represents the market share of Person-to-Person (P2P) mobile lines by telecom operator. Vodacom leads the market, followed closely by Yas and Airtel. TTCL, primarily a fixed-line service provider, has a small market share in mobile.

Number of P2P Mobile Lines by Gender (March 2025)

Mobile phone ownership shows a nearly even gender distribution, with males slightly leading. This reflects relatively equal access to mobile services among Tanzanian men and women.

Quarterly Trend of Mobile Lines (2024–Q1 2025)

This quarterly trend shows rapid and steady growth in mobile subscriptions. From June 2024 to March 2025, Tanzania added approximately 13.8 million new mobile lines, indicating strong market penetration and mobile service adoption.

Annual Trend of Mobile Lines (2020–2024)

Over the five-year period, Tanzania saw nearly 70% growth in mobile subscriptions. The most significant increase occurred from 2022 to 2024, reflecting the effects of digital transformation, mobile money growth, and telecom competition.

Mobile Line Usage by Top 10 Regions (March 2025)

These figures reflect regional penetration of mobile communication services. Urbanized and economically vibrant regions like Dar es Salaam, Mwanza, and Arusha dominate due to high population density, better infrastructure, and business activity. This geographic concentration highlights opportunities for targeted telecom investments in less-served areas.

What It Tells Us:

1. Rapid Growth in Mobile Connectivity

• Mobile subscriptions grew from 86.8 million in Dec 2024 to 90.3 million by March 2025, a 4.1% increase in just one quarter.
• This shows a very high demand for mobile communication, likely driven by affordable services, mobile money, and digital adoption.

2. Fixed Lines Are Nearly Obsolete

• Only around 79,000 fixed lines exist, compared to 90 million mobile lines.
• Fixed lines represent less than 0.1% of all lines, confirming that mobile is the dominant telecom platform in Tanzania.

3. Fair Gender Access

• Males (51%) and females (49%) own mobile lines in almost equal measure.
• This suggests equitable access to mobile services, an important sign for digital inclusion efforts.

4. Intense Competition Among Mobile Operators

• Vodacom (31.7%), Yas (28.7%), and Airtel (22.9%) dominate the market.
• Yas (formerly Tigo) has grown significantly, overtaking Airtel.
• This competitive environment may drive better pricing, services, and innovation.

5. Strong Urban and Regional Disparities

• Dar es Salaam alone has over 16 million lines, nearly 18% of all lines in the country.
• Other urban centers like Mwanza, Arusha, and Mbeya also show high numbers.
• It reveals urban dominance, but also shows where rural telecom investments could grow.

6. Consistent Year-on-Year Growth

• Mobile lines grew from 51 million in 2020 to over 90 million in 2025 — a 76% increase in 5 years.
• Tanzania is catching up fast with global connectivity trends, especially in mobile-first economies.

Policy & Business Implications

• For the government: there's an opportunity to close rural and digital gender gaps.
• For businesses: there's a growing, competitive, and increasingly inclusive market for mobile services.
• For investors: Tanzania’s telecom sector shows strong growth potential with room for infrastructure and digital service expansion.

In 2024, global debt surged to an alarming USD 250 trillion, equal to 237% of global GDP, as reported by the IMF’s 2024 Global Debt Monitor. Of this, USD 98 trillion was public debt (94% of GDP), and over USD 150 trillion was private debt (143% of GDP). These high levels of global debt—especially in public finances—create ripple effects for low-income countries like Tanzania, which recorded a public debt of 43.3% of GDP in the same year. While Tanzania’s debt remains below the average for Low-Income Developing Countries (50% of GDP), increasing global borrowing costs, tighter financial conditions, and slowing global growth (expected to fall from 2.7% to 2.2% over the next five years) pose challenges. These pressures may raise Tanzania’s external debt servicing costs, limit access to affordable financing, and affect government spending and private sector credit growth.

How Global Debt Trends Could Impact Tanzania's Economy and Public Debt

1. Rising Global Public Debt Creates External Pressure

• Global public debt reached USD 98 trillion (94% of global GDP in 2023/2024).
• Many low-income developing countries (LIDCs), including Tanzania, have seen public debt increase. LIDC public debt rose to 50% of GDP, the highest since early 2000s.
• Tanzania’s own public debt stood at about 43.3% of GDP in 2023/2024 (Bank of Tanzania data), below the LIDC average — but upward pressure is visible.

Implication:
As more countries compete for external financing, borrowing costs could rise for Tanzania, especially for external commercial debt. This could lead to higher debt servicing costs and reduce fiscal space for development spending.

2. Reduced Private Sector Borrowing Globally — Credit Squeeze Risk

• Global private debt fell to 143% of GDP, with household debt at 54% and corporate debt at 90%.
• In emerging and low-income economies, private debt growth has slowed or reversed.
• In Tanzania, private sector credit growth declined slightly in 2023/2024, and is mostly concentrated in trade, manufacturing, and personal loans.

Implication:
If global banks and investors become more risk-averse, Tanzania's private sector may face tighter access to credit — especially SMEs and startups that depend on microfinance or external funding.

3. Tight Global Financial Conditions — Impact on Debt Sustainability

• The IMF highlights that higher interest rates globally are not reducing debt levels significantly but are increasing servicing costs.
• Tanzania’s external debt service payments were over USD 1.5 billion in FY2022/23, and this will likely rise with any tightening in external financial markets.

Implication:
Tanzania may need to shift more toward concessional financing or domestic sources to avoid debt distress. Already, the country spends about 14–16% of government revenue on debt service, a figure that could increase if global rates stay high.

4. Risk of Slower Global Growth — Impacts on Tanzania’s Exports and Revenue

• Global medium-term growth expectations declined from 2.7% to 2.2% (5-year forecast).
• This implies reduced demand for Tanzanian exports such as minerals, tourism, and agricultural products.

Implication:
Lower global demand could mean slower foreign exchange earnings, potentially weakening the shilling, reducing government revenue, and making external debt more expensive to repay.

Summary for Tanzania:

Global vs. Tanzania Debt Figures (2023/2024)

What Tanzania Should Consider:

• Prioritize concessional borrowing and monitor external debt exposure.
• Strengthen domestic revenue mobilization to reduce dependency.
• Promote local financial inclusion and SME support to sustain private sector momentum.
• Maintain fiscal prudence to stay below LIDC risk levels (currently at 43.3% of GDP, still manageable).

In 2024, global debt reached a staggering USD 250 trillion, equivalent to 237% of global GDP, according to the IMF’s 2024 Global Debt Monitor. Although this marks a slight decline from the previous year, the level remains significantly higher than the pre-pandemic ratio of 229% in 2019. The overall decline in global debt is mainly attributed to a drop in private debt, which fell by 2.8 percentage points to 143% of GDP, amounting to over USD 150 trillion. This includes household debt at 54% of GDP and non-financial corporate debt at 90% of GDP. Meanwhile, public debt rose by 2 percentage points to 94% of GDP, reaching USD 98 trillion, reflecting a return to its upward trajectory after the pandemic. The data highlights diverging debt trends across countries—with reductions in private debt seen in advanced economies and the US, while China and low-income developing countries experienced significant increases in both public and private debt levels.

Global Debt Overview (2024)

• Total Global Debt (Public + Private):
  📊 USD 250 trillion
  📉 237% of global GDP (down from 238% in 2022/2023)
  ⚠️ Still 8 percentage points above pre-pandemic level (229% in 2019)

Private Debt

• Total Private Debt:
  💵 > USD 150 trillion
  📉 143% of GDP (↓ 2.8 percentage points from 2022/2023)
  ✅ Now below 2019 level (pre-COVID)
• Composition:
  • Households: 📉 54% of GDP
  • Non-financial corporates: 📉 90% of GDP
• By Country:
  • 🇺🇸 United States:
    • ↓ 6 percentage points to 150% of GDP
    • Household ↓ 3.4%, Corporate ↓ 2.5%
  • 🇨🇳 China:
    • ↑ 6.5 percentage points to 205% of GDP
    • Corporate ↑ 5%, Household ↑ 2%
  • 🌍 Emerging Markets (excl. China): Stable at 69% of GDP
  • 🌐 Advanced Economies (excl. US):
    • ↓ 6% to 168% of GDP

Public Debt

• Total Public Debt:
  💰 USD 98 trillion
  📈 Increased by 2 percentage points to 94% of GDP
  ↪️ Returned to pre-pandemic rising trend
• By Country:
  • 🇺🇸 US: ↑ to 123% of GDP
  • 🇨🇳 China: ↑ to 84% of GDP
  • 🌍 EMDEs (excluding China): ↑ to 57% of GDP
  • 🌐 Advanced Economies (excl. US): ↓ to 103% of GDP
  • 🌍 Low-Income Developing Countries (LIDCs):
    • ↑ to 50% of GDP (new high)
    • Private debt ↓ to 38%, but still 4% higher than in 2019

What Drove the Decline in Private Debt?

1. Lower Future Growth Expectations
   ➤ Global 5-year growth forecast fell from 2.7% (2022) to 2.2% (2023/2024)
2. Inflation Surprises
   ➤ Helped reduce real debt ratios:
   • Emerging Markets: Surprise inflation fell from 6% → 2.3%
   • Advanced Economies: Fell from 5.5% → 1.5%
3. Eased Economic Uncertainty (except in the US due to elections)

📌 Notable Highlights

• China has the highest debt-to-GDP ratio globally: 289% of GDP
• The US and Advanced Economies led the global debt decline
• Global debt ratio declined by 20 percentage points since 2020, correcting about two-thirds of the pandemic surge

what the global debt data is telling us:

1. The World Is Still Heavily in Debt

• Total global debt is USD 250 trillion, equal to 237% of global GDP.
• Although this is slightly lower than in 2022, it’s still much higher than before the COVID-19 pandemic (229% in 2019).
• This means countries, companies, and households still carry a very heavy debt burden.

2. Private Sector Is Cleaning Up

• The decline in global debt is mainly due to a drop in private debt (households and companies).
• People and firms are borrowing less or paying back loans, especially in the US and Europe.
• In the US, private debt fell a lot — households and companies reduced borrowing.
• But in China, private debt surged. Companies are borrowing more, despite weak economic signals.

3. Governments Are Borrowing More Again

• After stabilizing, public debt rose again in 2023/2024.
• It’s now at 94% of global GDP, close to COVID levels.
• Countries like China and many low-income nations increased public borrowing, which raises concerns about debt sustainability.

4. Why Is Private Debt Falling?

• Low future growth expectations — people and businesses don’t see big growth coming, so they avoid debt.
• Inflation — when prices rise, the value of old debt falls.
• Less uncertainty — the global economy is more stable than during COVID, so people aren’t borrowing as a precaution.

5. Warnings & Opportunities

• Although private debt is falling, public debt is rising, shifting the risk to governments.
• Some countries, like LIDCs, are hitting dangerously high debt levels again.
• Policymakers may need to focus more on public debt management going forward.

In short:

✅ Households and companies are being cautious
⚠️ Governments are borrowing more again
📉 Global debt is slowly improving, but risks remain

Summary global debt figures:

Global Debt Summary (2023/2024)

Debt by Region or Country (2023/2024)

Momentum for Growth Amid Stability

Tanzania enters 2025/2026 with strong economic momentum, driven by projected GDP growth of 6.1% in 2025 and 6.4% in 2026, marking steady progress from 5.9% in 2024. Inflation remains contained at 3.2%–3.5%, ensuring price stability for consumers and businesses. Dynamic sectors such as ICT (13.5% growth by 2026), energy (12.0%), and mining (9.3%) are fueling economic transformation, while private sector credit is expanding robustly at over 20% annually. With public debt stabilized at around 46.5% of GDP and strong revenue performance (100%+ of targets), Tanzania is well-positioned for inclusive growth and investment expansion in key industries.

Tanzania Business Report 2025: Growth, Stability & Sectoral Transformation

Tanzania's economy in 2025 is poised on solid footing, building on the steady momentum of previous years. With consistent policy direction and resilience across sectors, the country presents a compelling picture for investors, analysts, and business stakeholders.

Macroeconomic Highlights (2020–2024)

• Real GDP Growth climbed from 4.5% in 2020 to 5.9% in 2024, indicating a gradual post-pandemic recovery and strong domestic activity.
• Headline Inflation remained moderate, ending 2024 at 3.0%, reinforcing price stability.
• The Exchange Rate (TZS/USD) depreciated slightly from 2,323 (2022) to 2,585 by Dec 2024, reflecting manageable currency pressures.
• Public Debt rose to ~46.3% of GDP in nominal terms but remains sustainable with a PV (Present Value) ratio of 41.1%.

Sectoral Performance (Growth %)

Top Performers: ICT, Energy, and Mining sectors drove 2024 growth, with ICT growing at a remarkable 12.5% and Energy at 11.0%, bolstered by digital transformation and energy infrastructure investments.

Trade Dynamics

• Exports of Goods & Services rebounded strongly in 2023 (+39.0%) but contracted -1.5% in 2024.
• Imports continued a positive trend, expanding by 6.4% in 2024, suggesting increased domestic demand.

Banking & Credit Sector

• Commercial Bank Deposits rose 15.6%, indicating confidence in the financial system.
• Lending Growth improved to 15.4%, with Private Sector Credit jumping 21.2%, reflecting a pro-business credit environment.

Government Fiscal Operations

Strong revenue collection (99.5% of target) and controlled deficit spending reflect fiscal discipline amid rising development investment.

Inflation Breakdown

The inflation structure indicates broad price stability, particularly in essential sectors.

Outlook

Tanzania heads into 2025 with strong momentum in ICT, energy, and industrial growth. Stable inflation, a healthy banking sector, and expanding infrastructure projects offer a conducive environment for private investment and business expansion.

📊 “Tanzania continues to set the pace in East Africa for diversified, resilient economic growth.”

Forecast for Tanzania for the year 2025/2026: Macroeconomic indicators, sectoral performance, trade, banking, fiscal operations, and inflation.

Macroeconomic Forecast: Tanzania (2025–2026)

Sectoral Growth Forecast (% Change)

Trade Forecast (% Change)

Banking & Credit Forecast (% Growth)

Government Fiscal Operations (% Change)

Inflation Breakdown (% Change)

Stability, Growth & Sectoral Momentum

Tanzania is heading into 2025/2026 with strong and balanced growth, supported by moderate inflation, stable fiscal management, and dynamic performance across key economic sectors.

Macroeconomic Outlook

• GDP growth is projected to accelerate to 6.1% in 2025 and 6.4% in 2026, indicating a robust economic recovery driven by infrastructure investments, digital economy growth, and regional trade.
• Inflation remains under control (around 3.2%–3.5%), which supports consumer purchasing power and business planning.
• The exchange rate will depreciate slowly, suggesting external stability but continued pressure from imports and global currency trends.
• Public debt remains sustainable, with only slight increases, showing effective debt management and continued investor confidence.

Sectoral Trends

• Top performing sectors will be:
  • ICT & Digital Economy: Growth will hit 13.5% in 2026, fueled by digital infrastructure, mobile usage, and e-services.
  • Energy Sector: Rapid growth (12% by 2026) shows Tanzania’s push in electricity and gas infrastructure.
  • Mining and Manufacturing: Ongoing reforms and mineral demand will sustain strong growth above 9% and 5.9% respectively.
• Agriculture, though steady, is growing slower — indicating the need for modernization and value chain development.
• Tourism is on the rebound, projected to reach 7% growth, reflecting increased travel and hospitality recovery.

Trade Dynamics

• Exports are projected to recover strongly (+6.0% in 2025 and +8.5% in 2026) after the 2024 dip — thanks to minerals, agriculture, and tourism.
• Imports will continue rising moderately, reflecting strong domestic demand for capital goods, industrial inputs, and consumer goods.

Financial Sector Confidence

• Commercial bank deposits and lending remain strong, growing above 14% annually, showing business confidence and expanding access to finance.
• Private sector credit growth above 20% indicates strong investment appetite and supportive banking environment.

Fiscal Responsibility

• The government will maintain a manageable budget deficit (~2% of GDP) while increasing both revenue and development spending.
• Grants are declining (only ~1% of revenue by 2026), signaling greater self-reliance in public finances.

Cost of Living

• Inflation is mild across food, housing, and transport — a positive sign for households and business cost planning.

Bottom Line

Tanzania in 2025/2026 is set for strong, inclusive, and sustainable growth, with opportunities in:

• Digital economy
• Energy infrastructure
• Export diversification
• Tourism revival
• Financial sector expansion

Employment Trends in Tanzania (2025-2030), Bridging the Formal and Informal Gap

Tanzania’s workforce is 71.8% informal (25.95 million workers) and 28.2% formal (10.17 million workers), highlighting a major divide in job security, wages, and social protection. While formal employment is projected to rise to 38% by 2030, barriers such as limited job availability (42%), skills mismatches (26%), and bureaucratic challenges (21%) slow the transition. This report explores the key trends, challenges, and opportunities in Tanzania’s employment landscape, emphasizing the role of industrialization, digital transformation, and policy reforms in shaping the future workforce.

Key Figures

• 71.8% of Tanzania's workforce (approx. 25.95 million workers) is employed in the informal sector.
• 28.2% of the workforce (approx. 10.17 million workers) is in formal employment.
• The formal employment rate is projected to increase to 38% by 2030.
• 82% of respondents reported that digitalization has increased job opportunities.
• 49% of workers surveyed are in informal employment, while 23% are in formal jobs, and 27% are unemployed.
• 54% of informal workers were unaware of government formalization programs.
• Agriculture employs 28% of Tanzania's workforce, mostly informally.
• Small businesses make up 44% of the informal economy.

Main Issues Breakdown

1. The Divide Between Formal and Informal Employment

• Formal employment offers stability, benefits, and social security, but access is limited due to education, experience, and bureaucracy.
• Informal employment dominates the economy, with workers in agriculture, small businesses, and retail trade.
• Barriers to transitioning to formal jobs include:
  • Limited job availability (42%)
  • Skills mismatches (26%)
  • Bureaucratic registration processes (21%)

2. Education and Employment Trends

• 83% of formal sector workers hold a bachelor’s degree or higher.
• Workers with lower education levels (primary & secondary) are mostly in the informal sector.
• Diploma and vocational training holders find jobs mainly in skilled trades like construction and manufacturing.

3. Work Experience and Job Stability

• 25% of workers have less than 1 year of experience (mostly informal jobs).
• 49% have 2-5 years of experience, indicating a high number of early-career professionals.
• Mid-career workers (6-10 years) transition into formal employment.
• Senior professionals (10+ years) occupy leadership roles.

4. Challenges in Informal Employment

• No social protections (health insurance, pensions).
• Low and unstable incomes due to seasonal work.
• Limited access to financial services (loans and investment).
• Complex business registration discourages small businesses from formalizing.

5. Factors Encouraging Formalization

• 50% of workers are attracted by social security and benefits.
• 20% prefer formal jobs due to higher wages.
• 14% say government incentives (such as tax exemptions) help.
• 16% want simplified formalization processes.

6. Digital Technology and Employment Growth

• 82% of workers say technology has improved job creation.
• 53% reported that mobile banking and e-commerce have boosted employment.
• ICT, fintech, and digital platforms are creating new job opportunities.

7. Job Creation by Sector

• Agriculture (28%) is the largest employer but remains mostly informal.
• Manufacturing (18%) is growing due to industrialization.
• Construction (14%) benefits from government infrastructure projects.
• Technology/ICT (9%) is fast-growing but underdeveloped.

Policy Recommendations

To address these employment challenges, the report suggests:

1. Expand Industrialization and Special Economic Zones (SEZs) to increase formal jobs.
2. Improve Vocational Training to align skills with industry needs.
3. Simplify Business Registration and Taxation to encourage formalization.
4. Enhance Digital and Remote Work Opportunities through ICT training.
5. Introduce Affordable Social Protection Schemes for informal workers.

Conclusion

The Tanzanian labor market is shifting towards more formalization, but challenges like bureaucracy, low education levels, and financial constraints remain. The digital economy and government policy reforms present new opportunities to increase formal employment and improve workforce stability.

Employment Trends by Sector in Tanzania (2025-2030)