Tanzania's total national debt stock (external + domestic) stood at USD 50,932.1 million at end-October 2025, equivalent to approximately TZS 125.3 trillion at the average exchange rate of TZS 2,460 per USD for the month. This marks a marginal 0.1% decline from end-September's USD 50,772.4 million (TZS 124.9 trillion), primarily due to amortization offsets exceeding new disbursements, per the Bank of Tanzania's (BoT) Monthly Economic Review for November 2025 (covering October data). As of December 13, 2025, preliminary estimates from the Ministry of Finance and market sources (e.g., TICGL reports) suggest the stock has stabilized around USD 51,000 million (TZS 125.5 trillion), with no major November auctions altering the trajectory significantly—domestic issuance totaled TZS 764.5 billion in September, but October's TZS 327.7 billion was more subdued. The debt-to-GDP ratio remains at 49.6%, down from 50.8% in September, reflecting 6.3% Q2 GDP growth and prudent management under the FY2025/26 budget (TZS 49.2 trillion total).

Economic Implications: At ~50% of GDP, the debt level is sustainable per IMF benchmarks (moderate risk of distress), enabling concessional financing for Vision 2050 priorities like infrastructure (28% budget allocation, contributing 1.2% to GDP via hydropower/roads) and social sectors (21.5% share, aiding poverty reduction from 26.4%). The slight contraction provides fiscal breathing room, capping service costs at 6.5% of revenues (TZS 3.2 trillion annually) and supporting monetary easing (CBR at 5.75%). However, with tax revenues at 13.1% of GDP (below peers' 17%), reliance on borrowing risks crowding-out private credit (16.1% YoY growth but below 20% target), potentially shaving 0.5% off 6.2% FY2025/26 growth if yields rise amid global tightening. Positively, shilling appreciation (9.5% YoY) has saved TZS 3-4 trillion in external servicing, bolstering reserves (USD 6.17 billion, 4.7 months cover) and inflation anchoring (3.4% in November). Read More: Tanzania’s National Debt October 2025

1.1 Debt-to-GDP and Service Trends (Updated to November 2025)

Source: BoT November Review; preliminary November from TICGL and Trading Economics (government debt USD 15,334M Sep, partial). Trends: November stabilization (est. +0.2% MoM) ties to TZS 750 billion bond auctions (oversubscribed 2.1x), per TICGL.

Economic Implications: Contained ratio (below 55% EAC threshold) enhances credibility, lowering Eurobond spreads (6.8%) and attracting FDI (USD 1.5 billion Q3, +10% YoY). Service stability frees 2% budget for capex (47.2% execution), driving 6% growth, but low revenue elasticity (1.1) heightens vulnerability—Deloitte 2025 recommends digital tax reforms to add TZS 1-2 trillion, mitigating 1% GDP drag from potential arrears.

2. EXTERNAL DEBT (IN TZS)

External debt totaled USD 35,385.5 million at end-October 2025, equivalent to TZS 87.1 trillion (69.5% of total national debt). This reflects a 0.1% MoM decline from September's USD 35,438.3 million (TZS 87.2 trillion), driven by USD 131 million in amortizations outpacing USD 89.9 million in new loans. As of December 13, 2025, estimates peg it at ~USD 35,400 million (TZS 87.2 trillion), with November net disbursements of USD 50 million (mostly multilateral for infra). The portfolio is 66% USD-denominated, with average interest at 3.2% and maturity 12.8 years, ensuring concessionality (grant element 45%).

Economic Implications: External dominance (69.5%) leverages low-cost multilateral funds (57.4% share) for productive investments (e.g., USD 443 million September disbursements to energy/social, adding 0.8% GDP), aligning with AfCFTA (USD 1 billion trade potential). Shilling strength saves TZS 2.5 trillion in servicing (USD 220.5 million October, TZS 0.54 trillion), stabilizing reserves and inflation (non-food 2.1%). However, USD exposure amplifies FX risks—depreciation could add 0.5% to CPI—while private sector rise (18.3%) signals maturity but ties growth to FDI (10% YoY). IMF notes moderate distress risk, but export dependency (gold 50%) warrants hedging to sustain 6.2% growth.

2.1 Breakdown within External Debt

November Update: Service est. USD 210 million (TZS 0.52 trillion, -5% MoM); new loans USD 120 million (TZS 0.30 trillion), per TICGL.

Economic Implications: Public skew (81.7%) channels resources to multipliers (roads/energy +1.2% GDP), but private growth fosters diversification (18.3%, supporting manufacturing 3.5%). Low service (12% exports) aids buffers, yet new loans' concessionality (45% grants) is key—shifts to commercial (35.2%) could raise costs 1%, per World Bank, risking 0.3% growth drag without revenue hikes.

3. DOMESTIC DEBT (IN TZS)

Domestic debt reached TZS 38,114.8 billion (TZS 38.1 trillion) at end-October 2025, up 1.8% from September's TZS 37,459 billion, driven by TZS 327.7 billion issuance. As of December 13, 2025, it stands at ~TZS 38.5 trillion (+1% est. from November bonds TZS 750 billion), comprising 30.5% of total debt. Composition favors long-term instruments (T-bonds 77.5%), with average yield 10.8% and maturity 8.2 years.

Economic Implications: Domestic rise (30.5% share) reduces FX risks (vs. 69.5% external), funding 83.6% of development spend (TZS 137 billion October) for infra (2% GDP boost). Institutional concentration (banks/pensions 51.5%) ensures stability but crowds-out SMEs (credit 16.1% vs. 20% target), per SECO 2025—retail expansion (27% "others") could unlock TZS 1 trillion, enhancing inclusion. Service (TZS 482.4 billion October, 12% revenues) is manageable, but yield sensitivity risks 0.4% budget pressure if liquidity tightens.

3.1 Composition of Domestic Debt

November Update: Banks ~32% (est. TZS 12.3 trillion), others +2% from retail bonds, per TICGL.

3.2 Borrowing Instruments (Domestic Market)

Economic Implications: Bond dominance extends maturities, curbing rollover (25% in 2024), but bill reliance (21.9%) signals short-term bias—shifting to bonds saves 0.5% interest (TZS 1.4 trillion annually). Instruments support 65% development budget, but "others" growth aids inclusion (1 million retail holders), potentially adding 0.5% GDP via multipliers.

4. GOVERNMENT DEBT ISSUANCE & SERVICING

October issuance focused on domestic (TZS 327.7 billion, 100% market-based), with bonds 55% for maturity extension. Servicing totaled TZS 482.4 billion (domestic), consuming 20.7% of revenues but below 25% sustainability threshold.

4.1 Issuance in October 2025

November Update: TZS 750 billion (bonds 80%), oversubscribed 2x, yields stable (10.85% 5-year), per BoT.

4.2 Debt Service (Domestic)

Economic Implications: Modest issuance (TZS 327.7 billion, 14% monthly deficit) maintains discipline, funding capex without monetization, while service (TZS 482.4 billion) pressures revenues—yet concessional terms keep ratio low (12% exports). November surge supports Q4 growth (6.9% est.), but external service (USD 220.5 million October) risks FX drain; hedging via forwards saves 0.3% GDP, per Afreximbank.

5. SUMMARY: TANZANIA NATIONAL DEBT (AS OF OCT 2025)

November Est.: Total ~TZS 125.5T (+0.2%); external stable, domestic +1% (TICGL/Trading Economics).

Overall Economic Implications: Tanzania's TZS 125.3 trillion debt (October) funds resilient growth (6.3% Q2), with balanced external/domestic mix (69.5/30.5%) and concessional terms (45% grants) ensuring sustainability—IMF affirms moderate risk, projecting 48% GDP by 2026. It catalyzes infra/social multipliers (2% GDP), reserves (4.7 months), and FDI, but low revenues (13.1% GDP) and USD exposure (66%) pose risks: potential 1% service hike could crowd-out 0.5% growth. Policy focus on tax digitalization and exports (gold/tourism +15%) will unlock USD 10 billion AfCFTA potential, per World Bank, sustaining upper-middle-income trajectory by 2050.

In June 2025, Tanzania’s national debt reached TZS 116.6 trillion (USD 45.4 billion), a 13.5% increase from TZS 102.8 trillion in June 2024, driven by external borrowing (70.7% of total, TZS 82.4 trillion) for infrastructure and fiscal deficits. The Tanzania Shilling (TZS) depreciated by 9.6% year-on-year against the USD (2,569.46 TZS/USD), raising external debt servicing costs (USD 1–2 billion annually), despite robust reserves of USD 5,307.7 million (4.3 months of import cover). Supported by tourism receipts (USD 7,104 million) and a moderate debt-to-GDP ratio (~44.3%), Tanzania’s debt and TZS remain sustainable in the short term, but import reliance and USD exposure (67.6% of external debt) pose long-term challenges.

Tanzania National Debt Overview (June 2025)

Tanzania’s national debt encompasses public debt (domestic and external) and private sector external debt, critical for assessing fiscal sustainability. The attached document and provided data offer insights into debt stock, composition, and servicing, which are analyzed below.

• Total National Debt:
  • Value: TZS 116.6 trillion (USD 45.4 billion at 2,569.46 TZS/USD).
  • Annual Increase: +13.5% from TZS 102.8 trillion (USD 43.8 billion at 2,345.38 TZS/USD) in June 2024.
  • Context: The document notes the national debt stock at USD 45,586.6 million (~TZS 117.1 trillion) in June 2025, aligning closely with the provided TZS 116.6 trillion. The 13.5% increase reflects increased borrowing for infrastructure (e.g., Standard Gauge Railway, Julius Nyerere Hydropower Plant) and fiscal deficits (2.5% of GDP in 2024/25). Earlier data shows USD 48,479.9 million in April 2025 and USD 48,217.0 million in February 2025, suggesting a slight decline by June due to repayments or exchange rate effects.
  • Debt-to-GDP Ratio: Estimated at ~44.3% based on a GDP of ~USD 102.6 billion (2022 GDP of USD 105.1 billion, adjusted for 5.6% growth in 2024 and 6% in 2025). The IMF’s 2024 Debt Sustainability Analysis (DSA) reports a public debt-to-GDP ratio of 35%, below the 55% benchmark for low-income countries, indicating moderate distress risk. However, World Economics estimates a higher GDP (~USD 155.5 billion), implying a lower ratio of ~29.2%, highlighting data variability.
  • Implications: The 13.5% debt increase supports growth-enhancing projects but raises servicing costs (~40% of government expenditures, per IMF). The moderate debt-to-GDP ratio suggests sustainability, but TZS depreciation (9.6% against USD) increases external debt burdens.
• Domestic Debt:
  • Stock: TZS 35.5 trillion (USD ~13.8 billion, 29.3% of total debt).
  • Annual Increase: +11.1% from TZS 32.0 trillion in June 2024.
  • Monthly Increase: +0.9% from May 2025 (~TZS 35.2 trillion, based on April 2025’s TZS 34,759.9 billion).
  • By Instrument:

By Creditor:

• Context: The document confirms TZS 85.9 billion raised via bonds in June 2025, with TZS 93.96 billion spent on debt service (TZS 60.13 billion principal, TZS 33.83 billion interest, correcting the document’s typo of TZS 276.8 billion). The 11.1% annual growth reflects financing of fiscal deficits (e.g., TZS 270.2 billion in May 2025 for Mainland Tanzania). Treasury bonds’ 83.2% share aligns with a shift to long-term instruments, reducing refinancing risks.
• Implications: The diversified creditor base (28.6% banks, 26.1% pension funds) and long-term bond dominance enhance stability, but high borrowing rates (15.5% lending rates) crowd out private sector credit, which weakened in Q4 2024. The document’s note on retail investor participation via TIPS (18.1% “Others”) supports financial inclusion.
• External Debt:
  • Stock: TZS 82.4 trillion (USD 33.0 billion, 70.7% of total debt).
  • Annual Increase: +14.8% from TZS 71.8 trillion (USD 30.6 billion) in June 2024.
  • By Borrower:

By Use of Funds:

By Currency:

• Context: The document’s tables (e.g., Table 2.2, 2.3, 2.4) confirm the external debt stock and composition, with USD 109.9 million disbursed in April 2025 for projects like SGR and TAZARA Railway (25.4% transport). The 14.8% increase reflects concessional loans (e.g., IMF’s USD 441 million ECF/RSF, World Bank’s USD 527 million) and non-concessional borrowing (34% of external debt). The 67.6% USD share amplifies risks from the 9.6% TZS depreciation.
• Implications: The central government’s 85.4% share aligns debt with development priorities (e.g., Vision 2050), but low industry (4%) and agriculture (6.5%) allocations limit structural transformation. High USD exposure increases servicing costs (USD 80.9 million in April 2025), with external debt service at ~2.89% of GNI in 2023.
• Debt Servicing:
  • Domestic: TZS 93.96 billion in June 2025 (TZS 60.13 billion principal, TZS 33.83 billion interest), per the document. Annual servicing was TZS 890.9 billion in February 2025 (TZS 609.9 billion principal, TZS 281 billion interest).
  • External: USD 80.9 million in April 2025, with annual estimates of USD 1–2 billion, driven by USD-denominated debt (67.6%) and TZS depreciation.
  • Context: Servicing absorbs ~40% of government expenditures, per IMF, straining fiscal space. Concessional loans (e.g., World Bank, 48% of external debt) mitigate costs, but non-concessional borrowing raises concerns.
  • Implications: High servicing costs limit development spending (33.7% of Zanzibar’s budget), necessitating revenue mobilization (TZS 2,689.2 billion in May 2025, 3.1% above target) and export growth.

Tanzania Shilling (TZS) Sustainability

The TZS’s sustainability is assessed through its exchange rate stability, depreciation trends, and impact on debt servicing, drawing from the provided data and document’s external sector insights (e.g., Charts 2.7.1–2.7.3, Table 2.7.1).

• Exchange Rate Performance:
  • USD/TZS (IFEM):
    • June 2024: 2,345.38
    • May 2025: 2,565.08
    • June 2025: 2,569.46
    • Annual Depreciation: -9.6%
    • Monthly Change: -0.2% (May to June 2025)
  • Bureau de Change:
    • Buying Rate: 2,574.33 TZS/USD
    • Selling Rate: 2,582.67 TZS/USD
  • Other Currencies:

• Context: The document notes improved IFEM liquidity in June 2025, driven by seasonal cash crop exports (e.g., cashew nuts, tobacco) and gold exports (USD 3,369.7 million annually). The 9.6% depreciation aligns with earlier trends (9% in 2024, 8% in 2023), but a slight 0.28% appreciation in October 2024 and 2.6% by January 2025 indicate periods of stability. The BoT’s USD 7 million intervention in January 2025 and reserves of USD 5,307.7 million (4.3 months of import cover) support orderly markets.
• Drivers:
  • Import Demand: Goods imports rose to USD 459.5 million in Zanzibar and USD 13,040.7 million for Tanzania (Table A7), driven by capital goods (e.g., SGR, hydropower).
  • Export Shortfalls: Zanzibar’s exports fell to USD 150.3 million (-11.9%), with cloves down 27.2%. Tanzania’s goods exports grew to USD 1,036 million (Table 2.7.1), led by gold and cereals (USD 501.3 million), but were insufficient to offset imports.
  • Global USD Strength: U.S. monetary tightening increased USD demand, impacting emerging market currencies like the TZS.
• Implications: The 9.6% depreciation raises import and debt servicing costs, contributing to inflation (3.4% in Zanzibar, 3.2% in Mainland). The narrow Bureau spread (0.3%) and low dollarization (3.2% of Mainland businesses use USD) indicate market confidence, but sustained depreciation pressures reserves.
• Forex Market Activity:
  • IFEM Volume: USD 65.4 million in June 2025, +12.6% from USD 58.1 million in May 2025 (document, Page 10). This reflects trade settlements and seasonal imports, compared to USD 95.7 million in December 2024.
  • Reserves: USD 5,307.7 million (Chart 2.7.1), covering 4.3 months of imports, down slightly from USD 5,323.6 million in January 2025 but sufficient per IMF’s 4-month threshold.
  • Implications: Increased IFEM activity signals robust demand, but reserves and BoT interventions (e.g., USD sales) ensure stability. Service receipts (USD 7,104 million, driven by tourism’s 10% arrival increase to 2,333,322) bolster forex inflows.
• TZS Sustainability:
  • Stability: The TZS’s “orderly and market-driven” performance (document, Page 10) and minimal monthly depreciation (-0.2%) indicate short-term stability, supported by reserves and interventions.
  • Risks: The 9.6% annual depreciation and high USD debt exposure (67.6%) increase servicing costs, with external debt service at USD 1–2 billion annually. Import reliance (USD 13,040.7 million) and export volatility (e.g., cloves) strain reserves.
  • Mitigating Factors: Tourism receipts (USD 7,104 million), FDI (USD 3.7 billion), and concessional financing (e.g., IMF’s USD 441 million) support forex inflows. The BoT’s 6% Central Bank Rate (Page 7) controls inflation (3%–5% target), stabilizing the TZS.
  • Implications: The TZS is sustainable in the short term, but long-term pressures from depreciation and import growth require export diversification (e.g., cereals, manufactured goods) and reserve accumulation.

Debt and TZS Sustainability Metrics

Key Insights and Policy Implications

1. Debt Sustainability:
   • Status: The TZS 116.6 trillion debt (44.3% of GDP) is sustainable per the IMF’s DSA (below 55% benchmark), with moderate distress risk. External debt’s 70.7% share and 14.8% growth support infrastructure (25.4% transport) but increase servicing costs (USD 1–2 billion annually).
   • Policy: Prioritize concessional financing (e.g., World Bank’s USD 527 million) and revenue mobilization (TZS 2,339.2 billion tax revenue in May 2025, 4.1% above target) to reduce non-concessional borrowing (34% of external debt).
2. TZS Sustainability:
   • Status: The 9.6% depreciation and stable monthly performance (-0.2%) indicate short-term TZS stability, supported by reserves (USD 5,307.7 million) and tourism receipts (USD 7,104 million). However, import reliance and USD debt exposure pose long-term risks.
   • Policy: Boost exports (e.g., cereals, USD 501.3 million; manufactured goods) via AfCFTA and diversify debt currencies to mitigate USD risks (67.6% share).
3. Debt-TZS Nexus:
   • Impact: TZS depreciation increases external debt servicing costs, with USD 22.3 billion (67.6%) in USD-denominated debt. This contributes to inflation (3.4% in Zanzibar) and fiscal pressure.
   • Policy: Strengthen reserves through FDI (USD 3.7 billion) and tourism (2.3 million arrivals) to stabilize the TZS and reduce servicing costs.
4. Economic Context:
   • Growth: 5.6% GDP growth in 2024 and 6% projected for 2025 support debt absorption, driven by tourism and infrastructure.
   • Risks: TZS depreciation, global USD strength, and export volatility (e.g., cloves -27.2%) threaten sustainability. Climate shocks and election uncertainties (October 2025) add risks.
   • Opportunities: Vision 2050, MKUMBI II reforms, and digital financial inclusion (TIPS, 453.7 million transactions) enhance fiscal and TZS resilience.

Critical Examination of the Establishment Narrative

• Debt Optimism: The BoT and IMF emphasize sustainability (35% debt-to-GDP), but the 13.5% debt increase and 9.6% TZS depreciation raise servicing concerns, especially with USD debt (67.6%). The IMF’s moderate risk rating may understate long-term vulnerabilities if exports (e.g., cloves) or tourism falter.
• TZS Stability: The BoT’s “orderly market” narrative (Page 10) is supported by reserves and interventions, but high import demand (USD 13,040.7 million) and global USD strength challenge long-term TZS sustainability. X posts on regional debt (e.g., Kenya’s unsustainable levels) suggest broader risks.
• Crowding Out: The narrative overlooks domestic borrowing’s crowding-out effect (15.5% lending rates), limiting private sector credit (12.8% growth in January 2025) and Vision 2050’s private sector-led goals.

Between 2021/22 and 2025/26, Tanzania's debt service costs surged by 42–58%, from an estimated TZS 9–10 trillion to a confirmed TZS 14.22 trillion—now accounting for 25.2% of the national budget (TZS 56.49 trillion). Over this period, total public debt rose to approximately 46% of GDP, driven largely by external borrowing, which reached USD 33.9 billion in 2025/26 and remains 67.7% USD-denominated, exposing the country to exchange rate risks, especially following a 2.6% shilling depreciation in 2024/25. Domestic debt also expanded significantly to TZS 34.26 trillion, with the majority held by commercial banks and pension funds. Despite a stabilizing debt-to-GDP ratio and a manageable debt service-to-GNI ratio of 2.89% (2023), the growing reliance on non-concessional and foreign currency debt underscores fiscal vulnerabilities that require prudent debt management strategies to ensure long-term sustainability.

Escalating Service Costs

Tanzania's debt servicing landscape has undergone significant transformation over the past five years, reflecting the country's economic growth trajectory and evolving fiscal priorities. The most striking development is the substantial increase in debt service costs, which have risen from an estimated TZS 9-10 trillion in 2021/22 to TZS 14.22 trillion in 2025/26 – representing a 42-58% increase over the five-year period.

Key Performance Indicators at a Glance:

• Current Debt Service (2025/26): TZS 14.22 trillion (25.2% of national budget)
• Total Public Debt: Approximately 46% of GDP (2025/26)
• External Debt: USD 33.9 billion (67.7% USD-denominated)
• Domestic Debt: TZS 34.26 trillion
• Debt Service-to-GNI Ratio: 2.89% (2023 data)
• Five-Year Growth in Debt Service: 42-58% increase

Detailed Year-by-Year Analysis

2021/22 Financial Year: Foundation Period

The 2021/22 period established the baseline for Tanzania's modern debt management framework. With debt service costs estimated at TZS 9-10 trillion, the government maintained a relatively moderate debt burden at 43.6% of GDP. The debt composition showed a balanced approach with domestic debt at 15.9% of GDP and external debt forming the larger portion. Notably, domestic arrears stood at a manageable 1.8% of GDP, indicating effective short-term debt management.

The present value debt-to-GDP ratio of 31% remained well below the 55% benchmark, positioning Tanzania in the low-to-moderate debt distress risk category. External borrowing was predominantly concessional, reducing the overall cost burden and exchange rate exposure.

2022/23 Financial Year: Strategic Expansion

The government allocated TZS 9.1 trillion for debt servicing within a total budget of TZS 44.4 trillion, with TZS 7.4 trillion successfully disbursed by April 2023. This period marked a strategic shift as public debt increased to 45.7% of GDP (46.7% including domestic arrears), reflecting increased infrastructure investment.

External debt composition rose to 63.3% of total debt, indicating a pivot toward international financing for development projects. The shift toward non-concessional borrowing began during this period, driven by infrastructure financing needs. Despite this increase, the present value debt-to-GDP ratio remained sustainable at 31.8%.

2023/24 Financial Year: Acceleration Phase

Debt servicing allocation reached TZS 10.48 trillion, representing a 15% increase from the previous year. This increase occurred within a Ministry of Finance budget of TZS 15.94 trillion, highlighting debt service as a major fiscal priority. Total public debt climbed to 47.36% of GDP, with external debt reaching USD 30.533 billion by July 2023.

The debt structure showed concerning trends with external debt comprising 73% of total obligations, significantly increasing Tanzania's exposure to exchange rate fluctuations. Total national debt reached approximately TZS 69.44 trillion in 2022, continuing its upward trajectory through 2023.

2024/25 Financial Year: Consolidation Efforts

Debt service costs are estimated at TZS 11-12 trillion within a national budget of TZS 49.35 trillion. External debt peaked at USD 32.89 billion in September 2024, subsequently reaching USD 33.905 billion by January 2025. The central government held 78.1% of external debt, indicating concentrated fiscal responsibility.

Domestic debt stabilized at TZS 32.62 trillion in September 2024, with Treasury bonds dominating at 78.9% of domestic obligations. The debt-to-GDP ratio showed signs of stabilization, with projections indicating a gradual decline to 40.84% by 2029, suggesting improved debt sustainability measures.

2025/26 Financial Year: Current Trajectory

The current budget allocation confirms TZS 14.22 trillion for debt servicing, including TZS 6.49 trillion specifically for interest payments. This represents the highest debt service allocation in the five-year period, occurring within a total budget of TZS 56.49 trillion. External debt stands at USD 33.905 billion, with the government holding 76.4% of these obligations.

Domestic debt has grown to TZS 34.26 trillion as of March 2025, primarily held by commercial banks (29-33%) and pension funds (26.5-27.6%). The USD-dominated debt structure (67.7-68.1%) continues to pose exchange rate risks, particularly given the 2.6% depreciation of the Tanzanian Shilling in 2024/25.

Tanzania National Debt Service Costs (2021/22–2025/26)

Key Observations

1. Trend in Debt Service Costs: Debt service costs have increased steadily, from an estimated TZS 9–10 trillion in 2021/22 to TZS 9.1 trillion in 2022/23, TZS 10.48 trillion in 2023/24, an estimated TZS 11–12 trillion in 2024/25, and a confirmed TZS 14.22 trillion in 2025/26. This reflects growing borrowing, particularly external debt (73% of total debt in 2024), and larger budgets (TZS 44.4 trillion in 2022/23 to TZS 56.49 trillion in 2025/26). The 18–29% jump from 2024/25 to 2025/26 is driven by increased interest payments (TZS 6.49 trillion in 2025/26) and a higher debt stock.
2. Debt Composition: External debt, predominantly USD-denominated (67.7–68.1%), reached USD 33.905 billion in 2025, exposing Tanzania to exchange rate risks, with a 2.6% shilling depreciation in 2024/25 increasing repayment costs. Domestic debt, mainly Treasury bonds (78.9% in 2024), rose from an estimated TZS 22.17 trillion in 2021/22 to TZS 34.26 trillion in 2025/26, held primarily by commercial banks (29–33%) and pension funds (26.5–27.6%).
3. Sustainability: Tanzania’s debt-to-GDP ratio increased from 43.6% in 2021/22 to 47.36% in 2023/24, stabilizing at ~46% in 2024/25–2025/26, with a projected decline to 40.84% by 2029. The debt service-to-GNI ratio was 2.8915% in 2023, indicating moderate debt distress risk per IMF and World Bank analyses. However, reliance on non-concessional borrowing and USD exposure poses challenges, particularly with shilling depreciation.

Tanzania’s external debt has shown a significant upward trend, reaching 35,039.8 USD Million in February 2025, up from 34,551.4 USD Million in January 2025, according to the Bank of Tanzania. This marks a month-on-month increase of approximately 488.4 USD Million or 1.41%. The external debt has grown steadily, averaging 20,062.78 USD Million from 2011 to 2025, with a record high of 34,936.5 USD Million in February 2025 and a low of 2,469.7 USD Million in December 2011. This reflects a substantial increase over the years, driven by investments in infrastructure, energy, and other development projects.

Tanzania’s External Debt in Context

Tanzania’s external debt is a critical indicator of its economic position within Africa and East Africa. To provide a comprehensive understanding, let’s compare Tanzania’s external debt to other African and East African countries, analyze its debt-to-GDP ratio, and explore the factors contributing to its debt profile.

Comparison with African Countries

The provided data lists external debt for several African countries, with figures converted to USD Million where necessary for comparison. Using the most recent data from the table and supplementing with additional context:

• South Africa: 168,379 USD Million (Dec 2024) – The highest external debt in the dataset, reflecting South Africa’s position as one of Africa’s largest economies.
• Egypt: 155,204 USD Million (Sep 2024) – Another major economy with significant external borrowing, driven by infrastructure and energy projects.
• Angola: 50,260 USD Million (Dec 2023) – High debt due to oil-related investments and reliance on external financing.
• Nigeria: 42,900 USD Million (Sep 2024) – A major oil-producing nation with considerable external debt, though lower than Tanzania’s relative to GDP.
• Tanzania: 34,056 USD Million (Mar 2025) – Ranks among the top tier of African countries in terms of external debt, reflecting its ambitious development agenda.
• Ghana: 28,300 USD Million (Dec 2024) – Lower than Tanzania, but Ghana faces higher debt distress risks due to a higher debt-to-GDP ratio.
• Rwanda: 7,916 USD Million (Dec 2023) – An East African neighbor with significantly lower external debt than Tanzania.
• Kenya: 5,057 KES Billion (approx. 37,173 USD Million at an exchange rate of 1 KES = 0.00735 USD, Dec 2024) – Comparable to Tanzania, but slightly higher, reflecting Kenya’s larger economy.
• Burundi: 1,873,263 BIF Million (approx. 650 USD Million at an exchange rate of 1 BIF = 0.000347 USD, Dec 2024) – Significantly lower, reflecting Burundi’s smaller economy.

Tanzania’s external debt of 34,056 USD Million (Mar 2025) places it among the top 10 African countries for external debt, behind economic giants like South Africa, Egypt, and Nigeria, but ahead of smaller economies like Rwanda and Burundi. This reflects Tanzania’s growing economic ambitions but also its increasing reliance on external financing.

Comparison with East African Community (EAC) Countries

Within East Africa, Tanzania’s external debt is significant but not the highest. Key EAC countries include:

• Kenya: Approximately 37,173 USD Million (Dec 2024) – Slightly higher than Tanzania, driven by large infrastructure projects like the Standard Gauge Railway (SGR).
• Tanzania: 34,056 USD Million (Mar 2025) – A close second, with debt growth tied to infrastructure, energy, and mining investments.
• Rwanda: 7,916 USD Million (Dec 2023) – Much lower, reflecting Rwanda’s smaller economy and more cautious borrowing.
• Uganda: Data not provided, but recent estimates suggest around 20,000 USD Million (2023), lower than Tanzania due to a less diversified economy.
• Burundi: 650 USD Million (Dec 2024) – Minimal debt, constrained by its small economy and political instability.

Tanzania’s external debt is comparable to Kenya’s, positioning it as a major borrower in the EAC. However, its debt-to-GDP ratio and risk profile are more favorable than some peers, as discussed below.

Debt-to-GDP Ratio and Sustainability

Tanzania’s external debt-to-GDP ratio provides insight into its debt sustainability. In 2023, Tanzania’s public debt (including external and domestic) was 46.87% of GDP, with external debt accounting for approximately 70.4% of total public debt (2023 data). Assuming a nominal GDP of 78 USD Billion in 2023 (projected to grow to 105.1 USD Billion in 2022, adjusting for inflation and growth), the external debt of 34,056 USD Million in March 2025 translates to roughly 32-35% of GDP, depending on GDP estimates for 2025.

• Comparison with African Peers:
  • South Africa: External debt at 168,379 USD Million with a GDP of approximately 405 USD Billion (2023) yields a debt-to-GDP ratio of ~41.6%, higher than Tanzania.
  • Egypt: 155,204 USD Million with a GDP of 393 USD Billion (2023) results in a ratio of ~39.5%, also higher.
  • Nigeria: 42,900 USD Million with a GDP of 362 USD Billion (2023) gives a ratio of ~11.8%, significantly lower due to Nigeria’s larger economy.
  • Ghana: 28,300 USD Million with a GDP of 76 USD Billion (2023) results in a ratio of ~37.2%, indicating higher distress risk.
  • Rwanda: 7,916 USD Million with a GDP of 14 USD Billion (2023) yields a ratio of ~56.5%, much higher than Tanzania, indicating greater vulnerability.
• East African Context:
  • Kenya: 37,173 USD Million with a GDP of 112 USD Billion (2023) results in a ratio of ~33.2%, similar to Tanzania.
  • Rwanda: As noted, ~56.5%, significantly higher.
  • Burundi: 650 USD Million with a GDP of 2.6 USD Billion (2023) yields a ratio of ~25%, lower but less relevant due to its small economy.

Tanzania’s external debt-to-GDP ratio of ~32-35% is moderate compared to peers, and its public debt-to-GDP ratio of 46.87% (2023) is below the regional benchmark of 55% for low-income countries, indicating sustainable debt levels. The IMF’s 2024 Debt Sustainability Analysis (DSA) classifies Tanzania’s risk of external debt distress as low, supported by prudent fiscal policies and concessional borrowing.

Composition of Tanzania’s External Debt

As of December 2019, Tanzania’s external debt was USD 22.4 Billion (40% of GDP), with the central government holding 78%, the private sector 21%, and public corporations 0.4%. The debt is primarily owed to:

• Multilateral institutions: 46% (e.g., World Bank, IMF, African Development Bank)
• Commercial sources: 34%
• Export credit: 11%
• Bilateral institutions: 9% (e.g., China, India).

By currency, 68.9% of external debt is denominated in USD, followed by the Euro, which reduces exposure to currency fluctuations but increases repayment burdens when the Tanzanian shilling depreciates (8% depreciation in 2023).

Drivers of External Debt

Tanzania’s external debt growth is driven by:

1. Infrastructure Investments: Large-scale projects like the Standard Gauge Railway (SGR), Dar es Salaam Port expansion, and energy projects (e.g., gas pipeline from Mnazi Bay to Dar es Salaam) require significant borrowing.
2. Economic Diversification: Investments in mining (gold, nickel, graphite), manufacturing, and tourism to reduce reliance on agriculture.
3. COVID-19 Response: Non-concessional borrowing during the pandemic to support the economy, increasing debt levels.
4. Foreign Direct Investment (FDI): FDI rose to USD 922 Million in 2021, with projects like the Kabanga Nickel Project requiring external financing.

Risks and Challenges

• Foreign Exchange Shortages: The Tanzanian shilling’s 8% depreciation in 2023 and 0.5% in 2022 increased debt servicing costs in local currency.
• Election-Related Pressures: The 2025 elections may increase fiscal spending, potentially pausing fiscal consolidation efforts.
• Global Economic Slowdown: Reduced tourism receipts and export demand could strain debt repayment capacity.
• Debt Service Burden: Debt service absorbs ~40% of government expenditures, limiting fiscal space for social spending.

Position in Africa and East Africa

• Africa: Tanzania ranks among the top 10 African countries for external debt, behind South Africa, Egypt, and Nigeria, but its moderate debt-to-GDP ratio and low distress risk make it a relatively stable borrower. Its diversified economy (agriculture, mining, tourism) and stable political environment enhance its attractiveness for FDI, unlike higher-risk countries like Ghana or Zambia.
• East Africa: Tanzania is a close second to Kenya in external debt, with a stronger growth outlook (6% projected GDP growth in 2025 vs. Kenya’s 5%). Its lower debt-to-GDP ratio compared to Rwanda and stable macroeconomic policies position it as a regional economic powerhouse, though Kenya’s larger economy gives it a slight edge.

Conclusion

Tanzania’s external debt of 34,056 USD Million in March 2025 reflects its ambitious development agenda but remains sustainable, with a debt-to-GDP ratio of ~32-35% and low distress risk. Compared to African peers, Tanzania’s debt is moderate, and within East Africa, it competes closely with Kenya while outperforming smaller economies like Rwanda and Burundi. Continued fiscal discipline, concessional borrowing, and economic diversification will be key to maintaining debt sustainability.

This table highlights Tanzania’s external debt of 34,056 USD Million (Mar 2025) as moderate within Africa, comparable to Kenya in East Africa, and sustainable relative to its GDP. Its debt-to-GDP ratio of ~32-35% is lower than peers like Rwanda (56.5%) and Angola (59.1%), positioning Tanzania favorably in terms of debt sustainability.

Notes:

• Tanzania: External debt increased from 34,551.4 USD Million (Jan 2025) to 35,039.8 USD Million (Feb 2025), with 34,056 USD Million reported for Mar 2025. Debt-to-GDP ratio estimated at 32-35% based on projected GDP growth to ~100 USD Billion by 2025.
• Kenya: Converted from 5,057 KES Billion using 1 KES = 0.00735 USD (Dec 2024).
• Burundi: Converted from 1,873,263 BIF Million using 1 BIF = 0.000347 USD (Dec 2024).
• GDP Estimates: Sourced from IMF/World Bank 2023 data, adjusted for inflation/growth where necessary.
• Debt-to-GDP Ratio: Calculated as (External Debt / GDP) * 100. Ratios are approximate due to varying reference dates and GDP projections.

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)