#DomesticDebtMarket - TICGL | Tanzania Investment and Consultant Group Ltd

Section 1

What Is Tanzania's National Debt?

National debt refers to the total amount of money the government owes to domestic and foreign creditors. It is a critical instrument for financing national development — particularly large-scale infrastructure, social services, and economic transformation initiatives. Tanzania's debt portfolio is managed and reported by the Bank of Tanzania (BoT).

Tanzania's national debt consists of two main components: External debt — borrowed from foreign lenders including multilateral institutions, bilateral partners, and commercial creditors — and Domestic debt — borrowed within Tanzania from local banks, pension funds, and investors through government securities.

Total National Debt (Jan 2026)

USD 51,079.8M

≈ TZS 132.8 Trillion

Monthly Change

+0.1%

From December 2025

Exchange Rate (Applied)

~TZS 2,600

Per 1 USD

Debt Sustainability (PV/GDP)

~40.7%

Threshold: 55%

📋 Tanzania External Debt Overview — January 2026

Indicator	Amount (USD Million)	Approx. TZS Trillion	Status
Total External Debt Committed	40,781.1	106.0	Committed
Disbursed Outstanding Debt (DOD)	35,750.7	93.0	Active / In Use
Undisbursed Debt	5,554.4	14.4	Pipeline
Total National Debt	51,079.8	132.8	Combined

🔎 Key Interpretation

Disbursed debt represents loans already received and actively deployed by the government. Undisbursed debt refers to loans that have been committed by lenders but not yet released — these are funds in the pipeline for future projects. January 2026 saw new disbursements of USD 122.9 million, primarily to the government, with service payments of USD 98.5 million.

Source: Bank of Tanzania Monthly Economic Review, January 2026. Exchange rate: ~TZS 2,600 per USD.

Tanzania National Debt Composition — January 2026

Distribution of external vs. domestic debt (% share of total)

External Debt: 70%

USD 35,750.7M (DOD) — owed to multilateral, bilateral, and commercial creditors abroad.

Domestic Debt: 30%

~USD 15,329.4M (TZS 38.6T) — held by commercial banks, pension funds, and other local investors.

Source: Bank of Tanzania, January 2026 Report.

Section 2

External Debt Stock by Creditor Category

Tanzania's external debt is owed to a range of creditors: multilateral development institutions, bilateral government partners, international commercial lenders, and export credit agencies. This creditor mix shapes the cost, risk, and repayment structure of the country's debt.

🌎 External Debt by Creditor — January 2026 (DOD)

Creditor Category	USD Million	Share (%)	Approx. TZS Trillion	Risk Profile
Multilateral Institutions World Bank, AfDB, IMF	20,803.5	58.2%	54.1	Low
Commercial Creditors Private / Market Lenders	12,702.7	35.5%	33.0	Medium–High
Bilateral Creditors Government-to-Government	1,526.9	4.3%	4.0	Medium
Export Credit Agencies	717.6	2.0%	1.9	Low–Medium
Total External DOD	35,750.7	100%	93.0	—

Source: Bank of Tanzania, January 2026 External Debt Report.

Creditor Breakdown — External Debt (USD Million)

Bar chart showing absolute debt held by each creditor category

📈 Share of External Debt by Creditor Type

Multilateral Institutions (World Bank, AfDB, IMF)58.2%

Commercial Creditors35.5%

Bilateral Creditors4.3%

Export Credit Agencies2.0%

🌟 Why Multilateral Dominance Matters

Multilateral loans (58.2% of external debt) from the World Bank, African Development Bank, and IMF typically carry longer repayment periods and lower interest rates than commercial borrowing. This structure provides Tanzania with a more stable debt foundation compared to markets that rely heavily on commercial creditors. However, the 35.5% commercial share is a factor requiring active monitoring.

Use of External Debt Funds

The disbursed external debt funds various sectors of Tanzania's economy:

External Debt Allocation by Sector (% of DOD)

Key sectors financed by Tanzania's external borrowing

Sector	Share of DOD (%)	Key Projects
Balance of Payments / Budget Support	22.7%	General budget financing
Transport & Telecommunications	21.8%	SGR, Roads, Airports, Port Expansion
Social Sectors / Education	19.4%	Schools, Health, Water
Energy & Mining	11.9%	Hydropower, Julius Nyerere Dam
Other Sectors	24.2%	Agriculture, Industry, Finance
Total	100%	—

Source: Bank of Tanzania sector allocation data, January 2026.

Section 3

Domestic Debt Overview

Domestic debt refers to government borrowing from local financial institutions and investors within Tanzania. The government raises domestic debt primarily through Treasury Bills (T-Bills), Treasury Bonds, and other government securities — auctioned by the Bank of Tanzania on behalf of the Ministry of Finance.

As of January 2026, domestic debt grew to TZS 38,599.6 billion — a 1.9% monthly increase, primarily driven by new government securities issuances. The securities market remains robust, with bond auctions oversubscribed by as much as 34% for 10-year bonds at a yield of 11.30%.

Total Domestic Debt

TZS 38,599.6B

January 2026

Monthly Growth

+1.9%

From Dec 2025

Securities Issued (Jan)

TZS 263.7B

Mobilized in January 2026

10-Year Bond Yield

11.30%

Auction oversubscribed by 34%

🏠 Government Domestic Debt by Holder — January 2026

Creditor / Holder	Amount (TZS Billion)	Share (%)	Role in Economy
Commercial Banks	10,902.5	28.5%	Primary market participants; use bonds for liquidity management
Pension Funds	10,389.5	27.1%	NSSF, PPF — long-term savings matched to long-term bonds
Bank of Tanzania	7,436.0	19.4%	Monetary policy; BoT holds non-securitized debt
Other Investors	7,128.9	18.6%	Corporates, SACCOs, individual retail investors
Insurance Companies	2,005.0	5.2%	Regulatory requirement to hold government securities
Total Domestic Debt	38,599.6	100%	—

Source: Bank of Tanzania Domestic Debt Statistics, January 2026.

Domestic Debt Holders — Distribution

By holder type (TZS Billion)

Domestic Debt by Instrument

Bonds dominate at 80.4% of domestic portfolio

Domestic Debt Instruments

Instrument	Amount (TZS Billion)	Share (%)	Typical Tenor
Treasury Bonds	31,015.1	80.4%	2 – 25 Years
Treasury Bills (T-Bills)	1,821.4	4.7%	91, 182, 364 Days
Non-Securitized Debt	5,763.1	14.9%	Various
Total	38,599.6	100%	—

Source: Bank of Tanzania, January 2026.

✅

Strong Domestic Market Signal: The oversubscription of bond auctions (34% for 10-year bonds) indicates strong investor confidence in Tanzania's government securities. This depth in the domestic market reduces dependence on external borrowing and provides a stable, lower-cost financing channel — a positive indicator for debt management.

Section 4

Trend of Tanzania External Debt (2025–2026)

Tanzania's external debt has followed a generally increasing trajectory over recent years, driven by financing of large-scale national infrastructure projects. However, the January 2026 data reveals that the actual disbursed outstanding debt (DOD) reflects a more measured pace of increase compared to committed debt.

📈 External Debt Trend — 2025 to January 2026

Disbursed Outstanding Debt (DOD) in USD Billion with trend line overlay

🕑 External Debt Historical Data Points

Period	External DOD (USD Billion)	Approx. TZS Trillion	Monthly Change (%)
January 2025	36.6	95.2	Baseline
December 2025	35.3	91.8	▼ −3.6% (YTD to Dec)
January 2026	35.8	93.0	▲ +0.6%

🔎

Note on Committed vs. Disbursed Debt: The committed external debt figure of USD 40,781.1 million (as per the primary BoT document) is higher than the disbursed outstanding debt of USD 35,750.7 million. The difference — USD 5,554.4 million (TZS 14.4 trillion) — represents funds in the pipeline that have been approved but not yet drawn down by Tanzania.

Source: Bank of Tanzania Monthly Reports, January 2025 – January 2026.

Key Drivers of Debt Increase

External borrowing has been primarily directed toward major strategic national investments:

🚃 Transport Infrastructure

The Standard Gauge Railway (SGR) remains the largest single debt-financed project, alongside road construction, airport upgrades, and expansion of the Dar es Salaam Port — collectively representing 21.8% of external debt use.

⚡ Energy & Power

The Julius Nyerere Hydropower Project (2,115 MW) and other energy infrastructure projects account for 11.9% of external debt, supporting Tanzania's goal of affordable energy access and industrial growth.

🏫 Social Sectors

Education, health, and water and sanitation projects represent 19.4% of external debt use, reflecting Tanzania's commitment to human capital development alongside physical infrastructure.

📈 Budget Support

22.7% of disbursed external debt goes toward balance of payments and direct budget support — helping stabilise government finances during periods of fiscal stress or commodity price fluctuations.

Section 5

Composition of Tanzania's Total National Debt

Combining external and domestic debt, Tanzania's total national debt as of January 2026 stands at USD 51,079.8 million (TZS 132.8 trillion). The composition reveals a strong external weighting, which shapes both the country's development financing strategy and its exposure to global financial conditions.

Total National Debt Composition — USD & TZS (January 2026)

Side-by-side comparison of external vs. domestic debt in both currencies

📋 Tanzania National Debt Composition — Full Breakdown

Debt Type	USD Million	TZS Trillion	Share (%)	Primary Holders
External Debt (DOD)	35,750.7	93.0	70.0%	World Bank, AfDB, Commercial Banks
Domestic Debt	~15,329.4	39.9	30.0%	Commercial Banks, Pension Funds, BoT
Total National Debt	51,079.8	132.8	100%	—

Source: Bank of Tanzania, January 2026. Domestic USD figure inferred from TZS 39.9T at ~TZS 2,600/USD.

🌎 External Debt Deep Dive

External debt at USD 35.75 billion represents 70% of the national total. Key characteristics:

Committed: USD 40,781.1M (includes pipeline)
Disbursed: USD 35,750.7M (active)
Largest creditor: Multilateral (58.2%)
Jan 2026 disbursements: +USD 122.9M
Jan 2026 servicing: −USD 98.5M
Net Jan change: +USD 524M (+0.6%)

🏠 Domestic Debt Deep Dive

Domestic debt at TZS 38,599.6 billion (30%) has grown through strong securities issuance:

Treasury Bonds: TZS 31,015.1B (80.4%)
Treasury Bills: TZS 1,821.4B (4.7%)
Non-securitized: TZS 5,763.1B (14.9%)
Monthly growth: +1.9%
Jan servicing: TZS 669.8B
Bonds oversubscribed by 34%

🔎

Structural Observation: While external debt dominates (70%), the growing domestic debt market — backed by oversubscribed bond auctions and strong institutional investor participation — is a positive sign of Tanzania's deepening capital markets. A gradual rebalancing toward domestic sources could reduce FX exposure over time.

Disclaimer: This analysis is compiled by TICGL Research Division based on publicly available Bank of Tanzania data. It is intended for informational and research purposes only. © 2026 Tanzania Investment and Consultant Group Ltd — ticgl.com

Batch 1 of 2 — Sections 1–5. Sections 6–8 (Debt Sustainability, Economic Implications, Summary) will be added in Batch 2.

Section 6

Key Indicators of Debt Sustainability

Debt sustainability assesses whether Tanzania can meet its current and future debt obligations without compromising economic stability or requiring exceptional adjustment measures. The internationally recognised framework — the IMF/World Bank Debt Sustainability Analysis (DSA) — benchmarks Tanzania's debt against key thresholds.

As of January 2026, Tanzania's debt indicators remain within sustainable bounds, though the upward trend in external debt warrants continued fiscal discipline.

PV Debt-to-GDP Ratio

40.7%

Threshold: 55%

✅ Within safe limit

Public Debt-to-GDP

~43%

Threshold: 55%

✅ Moderate & manageable

External Debt Share

70%

Target: <60% preferred

⚠️ Elevated — monitor FX risk

Multilateral Debt Share

58.2%

Higher = more concessional

✅ Favourable terms

Debt Service / Exports

~12%

Threshold: ~25%

⚠️ Rising — needs monitoring

Commercial Debt Share

35.5%

Higher = more market risk

⚠️ Watch global rate movements

📈 Tanzania Debt Sustainability Indicators vs. Thresholds

Actual levels compared to IMF/World Bank benchmark thresholds (% scale)

📋 Debt Sustainability Indicator Summary

Indicator	Tanzania (Jan 2026)	IMF/WB Threshold	Status	Trend
PV Debt-to-GDP	~40.7%	55%	✅ Safe	▲ Rising
Public Debt-to-GDP	~43%	55%	✅ Safe	▲ Rising
External Debt Share of Total	70%	<60% preferred	⚠️ Watch	▬ Stable
Multilateral Debt Share	58.2%	Higher = better	✅ Good	▬ Stable
Commercial Debt Share	35.5%	<30% preferred	⚠️ Elevated	▲ Rising
Debt Service / Exports	~12%	25% threshold	✅ Safe	▲ Rising
Shilling Depreciation (Jan)	0.97%	Mild	⚡ Monitor	▲ Gradual

Source: IMF DSA Framework; Bank of Tanzania January 2026 Report.

🎯 Overall Sustainability Assessment

Tanzania's debt profile remains sustainable — the PV Debt-to-GDP ratio of ~40.7% is well below the 55% IMF threshold, and the strong multilateral creditor composition (58.2%) provides concessional terms. However, the rising commercial debt share (35.5%) and FX exposure from a 70% external debt weighting require active monitoring and prudent fiscal management going forward. A 10% depreciation of the Tanzanian Shilling would add approximately TZS 9 trillion to the effective debt burden.

Debt Servicing — January 2026

Tanzania made the following debt service payments in January 2026:

External Debt Service

USD 98.5M

Principal + interest to foreign creditors

Domestic Debt Service

TZS 669.8B

Redemptions + coupons on government securities

Debt Service vs. New Disbursements — January 2026

Net flow: new borrowings vs. repayments (USD Million equivalent)

Section 7

Economic Implications of Tanzania's National Debt

Tanzania's national debt finances approximately 34% of the FY 2025/26 government budget (total: TZS 49.2 trillion). It underpins the country's Vision 2050 industrialisation agenda and supports a GDP growth target of 6.0–6.3% in 2026. The securities market plays an increasingly important role in managing debt risks and mobilising domestic savings.

✅ Positive Impacts

Finances SGR, roads, hydropower — adding 1.0–1.5% to GDP annually
Infrastructure drives FDI target of USD 15 billion
Projects created 160,000 jobs in 2025
Supports GDP growth of 6.5–6.9% in medium term
Strong securities market mobilised TZS 263.7B in January alone
Low domestic yields (11.30%) reduce borrowing costs
Debt/GDP at 43% enables continued credit access
Inflation remains contained at 3.2%
Projects target poverty below 20% by 2030

⚠️ Risks & Challenges

External service of USD 98.5M/month strains budget
Servicing diverts ~6.5% of government budget
10% Shilling drop adds ~TZS 9 trillion to debt cost
Commercial debt (35.5%) exposed to global rate spikes
Crowding-out risk may slow SME credit growth
External dominance (70%) creates FX vulnerability
Poverty reduction could be delayed if servicing escalates
Global shocks could trigger debt overhang deterring investment
Mild Shilling depreciation of 0.97% in January — upside risk

📈 National Debt Budget Allocation — FY 2025/26

How debt-financed spending is distributed across priority sectors (estimated % share)

📋 Economic Implications Matrix — Detailed Analysis

Implication Category	Positive Impact on Growth	Potential Risks	Link to Securities Market
Financing & Investment	Debt funds infrastructure (transport 21.8%), driving FDI (USD 15B target) and mining / agriculture growth.	Servicing USD 98.5M monthly strains budget, risking poverty reduction delays.	Oversubscription (34%) mobilises TZS 263.7B, lowering borrowing costs for development bonds.
Sustainability	Debt/GDP ~43% sustainable, enabling 6.5–6.9% medium-term GDP growth trajectory.	External debt rise (+0.6% Jan) exposes to Shilling depreciation, increasing costs ~TZS 9T per 10% drop.	Domestic focus (80.4% bonds) deepens market, attracting banks and pension funds (combined 55.6%).
Macro Resilience	Multilateral terms (58.2%) support stability — inflation at 3.2%, credit growth at 23.5%.	Commercial debt (35.5%) creates risk if global interest rates spike, slowing diversification.	Bond yields benchmark private sector rates, enhancing financial inclusion for SMEs and households.
Inclusive Growth	Infrastructure projects created 160,000 jobs in 2025; target unemployment below 13.4% and poverty below 20% by 2030.	Debt overhang could deter private investment amid global shocks, widening inequality gaps.	Securities market recycles domestic savings into growth projects, projecting resilient 6.3% GDP in 2026.

Source: Bank of Tanzania; Ministry of Finance FY2025/26 Budget; TICGL Research synthesis.

📈 Tanzania GDP Growth Rate — Actual & Projected (2022–2027)

Debt-financed infrastructure contributing to sustained growth above 6%

Section 8

Summary of Tanzania National Debt — January 2026

The following table consolidates all key national debt indicators from the Bank of Tanzania's January 2026 data, providing a single reference snapshot of Tanzania's debt position.

Indicator	Value	Currency / Unit	Notes
Total National Debt	USD 51,079.8M	TZS 132.8 Trillion	External + Domestic combined
Total External Debt (Committed)	USD 40,781.1M	TZS 106.0 Trillion	Includes undisbursed pipeline
Disbursed Outstanding Debt (DOD)	USD 35,750.7M	TZS 93.0 Trillion	Active / deployed debt
Undisbursed External Debt	USD 5,554.4M	TZS 14.4 Trillion	Committed but not yet drawn
Domestic Debt	~USD 15,329.4M	TZS 38,599.6 Billion	Up 1.9% month-on-month
External Debt Share	70.0%	% of Total	Down from 77% (attached doc baseline)
Domestic Debt Share	30.0%	% of Total	Growing via bond issuances
Largest External Creditor	Multilateral Institutions	USD 20,803.5M (58.2%)	World Bank, AfDB, IMF
Commercial Creditors	USD 12,702.7M	35.5% of external	Market-rate borrowing; highest risk tier
Bilateral Creditors	USD 1,526.9M	4.3% of external	Government-to-government loans
Export Credit Agencies	USD 717.6M	2.0% of external	Trade-linked financing
Domestic Debt — Treasury Bonds	TZS 31,015.1B	80.4% of domestic	Dominant instrument; 2–25 year tenors
Domestic Debt — T-Bills	TZS 1,821.4B	4.7% of domestic	91, 182, 364-day instruments
Largest Domestic Holder	Commercial Banks	TZS 10,902.5B (28.5%)	Followed by Pension Funds 27.1%
Public Debt-to-GDP	~43%	% of GDP	Below 55% IMF threshold
PV Debt-to-GDP (DSA)	~40.7%	% of GDP	Safe — threshold is 55%
External Debt Service (Jan 2026)	USD 98.5M	Monthly	Principal + interest payments
Domestic Debt Service (Jan 2026)	TZS 669.8B	Monthly	Redemptions + coupon payments
New External Disbursements (Jan)	USD 122.9M	Monthly inflow	Mostly to central government
Securities Mobilised (Jan 2026)	TZS 263.7B	Monthly	10-year bonds oversubscribed by 34%
Exchange Rate Applied	~TZS 2,600/USD	Conversion basis	Shilling depreciated 0.97% in January
GDP Growth Target (2026)	6.0 – 6.3%	% annual	Supported by debt-financed infrastructure

Source: Bank of Tanzania Monthly Economic Review, January 2026; Ministry of Finance; TICGL Research Division.

📈 Tanzania Debt Structure at a Glance — January 2026

All major debt components visualised on a single stacked chart (TZS Trillion)

✅ Conclusion

Data from the Bank of Tanzania report confirms that Tanzania's national debt has grown steadily, reaching USD 51,079.8 million (TZS 132.8 trillion) as of January 2026 — primarily driven by large-scale investments in infrastructure and economic transformation under Vision 2050.

Key features of Tanzania's debt profile include:

External debt dominates at 70% — reflecting reliance on foreign financing for major projects such as the SGR, Julius Nyerere Hydropower, and port expansion.
Multilateral lenders are the largest creditors (58.2%) — providing concessional terms that support long-term sustainability.
Domestic debt is growing rapidly — driven by oversubscribed bond auctions, with TZS 263.7 billion mobilised in January 2026 alone.
Debt remains sustainable — PV Debt-to-GDP at ~40.7% is comfortably below the 55% IMF threshold.
FX risk is real but contained — mild Shilling depreciation (0.97% in January) and careful monetary policy support stability.
Growth trajectory is positive — debt-financed infrastructure supports a 6.0–6.3% GDP growth target for 2026, with medium-term potential of 6.5–6.9%.

Despite the growth in public debt, Tanzania continues to maintain moderate and sustainable debt levels relative to GDP. The deepening domestic securities market — evidenced by oversubscribed auctions and growing institutional investor participation — positions Tanzania for increasingly self-reliant development financing. Prudent fiscal management, however, remains essential to preserving this trajectory.

Section 01 — Currency Stability

Tanzania Shilling Exchange Rate Trends

The stability of the Tanzania Shilling is most directly measured by its exchange rate against the US dollar (USD). In early 2026, the Shilling showed moderate, well-managed depreciation — reflecting balanced monetary policy by the Bank of Tanzania (BoT) amidst global commodity price pressures and domestic liquidity dynamics.

By March 2026, the average exchange rate hovered around TZS 2,554 per USD, fluctuating in the range of TZS 2,550–2,609. The annual depreciation rate of just 0.97% is a strong signal that Tanzania's foreign exchange management remains effective.

TZS/USD Exchange Rate — Jan 2025 to Mar 2026

Source: Bank of Tanzania | Monthly Average Exchange Rates

Detailed Exchange Rate Data

Period	Exchange Rate (TZS per USD)	Monthly Change (%)	Notes
Jan 2025	2,486.6	—	Baseline stability amid low inflation
Jun 2025	2,604.6	+4.7%	Peak depreciation due to seasonal imports
Sep 2025	2,442.8	−6.2%	Recovery from export gains (gold)
Dec 2025	2,447.5	+0.2%	End-year stability
Jan 2026	2,518.1	+2.9%	Slight rise linked to debt payments
Mar 2026 (Avg)	2,554.7	+1.4%	Fluctuated TZS 2,550–2,609; moderate pressure

Key Insight: Despite seasonal peaks (Jun 2025: TZS 2,604.6/USD), the Shilling self-corrected to TZS 2,442.8 by September 2025 — underpinned by strong gold and agricultural export revenues. Reserves of USD 6.3 billion (~5 months import cover) provide a robust buffer against external shocks.

Section 02 — Debt Overview

Tanzania National Debt Overview (January 2026)

At the end of January 2026, Tanzania's total national debt stood at approximately TZS 128.6 trillion (USD 51.1 billion) — a modest 0.1% increase from the previous month. The debt is split between external obligations and domestic borrowing, with external debt accounting for 70% of the total.

National Debt Composition

External vs. Domestic — Jan 2026

Debt Stock by Category

TZS Trillion — January 2026

Debt Category	Amount (TZS)	Amount (USD)	Share of Total
External Debt	≈ TZS 90.0 trillion	≈ USD 35.8 billion	70%
Domestic Debt	TZS 38.6 trillion	≈ USD 15.3 billion	30%
Total National Debt	≈ TZS 128.6 trillion	USD 51,079.8 million	100%

Section 03 — Domestic Borrowing

Growth of Domestic Debt (2018–2026)

Domestic borrowing has grown substantially over the past eight years, driven by the government's need to finance infrastructure, energy, and budget deficits. From TZS 13,618.8 billion in 2018, domestic debt nearly tripled to TZS 38,599.6 billion by January 2026 — an increase of 183% over eight years.

The most rapid acceleration occurred between 2020 and 2023, coinciding with COVID-19 recovery spending and accelerated public infrastructure investment. In January 2026 alone, domestic debt grew by 1.9% month-on-month.

Government Domestic Debt Growth Trend (2018–2026)

TZS Billion | Source: Bank of Tanzania

Year / Period	Domestic Debt (TZS Billion)	Year-on-Year Growth (%)	Total National Debt (TZS Trillion)
2018	13,618.8	—	—
2020	14,637.8	+7.5%	—
2022	21,256.1	+45.2%	—
2023	26,494.6	+24.6%	—
2024	31,002.6	+17.0%	—
2025	37,899.0	+22.2%	—
Jan 2026	38,599.6	+1.9% (MoM)	128.6

Notable: The jump from TZS 14,637.8B (2020) to TZS 21,256.1B (2022) — a 45.2% spike — reflects significant post-pandemic fiscal stimulus. Growth has since moderated, signalling improved fiscal discipline.

Section 04 — Debt Instruments

Composition of Domestic Debt by Instrument

The majority of Tanzania's domestic debt is raised through government securities — primarily long-term Treasury Bonds, which provide stable, cost-effective financing for development projects. As of January 2026, government bonds accounted for an overwhelming 80.4% of total domestic debt.

Domestic Debt by Instrument

Percentage Share — Jan 2026

Domestic Debt by Instrument

TZS Billion Values — Jan 2026

Instrument	Amount (TZS Billion)	Share of Total	Purpose
Government Bonds	31,015.1	80.4%	Long-term development financing
Treasury Bills	1,821.4	4.7%	Short-term liquidity management
Non-securitised Debt	5,627.3	14.6%	Budget support obligations
Other Liabilities	0.1	~0%	Miscellaneous
Total Domestic Debt	38,599.6	100%	—

Why bonds dominate: Treasury Bonds provide long-dated, fixed-rate financing that matches the timeline of Tanzania's infrastructure projects (hydropower, transport, etc.) and reduce rollover risk compared to short-term Treasury Bills.

Section 05 — Creditor Base

Major Holders of Government Domestic Debt

Tanzania's domestic debt market is anchored by institutional investors — particularly commercial banks and pension funds, which together hold more than 55% of all government domestic securities. This broad-based creditor structure reduces concentration risk and reflects strong confidence in Tanzanian government paper.

Domestic Debt Holders — Share by Creditor Type

As at January 2026 | Source: Bank of Tanzania

Creditor	Amount (TZS Billion)	Share	Significance
Commercial Banks	10,902.5	28.5%	Largest single creditor group
Pension Funds	10,389.5	27.1%	Long-term domestic savings mobilised
Bank of Tanzania	7,436.0	19.4%	Monetary policy operations
Insurance Companies	2,005.0	5.2%	Asset-liability matching
Other Investors	7,128.9	18.6%	Retail & institutional diversification

Section 06 — External Obligations

External Debt Structure

Tanzania's external debt of ~TZS 90 trillion (≈ USD 35.8 billion) is predominantly owed to multilateral development institutions. Multilateral lenders — including the World Bank, African Development Bank, and IMF — account for 58.2% of external debt, offering concessional terms that reduce debt servicing pressure.

Commercial creditors hold 35.5% of external debt, signalling Tanzania's growing access to international capital markets — though this also introduces higher refinancing risk.

External Debt by Creditor Type

Percentage Share — Jan 2026

External Debt — TZS Trillion

Values by Creditor — Jan 2026

Creditor Type	Amount (TZS Trillion)	Share	Loan Terms
Multilateral Institutions	~TZS 52.0T	58.2%	Concessional (low interest, long maturity)
Commercial Creditors	~TZS 31.7T	35.5%	Market rates — higher servicing cost
Bilateral Creditors	~TZS 3.8T	4.3%	Government-to-government, mixed terms
Export Credit	~TZS 1.8T	2.0%	Tied to specific trade financing

Risk Note: The 35.5% share of commercial creditors is a key risk factor. A global interest rate spike or credit rating downgrade could significantly increase Tanzania's external debt servicing costs, putting pressure on foreign exchange reserves.

Section 07 — Macroeconomic Linkages

The Debt–Currency Relationship

There are several transmission channels through which Tanzania's debt profile affects the stability of the Shilling. Understanding these linkages is critical for investors, policymakers, and business planners operating in Tanzania.

Factor	Effect on the Shilling	Current Status
Increase in external debt	Higher demand for foreign currency to repay loans → depreciation pressure	Monitored
Debt servicing payments	Draws down foreign exchange reserves → potential weakening of TZS	Managed
Domestic borrowing via securities	Absorbs domestic liquidity → reduces inflationary pressure on TZS	Positive
Strong export revenues (gold, agriculture)	Generates USD inflows → supports TZS appreciation	Positive
USD 6.3B forex reserves (~5 months import cover)	Provides buffer against external shocks → stabilises TZS	Positive
FDI inflows (USD 11B in 2025)	Boosts FX supply → reduces depreciation pressure	Positive

The net result of these forces is that Tanzania's Shilling has remained relatively stable in early 2026 — annual depreciation of just 0.97% confirms that the positive factors (strong exports, adequate reserves, FDI inflows) are outweighing the debt-related pressures.

Key Stability Indicators at a Glance — January 2026

Composite view of Tanzania's monetary and fiscal health metrics

Section 08 — Development Impact

Economic Implications for Growth & Development

Tanzania's monetary and fiscal conditions in early 2026 present a mixed but broadly optimistic picture for economic development. Low inflation (3.2%), a stable exchange rate, and targeted public investment are driving a projected 6.0–6.3% GDP growth for 2026 — among the highest in Sub-Saharan Africa.

However, risks persist: rising external debt (70% of total) heightens foreign exchange vulnerability — a 10% TZS depreciation could raise debt servicing costs by approximately TZS 9 trillion, crowding out social spending and potentially increasing poverty rates.

Implication Category	Positive Impact on Growth	Potential Risks	Link to Securities Market
Currency Stability	Stable TZS (0.97% depreciation) aids exports (gold, agriculture up 10%), boosting 6.2% growth	External debt servicing demands USD, risking 2–5% further depreciation if reserves dip	Oversubscribed auctions (e.g., 34% for 10-year bonds) absorb liquidity, stabilising TZS without BoT intervention
Debt Sustainability	Debt-to-GDP ~40.6%, funds infrastructure (TZS 15.24 trillion planned 2026/27), driving 160,000 jobs created in 2025	Rising to 50% by 2027 could deter FDI if "debt overhang" reduces investor confidence	Domestic securities (80% bonds) cut external reliance, keeping debt service at 6.5% of budget, freeing funds for development
Macroeconomic Resilience	Low inflation (3.2%) and CBR (5.75%) support credit growth (20.3% in 2025), aiding SMEs and diversification	Global shocks (e.g., oil prices) could amplify debt pressures, slowing IMF-projected 6.3% growth	Bond yields (11.3%) benchmark private rates, enhancing financial deepening (~15% GDP market size)
Inclusive Development	Funds Vision 2050 (industrialisation, poverty cut), with agriculture/mining driving 6–7% Q1 growth	High debt diverts from social services, risking unemployment (13.4%) and inequality	Institutional investors (banks/pensions hold 55%) recycle savings into growth, but crowding out could hurt SMEs if yields rise

Tanzania GDP Growth & Debt-to-GDP Outlook (2022–2027)

GDP Growth Rate (%) vs Debt-to-GDP Ratio (%) | Projections post-2025

Section 09 — Summary

Conclusion & Outlook

✅ TICGL Summary Verdict

Data from the Bank of Tanzania's March 2026 report confirms that Tanzania's national debt continues to increase — particularly through external borrowing. Despite this growth, the Tanzania Shilling remains relatively stable, with only moderate depreciation of 0.97% annually.

Tanzania's foreign exchange management is relatively effective, supported by USD 6.3 billion in reserves
External borrowing remains within manageable levels — debt-to-GDP of ~40.6% sits well below the 55% IMF threshold
Controlled inflation (3.2%), active monetary policy (CBR at 5.75%), and adequate FX market liquidity all contribute to Shilling stability
The government securities market is a key stabilising mechanism — mobilising domestic savings (80% through bonds) reduces external vulnerability
GDP growth of 6.0–6.3% projected for 2026, driven by mining, construction, agriculture, and ongoing economic reforms
With prudent revenue mobilisation, medium-term GDP growth of 6.5–6.9% is achievable

Overall, Tanzania's balanced debt management via the government securities market has kept Shilling pressures low, positioning the country for resilient and sustained economic growth. Analysts note a moderate external debt distress risk, but ongoing reforms and strong export performance provide meaningful buffers.

Investors and business operators in Tanzania should monitor Bank of Tanzania monthly reports, foreign exchange reserve levels, and auction participation rates as leading indicators of Shilling stability and fiscal health.

11.30%

10-Yr Bond Yield

January 2026 Auction

TZS 2,869B

IBCM Turnover

January 2026

34%

Bond Oversubscription

Jan 2026 10-Yr Auction

73.2%

7-Day Interbank Share

Dominant Tenor

5.75%

Central Bank Rate

BoT CBR Q1 2026

6.3%

GDP Growth Forecast

Tanzania 2026

Section 01

Government Securities Market — Overview

The Government Securities Market is where the Tanzanian government raises domestic funds by issuing Treasury Bills (short-term) and Treasury Bonds (long-term) through competitive auctions conducted by the Bank of Tanzania (BoT). It serves as the primary mechanism for non-inflationary budget financing and development project funding.

As of early 2026, Tanzania's government securities market exhibits remarkable resilience: auctions remain consistently oversubscribed, yields have stabilized within the 9–12% range, and institutional demand continues to grow — reflecting investor confidence underpinned by stable inflation at 3.2% and projected GDP growth of 6.0–6.3%.

Key Context Tanzania's domestic debt stock reached TZS 38,114.8 billion in October 2025 (~17% of GDP), with Treasury Bonds comprising ~70% of the total, reflecting a deliberate strategy toward longer-duration, more stable financing.

Main Market Instruments

📋

Treasury Bills

Maturity: 35 · 91 · 182 · 364 Days

Short-term government debt instruments used for liquidity management and immediate budget financing. Auctioned weekly by the Bank of Tanzania via competitive bidding.

🏛️

Treasury Bonds

Maturity: 2 – 25 Years

Long-term government securities issued to finance development projects: infrastructure, hydropower, roads, and agriculture. Provide stable, predictable debt servicing costs.

Typical Buyers of Government Securities

Commercial Banks

Pension Funds

Insurance Companies

Institutional Investors

Why the Government Securities Market Matters

Importance of Government Securities Market in Tanzania
Function	Explanation	Impact
Government Financing	Supports budget deficits and development projects without printing money	High
Monetary Policy Tool	Used by Bank of Tanzania (BoT) for open-market liquidity management	High
Benchmark Interest Rate	Treasury yields serve as reference rates for loans, mortgages, and other instruments	Medium
Safe Investment Asset	Low-risk option for institutional investors — pension funds, banks, insurers	Medium
Debt Sustainability	Reduces reliance on external (foreign currency) borrowing, mitigating FX risk	High

Source: Bank of Tanzania; TICGL Analysis 2026

Section 02

Treasury Bills — Auction Performance

Treasury Bill auctions are conducted weekly by the Bank of Tanzania across four tenors: 35-day, 91-day, 182-day, and 364-day instruments. From October 2025 through January 2026, every auction was oversubscribed, a clear signal of sustained institutional confidence in short-term government paper.

Yields edged slightly upward from the 9–10% range in October 2025 to 11–12% by January 2026 — a reflection of tightening liquidity conditions and evolving market expectations ahead of the central bank's policy decisions. Crucially, this yield movement occurred within an orderly market, with the government consistently absorbing its full tender each auction cycle.

Treasury Bills Auction Results (Oct 2025 – Jan 2026)

Month	Tender Size (TZS Bn)	Bids Submitted (TZS Bn)	Successful Bids (TZS Bn)	Wtd. Avg. Yield	Oversubscription
Oct 2025	~560	~740	~560	9.0 – 10.0%	+32%
Nov 2025	~560	~720	~560	~10.0%	+29%
Dec 2025	~560	~800	~560	~11.0%	+43%
Jan 2026	~560	~840	~560	11.0 – 12.0%	+50%

Source: Bank of Tanzania Auction Reports, TICGL compilation. Bids submitted and tender sizes are approximations based on BoT data.

Treasury Bills: Demand vs. Tender Size & Yield Trend

Monthly auction performance — Oversubscription and weighted average yield movement

Oct 2025 – Jan 2026

Bid Oversubscription Rate — Monthly Trend

Percentage by which bids submitted exceeded the government's tender size

Investor Demand Indicator

✅ Key Observation Every Treasury Bill auction from October 2025 to January 2026 was oversubscribed — meaning the market offered more funds than the government required. This indicates exceptionally high investor confidence in Tanzanian government debt instruments. The rise in oversubscription from ~32% (Oct 2025) to ~50% (Jan 2026) signals deepening domestic capital markets.

Section 03

Treasury Bonds — 10-Year Auction Analysis

Alongside the weekly Treasury Bill auctions, the Bank of Tanzania conducts periodic Treasury Bond auctions for longer tenors ranging from 2 to 25 years. These bonds are critical instruments for financing Tanzania's long-term development agenda — hydropower, roads, industrial zones, and social infrastructure.

The January 2026 10-year Treasury Bond auction stands as a landmark result: oversubscribed by approximately 34%, with a weighted average yield of 11.30% — a borrowing cost that remains favorable by regional standards. The high demand reflects growing pension fund and insurance company allocations to domestic long-duration paper.

10-Year Treasury Bond Auction — January 2026

Indicator	Value (TZS Billion)	Interpretation
Tender Size	144.6	Government's target raise for this auction
Total Bids Received	194.1	Market offered TZS 49.5 billion above the tender
Successful Bids	118.9	Government accepted below tender — managing yield levels
Weighted Average Yield	11.30%	Favorable long-term borrowing cost for the government
Oversubscription Rate	~34%	Strong institutional demand for long-duration GoT paper

Source: Bank of Tanzania, January 2026 Bond Auction Results

10-Year Treasury Bond: Tender vs. Bids vs. Successful Allocations

Visual breakdown of the January 2026 auction — government's strategic acceptance below tender

Jan 2026

Yield Comparison: Treasury Bills vs. 10-Year Treasury Bond

Tanzania's yield curve — risk-return relationship across maturities

Yield Curve Snapshot

⚠️ Strategic Note The government accepted TZS 118.9 billion — below the TZS 144.6 billion tender — to maintain favorable yield levels and avoid upward pressure on long-term borrowing costs. This disciplined approach to debt management demonstrates sound fiscal stewardship by the Ministry of Finance and BoT.

Section 04

Interbank Cash Market — IBCM Analysis

The Interbank Cash Market (IBCM) is where commercial banks lend and borrow short-term funds among themselves to manage daily liquidity positions. It serves as a critical transmission mechanism for monetary policy — interest rates here respond quickly to the Central Bank Rate (CBR) set by the Bank of Tanzania.

In January 2026, total IBCM turnover reached TZS 2,868.9 billion, a slight decline from December's TZS 3,481.9 billion — reflecting post-year-end normalisation rather than market stress. The dominant tenor was 7-day transactions, accounting for 73.2% of all interbank activity.

IBCM Market Activity — January 2026

Indicator	Value	Context
Total Market Turnover (Jan 2026)	TZS 2,868.9 Bn	Active market — supports smooth bank liquidity operations
Previous Month Turnover (Dec 2025)	TZS 3,481.9 Bn	Higher Dec activity driven by year-end liquidity demand
Month-on-Month Change	–17.6%	Normalisation post year-end, not a sign of market stress
Dominant Tenor	7-Day Transactions	Banks prefer 7-day instruments for predictable short-term management
Share of 7-Day Transactions	73.2%	Signals preference for medium short-term over overnight borrowing

Source: Bank of Tanzania Monthly Economic Review, January 2026

Interbank Transaction Tenor Breakdown

~15%

Overnight

~12%

2–6 Days

73.2%

7 Days

Chart: IBCM transaction share by tenor — January 2026. The 7-day rate serves as a benchmark indicator of overall banking system liquidity.

Interbank Cash Market — Monthly Turnover Trend

TZS Billion — estimated turnover Q4 2025 through January 2026

IBCM Activity

IBCM Transaction Structure by Tenor — January 2026

Share of interbank lending by maturity bucket

Tenor Distribution

Monetary Policy Transmission Chain

BoT Sets

CBR: 5.75%

→

IBCM Responds

7-Day Rate

→

Banks Price

Lending Rates

→

Economy

Credit Growth

Bank of Tanzania Liquidity Management Instruments

Instrument	Direction	Purpose	Effect on IBCM
Reverse Repo	Inject ↑	BoT buys securities from banks — adds liquidity	Pushes IBCM rate down toward CBR floor
Repo	Absorb ↓	BoT sells securities to banks — drains liquidity	Pushes IBCM rate up within policy corridor
Government Securities (OMO)	Dual	Open Market Operations — fine-tune liquidity	Anchors overnight and short-term rates
Standing Lending Facility	Emergency ↑	Emergency liquidity backstop for commercial banks	Sets ceiling on IBCM rates

Source: Bank of Tanzania Monetary Policy Framework; TICGL Analysis 2026

How Government Securities and Interbank Market Interact

🏛️ Government Securities Market

▸ Used for government borrowing and fiscal financing

▸ Provides safe, liquid investment assets for banks

▸ Influences banking system liquidity when banks buy securities

▸ Sets the benchmark yield curve for the economy

🏦 Interbank Cash Market (IBCM)

▸ Used for bank-to-bank short-term liquidity management

▸ Determines prevailing short-term interest rates daily

▸ Responds to liquidity changes caused by T-Bill purchases

▸ Transmits BoT monetary policy to the real economy

💡 The Feedback Loop Explained When banks purchase large volumes of Treasury Bills, their available cash reserves fall. To meet reserve requirements or fund daily operations, these banks then borrow from the interbank market. This raises IBCM demand and can push short-term rates higher — creating a direct feedback loop between the government securities market and interbank liquidity conditions.

Section 05

Key Market Indicators — Tanzania, January 2026

The table below synthesizes the most critical data points from Tanzania's financial markets as of January 2026, drawing from Bank of Tanzania publications and TICGL research. Together, these indicators paint a picture of a stable, well-functioning domestic financial system.

Indicator	Value	Status	Signal
Treasury Bill Demand	Oversubscribed every auction	✅ Strong	High investor confidence in short-term GoT debt
T-Bill Weighted Avg. Yield (Jan 2026)	11.0 – 12.0%	Elevated	Tight liquidity; slight upward yield pressure
10-Year Bond Yield	11.30%	✅ Stable	Favorable long-term borrowing cost
10-Year Bond Oversubscription	~34%	✅ Strong	Deep institutional appetite for long-duration GoT bonds
IBCM Turnover (Jan 2026)	TZS 2,868.9 Bn	Active	Healthy bank-to-bank liquidity trading
Dominant IBCM Tenor	7-Day	Normal	Short-term focus reflects standard liquidity management
Share of 7-Day Transactions	73.2%	Dominant	Market benchmark for system-wide liquidity
Central Bank Rate (CBR)	5.75%	✅ Stable	Accommodative stance supporting growth targets
Domestic Debt / GDP	~17%	✅ Sustainable	Well within international thresholds
Tanzania Inflation (Feb 2026)	3.2%	✅ Within Target	BoT target range: 3–5%

Source: Bank of Tanzania; National Bureau of Statistics; TICGL Research, March 2026

Tanzania Financial Market Health — Multi-Metric Overview

Composite assessment across six dimensions — January 2026 (scores are illustrative normalised ratings)

Market Dashboard

Metric	FY 2025/26	FY 2026/27 (Projected)	Assessment
Total Domestic Borrowing	~TZS 12.8 Tn	TZS 15.24 Tn	Increasing
Domestic Debt Stock	TZS 38,114.8 Bn	Est. TZS 42,000+ Bn	Manageable
Domestic Debt / GDP	~17%	~18–19%	Sustainable
Total Public Debt / GDP	~40.6%	~42%	Below 55% threshold
Debt Service / Budget	~6.5%	~7–8%	Moderate
Bonds Share of Domestic Debt	~70%	~72%	Longer-duration stability
Avg. Weighted Yield (T-Bills)	~10.8%	~11–12%	Slight upward pressure

Indicator	Value	Target / Benchmark	Status
Central Bank Rate (CBR)	5.75%	Policy corridor anchor	Accommodative
Tanzania Inflation Rate (Feb 2026)	3.2%	BoT target: 3–5%	✅ On Target
Private Sector Credit Growth (YoY)	16.1%	Target: 20%+	Below target
T-Bill Yield Serving as Benchmark	11.0–12.0%	Market lending rate reference	Elevated
Bank Holdings of Gov. Securities	~70% of IBCM assets	—	Crowding-out risk
Foreign Exchange Reserves	USD 6.3 Billion	Min. 4 months import cover	~5 months cover

Indicator	2024	2025	2026 Target	Driver
FDI Inflows	~USD 9.5 Bn	~USD 11 Bn	USD 15 Bn	Policy reforms, stable macro environment
New Investment Projects Approved	~780	927	1,000+	TIC facilitation, lower regulatory friction
Jobs from New Investments	~130,000	~160,000	180,000+	Infrastructure-led investment expansion
Household Savings Rate	~11%	~12%	13–14%	Deepening financial sector access
External Debt Share of Total Debt	~71%	~69.5%	68%	Shift toward domestic financing
Foreign Reserves (Import Cover)	~4.7 months	~5.0 months	5+ months	Strong gold & export earnings

Implication 04

Risks & Challenges — Headwinds to Sustained Growth

While Tanzania's government securities market performs strongly, it is not without risks. The primary concern is the crowding-out effect: as the government borrows more domestically to fund a projected TZS 15.24 trillion in FY 2026/27, it competes directly with private sector borrowers for the same pool of bank funds. This dynamic can constrain SME lending, slow private investment diversification, and limit youth employment opportunities.

External shocks — particularly oil price volatility and tightening global financial conditions — could raise yields beyond the current 11–12% range, increasing debt-servicing costs and squeezing fiscal space. Analysts note Tanzania's strong buffers (USD 6.3 billion reserves, stable gold export earnings) provide meaningful protection, but sustained vigilance remains essential.

Opportunities vs. Risks — Balanced Assessment

✅ Opportunities

▸ Deepening domestic capital markets through longer-tenor issuance (25-year bonds)

▸ Green bond issuance to fund climate-resilient infrastructure

▸ SME guarantee facilities funded by excess auction liquidity

▸ Pension fund diversification into productive sectors

▸ Reducing external borrowing dependence — lower FX risk

▸ Continued oversubscription signals room for larger tender sizes

⚠️ Risks

▸ Crowding out: private sector credit growth below 20% target

▸ Rising yields if global rates increase or oversubscription wanes

▸ Increasing domestic borrowing (TZS 15.24 Tn in FY 2026/27)

▸ Youth unemployment at ~13.4% if SME credit remains constrained

▸ External shocks (oil price, global liquidity shifts) could spike yields

▸ Revenue shortfalls could create vicious debt-servicing cycles

Full Economic Implication Matrix

Implication Category	Positive Impact	Potential Risk	Net Assessment
Fiscal Space	Funds 6–7% GDP growth via infrastructure; hydropower adds USD 3.5B value	Higher yields could raise servicing costs if oversubscription wanes	Net Positive
Financial Deepening	Market size ~15% GDP; attracts institutional investors; builds yield curve	Crowding out: private credit growth below 20% target, hurting SMEs	Mixed
Macro Stability	Anchors inflation at 3.2%; supports 6.3% GDP forecast; low external risk	External debt risks if global rates rise, though domestic focus mitigates	Net Positive
Investment Attraction	927 new projects in 2025 (~USD 11B); stable credit ratings; policy reforms	Youth unrest or policy gaps could deter FDI; job creation may slow	Net Positive
Monetary Policy	Effective OMO tool; inflation within target; reserves at 5 months cover	Bank-heavy holdings (~70%) risk reducing SME lending if liquidity tightens	Moderate
Debt Sustainability	Total debt-to-GDP ~40.6% — well below 55% IMF threshold	FY 2026/27 borrowing (TZS 15.24 Tn) increases pressure on sustainability	Sustainable
Employment & Inclusion	~160,000 jobs from infrastructure-linked investments in 2025	Crowding-out limits SME finance; youth unemployment persists at ~13.4%	Watch

Source: TICGL Economic Analysis; Bank of Tanzania; IMF; World Bank Tanzania Economic Update 2025

Tanzania Debt Sustainability — Key Ratios vs. Risk Thresholds

Current levels (blue) plotted against IMF/World Bank risk thresholds (red dashed). Values in % of GDP.

Debt Sustainability

Four Pillars of Economic Impact

🏗️

Infrastructure & Fiscal Financing

Domestic securities fund ~34% of the national budget, prioritizing hydropower (+1.2–1.5% GDP), roads, and industrial zones. Average borrowing cost of ~10.8% keeps debt servicing at a sustainable 6.5% of budget.

TZS 49.2 Tn — FY 2025/26 Budget Size

📉

Inflation Anchoring & Stability

BoT's use of securities for Open Market Operations keeps inflation at 3.2% within the 3–5% target. This protects household purchasing power and anchors business planning confidence across all sectors.

3.2% — Tanzania Inflation, February 2026

💰

FDI & Investment Climate

Consistent oversubscription signals macro credibility, contributing to USD 11B in FDI in 2025. Stable credit outlook and policy reforms target USD 15B by end-2026, with 927 new approved investment projects.

USD 11 Bn — Tanzania FDI Inflows, 2025

⚠️

Crowding-Out & SME Risk

Banks holding ~70% of liquid assets in government securities may limit SME credit access. Private credit growth at 16.1% remains below the 20% target. Youth unemployment at 13.4% requires urgent private-sector catalysis.

13.4% — Youth Unemployment Rate, 2025

The provided insights from the Bank of Tanzania's Monthly Economic Review (September 2025) on the Financial Markets—specifically the Government Securities Market and Interbank Cash Market (IBCM)—paint a picture of a stable and liquid financial system supporting broader economic expansion. When viewed alongside the broader context in the attached document (e.g., Q3 2025 GDP growth estimated above 6%, headline inflation at a low 3.4%, and 21% y-o-y growth in broad money supply M3), these developments signal positive momentum in Tanzania's economic development. They reflect effective monetary policy transmission, investor confidence, and fiscal resilience amid global headwinds like trade uncertainties and moderating commodity prices.

1. Government Securities Market

2. Interbank Cash Market (IBCM)

Financial Market Key Figures – Tanzania (August 2025)

Implications for Tanzania's Economic Development

1. Government Securities Market: Signs of Fiscal Confidence and Lower Borrowing Costs

2. Interbank Cash Market (IBCM): Effective Liquidity Management and Policy Transmission

These financial market dynamics imply a virtuous cycle for Tanzania's development: ample liquidity lowers costs, boosts credit and investment, and sustains 6%+ growth while keeping inflation anchored. The document's projections (stable inflation, moderate oil prices) reinforce this, with fiscal borrowing financing pro-growth spending without derailing stability. Compared to EAC peers (e.g., Kenya's higher 7-8% yields amid debt concerns), Tanzania's metrics highlight relative strength.

However, watchpoints include managing debt buildup (aim for <50% GDP) and external risks like fertilizer price spikes (elevated per Chart 1.5), which could hit agriculture (28% of GDP). The IMF's October 2025 Regional Economic Outlook praises Tanzania's policy mix but urges digital financial reforms to deepen IBCM participation. If trends hold, expect Q4 2025 growth to exceed estimates, potentially hitting 6.8% annually.

Indicator	Figure
Treasury Bills
Tender Size	TZS 163.6 billion
Bids Submitted	TZS 409.7 billion
Successful Bids	TZS 162.9 billion
Weighted Average Yield	6.83%
Treasury Bonds
15-Year Bond Tender Size	TZS 213.1 billion
25-Year Bond Tender Size	TZS 293.7 billion
Total Bids Submitted (All Bonds)	TZS 2,256.4 billion
Accepted Bids	TZS 867.7 billion
15-Year Bond Yield	13.91%
25-Year Bond Yield	14.42%
Government Borrowing – Domestic
Total Borrowed	TZS 1,644.1 billion
– of which Bonds	TZS 1,480.7 billion
– of which Treasury Bills	TZS 163.5 billion
Domestic Debt Stock (End of Aug 2025)	TZS 37,129.8 billion
Interbank Cash Market (IBCM)
Turnover – July 2025	TZS 3,746.0 billion
Turnover – Aug 2025	TZS 2,374.5 billion
Average Interest Rate – July 2025	7.35%
Average Interest Rate – Aug 2025	6.48%

Indicator	August 2025 Value	Implication for Development
T-bill Oversubscription Ratio	~2.5x (bids/tender)	High liquidity supports private sector lending (16.2% credit growth).
Bond Yield Decline	-1.3 to -1.5 ppts m-o-m	Lowers govt. interest payments by ~TZS 200-300 bn annually, aiding deficit financing at 4.5% of GDP.
Domestic Debt Stock	TZS 37,129.8 bn (+5%)	Enables growth funding but risks higher debt service (projected at 20% of revenues).

Maturity	August 2025 Rate	Implication for Development
Overnight	6.15%	Quick liquidity access aids daily trade flows, supporting 29.2% credit growth in commerce.
7-Day (60% of deals)	6.52%	Aligns with CBR, enabling sustained investment in mining/tourism exports (up per document).
91-180 Days	7.00%	Mild premium signals low risk, encouraging longer-term project finance.

What Is Tanzania's National Debt?

External Debt Stock by Creditor Category

Use of External Debt Funds

Domestic Debt Overview

Domestic Debt Instruments

Trend of Tanzania External Debt (2025–2026)

Key Drivers of Debt Increase

Composition of Tanzania's Total National Debt

Key Indicators of Debt Sustainability

Debt Servicing — January 2026

Economic Implications of Tanzania's National Debt

Summary of Tanzania National Debt — January 2026

✅ Conclusion

Tanzania Shilling Exchange Rate Trends

Detailed Exchange Rate Data

Tanzania National Debt Overview (January 2026)

Growth of Domestic Debt (2018–2026)

Composition of Domestic Debt by Instrument

Major Holders of Government Domestic Debt

External Debt Structure

The Debt–Currency Relationship

Economic Implications for Growth & Development

Conclusion & Outlook

✅ TICGL Summary Verdict

Related TICGL Economic Resources

Government Securities Market — Overview

Main Market Instruments

Typical Buyers of Government Securities

Why the Government Securities Market Matters

Treasury Bills — Auction Performance

Treasury Bills Auction Results (Oct 2025 – Jan 2026)

Treasury Bonds — 10-Year Auction Analysis

10-Year Treasury Bond Auction — January 2026

Interbank Cash Market — IBCM Analysis

IBCM Market Activity — January 2026

Interbank Transaction Tenor Breakdown

Monetary Policy Transmission Chain

Bank of Tanzania Liquidity Management Instruments

How Government Securities and Interbank Market Interact

Key Market Indicators — Tanzania, January 2026

Economic Implications — Tanzania's Growth & Development

Tanzania GDP Growth Trajectory

Financing Development Projects — Fiscal Space & Budget Support

Domestic Borrowing & Debt Metrics — Tanzania 2025/26

Monetary Policy Transmission — Stability & Inflation Control

Monetary Policy & Stability Indicators — Q1 2026

Investor Confidence — Domestic Capital Mobilisation & FDI

Tanzania FDI & Investment Confidence — Key Metrics

Risks & Challenges — Headwinds to Sustained Growth

Opportunities vs. Risks — Balanced Assessment

Full Economic Implication Matrix

Four Pillars of Economic Impact

Conclusion — Tanzania's Financial Markets in 2026

1. Government Securities Market

2. Interbank Cash Market (IBCM)

Financial Market Key Figures – Tanzania (August 2025)

Implications for Tanzania's Economic Development