Why is the number of active taxpayers falling while total registrations rise?

Registration is a cumulative stock — once issued, a Taxpayer Identification Number is rarely removed even if the holder stops filing, closes a business, or never becomes fully compliant. 'Active' status is a flow, measuring who is actually filing and paying in a specific period. A taxpayer can hold a valid TIN for years while being inactive, so the stock keeps growing even as the active flow shrinks.

Is TRA still collecting more tax revenue despite fewer active taxpayers?

Yes. TRA collected TZS 32.26 trillion in 2024/25 (103 percent of target, up 16.7 percent year-on-year) and TZS 37.95 trillion in 2025/26 (105 percent of target), even as the reported active-taxpayer count fell. This is possible because revenue growth has been driven disproportionately by large taxpayers, customs, and digital administration gains rather than by growth in the number of small, active filers.

What does the report recommend to reconcile Tanzania's tax-policy targets?

The report's six recommendations include reconciling the LTPP's 25 percent and the Presidential Commission's 22 percent tax-to-GDP targets, decoupling MSME formalisation from the domestic-revenue agenda, diagnosing the taxpayer-base contraction, applying lessons from the 2021 mobile money levy to future digital-tax design, harmonising central and local revenue instruments, and publishing exemption-by-exemption cost-benefit data.

What is Dira 2050 and what is its economic target for Tanzania?

Dira 2050 is Tanzania's Long-Term Perspective Plan (LTPP) 2026/27–2050/51, which sets out an ambition to become an Upper Middle-Income Country with a one-trillion-dollar economy and a per-capita GNI of at least USD 7,000 by 2050.

How large is Tanzania's informal sector under Dira 2050's own figures?

As of 2023, the informal sector contributed an estimated 55 percent of GDP and absorbed roughly 72 percent of the workforce (about 25.95 million people) according to TICGL's 2024 estimate, though cited estimates range as high as 80 percent of the workforce. Without intervention, the LTPP itself projects informality could rise to 58.5 percent of GDP by 2050.

What is the gap between Tanzania's perceived and formally recognised middle class?

About 12 percent of Tanzanians self-identify as middle-income, but fewer than 3 percent are formally captured as such under internationally comparable consumption-based measures — a gap of roughly nine to one between perception and formal classification.

What are the six Dira 2050 channels for direct citizen economic participation?

The six channels are: formalisation of the informal sector, cooperative transformation, asset-building and middle-class expansion, land and property-rights reform, digital economy and financial inclusion, and decentralised, citizen-led governance.

What is the four-dimensional ownership framework used in this study?

The framework assesses asset ownership, enterprise ownership, income and social-protection ownership, and voice and governance ownership — distinguishing procedural participation (being registered or enrolled) from substantive ownership (holding, controlling, and benefiting from an asset, enterprise, income stream, or decision).

Which Dira 2050 channel rates strongest on ownership, and which rates weakest?

Land and property-rights reform is the only channel rated Strong on any ownership dimension (asset ownership). Voice and governance ownership rates weakest across every channel except decentralisation itself, meaning no channel currently scores Strong on more than one ownership dimension.

Does BOT Protect Tanzania's Economy or Help Generate Its Growth?

01 — OverviewExecutive Summary

Tanzania needs its economy to grow faster than it is growing now — FYDP IV's own ambition is 10.5 percent real GDP growth by 2030/31, well above the 6.2 percent Tanzania achieved in 2025/26. The question this report asks is uncomfortable but necessary: is the Bank of Tanzania's new five-year Strategic Plan built to help deliver that faster growth, or mainly to guard against the things that could go wrong along the way?

The evidence points to a plan weighted heavily toward protection. Tanzanian banks currently hold liquidity and capital well above what regulators require — headroom that, in principle, could support significantly more lending to the real economy. Yet across the roughly 31 measurable targets in BOT's Plan, only one — credit to the private sector as a share of GDP — directly targets the expansion of credit into the economy. The remainder measure inflation control, reserve adequacy, capital buffers, payment-system reliability, and institutional capacity: all legitimate, all necessary, but all defensive in character rather than generative.

Idle balance-sheet capacity is real and measurable. A liquidity ratio of 26.88 percent against a 20 percent floor, and a capital adequacy ratio of 21.32 percent against a 14.5 percent floor, both in 2025/26, suggest Tanzanian banks could safely extend meaningfully more credit than they currently do.
BOT's own target mix is protection-heavy. TICGL's classification of the Plan's KPIs finds roughly nine targets built purely around stability buffers, ten around institutional capacity, seven around service quality and inclusion, and only one squarely aimed at credit generation.
Stability has genuinely enabled credit growth before. Tanzania's own recent history — inflation averaging 3.7 percent while credit to the private sector rose from 13.2 percent to 22.8 percent of GDP between 2021/22 and 2025/26 — shows protection and generation are not mutually exclusive; stability was a precondition, not a substitute, for credit growth.
But other developing economies show a more actively developmental model is possible. China, India and Rwanda all pair conventional stability tools with structural instruments — priority-sector lending quotas, credit guarantee schemes, targeted refinancing — that Tanzania's Plan does not yet feature in any quantified way.
The risk of over-correcting is real and documented. Zimbabwe's hyperinflation and more recent inflation and currency stress in Argentina and Turkey show what happens when growth-oriented pressure overrides monetary discipline — the answer is not to abandon protection, but to add structure, not disorder, to generation.

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Read this alongside TICGL's full review of BOT's Strategic Plan 2026/27-2030/31

This report builds directly on TICGL/TERI's line-by-line review of the Bank of Tanzania's Strategic Plan — its alignment with FYDP IV and Dira 2050, its five-year performance record, and the internal inconsistencies TICGL found in the Plan's own published targets.

Read: Does BOT's 2026/27-2030/31 Strategic Plan Support FYDP IV and Dira 2050? →

02 — Framing the QuestionTwo Models of Central Banking

Central banks worldwide sit somewhere on a spectrum between two broad philosophies, and BOT's Plan is a useful lens for locating Tanzania on that spectrum.

🛡️ The Protective Model (Conventional Inflation-Targeting)

Growth is treated as an outcome of stability, not a direct policy target
Primary tools: interest rates, reserve requirements, capital and liquidity buffers
Success is measured by inflation staying in-band and the financial system remaining sound
Assumes markets will allocate credit efficiently once stability conditions are met
Model followed by most Western central banks and, per this Plan, largely by BOT

🌱 The Developmental Model (Structural / Directed Credit)

Growth is treated as a co-equal objective alongside stability
Additional tools: priority-sector lending quotas, credit guarantee schemes, targeted refinancing windows, differentiated reserve requirements
Success is measured partly by whether credit actually reaches strategic sectors (agriculture, MSME, industry)
Assumes markets under-allocate credit to high-growth, high-risk-perception sectors without active direction
Model associated with China, India, South Korea (historically) and, increasingly, Rwanda

Where BOT's Plan sits

BOT's stated mission — to maintain price stability and financial-system integrity "for" inclusive growth — places it firmly in the protective camp, with growth positioned as a downstream consequence rather than a direct target. That is not unusual or wrong by international standards. The question TICGL raises is whether, given Tanzania's specific starting point — comfortable capital and liquidity buffers, an ambitious FYDP IV growth target, and a financing gap FYDP IV is counting on the private sector to close — a purely protective posture is still the right calibration, or whether a modest shift toward structural, disciplined generative tools would serve Tanzania better.

03 — The EvidenceTanzania's Banks Are Holding More Capacity Than Required

The clearest quantitative evidence for the "protect over generate" critique sits inside BOT's own Corporate Performance Review. Two of the financial sector's core soundness indicators are running well above their regulatory floors — capacity that, in principle, represents room for additional lending without breaching safety thresholds.

Table: Banking-sector buffers, actual (2025/26) vs regulatory minimum
Indicator	Actual, 2025/26	Regulatory Minimum	Headroom	What the headroom means
Liquidity ratio	26.88%	≥20%	+6.88 pts	Banks hold liquid assets well beyond what is needed to meet withdrawal and settlement obligations
Capital adequacy ratio	21.32%	≥14.5%	+6.82 pts	Banks could absorb substantially more loan risk before breaching capital-safety thresholds
Non-performing loan ratio	2.96%	≤5%	-2.04 pts (better than required)	Loan books are unusually clean — a sign banks may be lending conservatively rather than at their true risk-adjusted capacity

⚠ Headroom figures are illustrative, calculated directly from BOT's own published baseline and target/floor figures; they indicate directional capacity, not a precise lending multiplier, since capital and liquidity requirements interact with asset-quality and risk-weighting rules not fully disclosed in the Plan.

Idle Balance-Sheet Capacity: Actual vs Regulatory Floor

Percent — the gap between what banks hold and what regulation requires is capacity that is not being converted into credit

A caveat TICGL wants to be clear about

Excess liquidity and capital are not automatically "wasted" capacity — some buffer above the regulatory minimum is normal and prudent, especially given Tanzania's exposure to external shocks (commodity prices, geopolitical disruption to trade routes) documented elsewhere in BOT's own Situation Analysis. The point is not that banks should run at the regulatory floor, but that a gap this wide, sustained across a full plan period, is worth actively investigating rather than treated as a given.

04 — Counting the TargetsHow Many of BOT's Own Targets Actually Aim at Growth?

To move this argument beyond impression, TICGL classified all measurable KPIs in BOT's Strategic Plan (excluding the GDP growth rate itself, which is an outcome indicator rather than a policy lever) into five categories, based on what each target is actually designed to achieve.

Classification of BOT's ~31 Measurable KPIs by Function

TICGL's own categorisation, based on the stated intent of each KPI in the Strategic Plan

Table: TICGL's classification of BOT's KPIs
Category	Approx. Count	Example KPIs
Stability & protective buffers	9	Core & headline inflation, IBCM rate stability, foreign reserves, capital adequacy, NPL ratio, liquidity ratio, Financial System Stability Index
Institutional capacity building	10	AI Maturity Index, IT Maturity, data-management maturity, risk maturity, ESG integration, employee satisfaction, expenditure coverage ratio
Service quality & inclusion	7	Payment-system availability, TanFiX, % adults with accounts, customer satisfaction, currency durability and stock, climate-guideline compliance
Market-deepening (indirect generation)	3	Spread in the 7-day IBCM rate, spread in the IFEM, share of non-traditional debt issuance
Direct credit generation	1	Credit to the private sector as a percentage of GDP

The honest reading of this mix

This is not necessarily a design flaw — a central bank's core job genuinely is disproportionately about safeguarding rather than allocating capital, and most of Tanzania's peers show a similar KPI mix. But it does mean that if Tanzania wants BOT to play a larger role in actively generating growth, that would require a deliberate expansion of the market-deepening and direct-generation categories, not something that happens automatically from the stability targets already in place.

05 — The Other Side of the ArgumentStability Has Genuinely Enabled Credit Growth Before

Before concluding that BOT should pivot hard toward a developmental model, it is worth acknowledging what Tanzania's own recent record shows: the protective approach has not been a drag on credit growth — if anything, it appears to have been a precondition for it.

Inflation Stability and Private-Sector Credit Growth, 2021/22-2029/30

Left axis: headline inflation (%, stayed within the 3-5% band); right axis: credit to private sector as % of GDP (rose steadily as inflation stabilised)

The case for the protective model

Between 2021/22 and 2025/26, inflation averaged 3.7 percent, well inside target, while credit to the private sector nearly doubled as a share of GDP. Non-performing loans fell from 9.68 percent to 2.96 percent over the same period. A bank confident that inflation and asset quality are under control is more willing to lend — stability arguably did more for credit growth than any single directed-lending scheme could have, by making lending itself less risky.

The limit of that argument

Correlation is not the whole story. Credit growth from 13.2 percent to 22.8 percent of GDP, while real, still leaves Tanzania well below the 30-45 percent typical of fast-growing lower-middle-income peers, and well below what FYDP IV's private-financing ambitions ultimately require. Stability created the conditions for credit growth; it did not, on its own, close the gap to where Tanzania needs to be — which is exactly where structural, targeted tools could plausibly add something stability alone has not yet delivered.

06 — Comparative EvidenceHow Other Central Banks Balance Protection and Generation

Tanzania is not choosing between two untested extremes. Both cautionary and constructive examples exist among developing and emerging economies.

🇿🇼 Zimbabwe: The Cautionary Extreme

Zimbabwe's central bank financed government deficits and directed lending without monetary discipline through the 2000s, producing hyperinflation that peaked above a billion percent in 2008. It stands as the clearest warning that growth-oriented monetary tools without fiscal and institutional discipline can destroy the very economy they aim to grow.

🇦🇷 🇹🇷 Argentina & Turkey: Political Pressure on Rate Policy

Both countries saw central banks pressured to cut interest rates to stimulate growth even as inflation ran high, contributing to currency instability and elevated inflation that ultimately hurt the lower-income households growth-oriented policy was meant to help. The lesson: generation without disciplined sequencing undermines itself.

🇨🇳 China: Structural Directed Credit

The People's Bank of China pairs conventional tools with structural monetary-policy instruments — targeted relending facilities, differentiated reserve requirements for banks that lend to small firms, and directed credit toward strategic sectors such as green industry and technology — layered on top of, not instead of, price and financial stability management.

🇮🇳 India: Mandated Priority-Sector Lending

The Reserve Bank of India requires banks to direct a fixed share of total lending to designated priority sectors — agriculture, MSMEs, affordable housing, export credit — regardless of where banks would otherwise choose to lend, converting balance-sheet capacity into targeted credit by regulation rather than by hoping the market allocates it there.

🇷🇼 Rwanda: Credit Guarantees at Tanzania's Own Income Level

The National Bank of Rwanda has backed dedicated credit-guarantee facilities for SMEs and agriculture, directly addressing the collateral and risk-perception barriers that keep banks from lending to exactly the sectors Tanzania's own FYDP IV prioritises — a lower-middle-income example closer to Tanzania's starting point than China or India.

🇹🇿 Tanzania: Structural Tools Are Named, Not Yet Quantified

BOT's own Plan references an "Independent Credit Guarantee Co-operation of Tanzania" it intends to help operationalise, and a new "Strategic Investment Subsidiary" for balance-sheet diversification — both structurally similar to the Rwanda and China models above. Neither, however, carries a quantified target, baseline, or KPI in the published Plan, leaving their scale and ambition undefined.

The pattern across all six cases

Every example where directed credit worked — China, India, Rwanda — paired it with continued, disciplined attention to inflation and financial stability; it was never a substitute for the protective mandate, only an addition to it. Every example where growth-oriented pressure overrode monetary discipline — Zimbabwe, Argentina, Turkey — ended in currency and price instability that hurt growth more than it helped. For Tanzania, the evidence points toward addition, not replacement: keep the protective architecture BOT already runs well, and add quantified, disciplined structural tools on top of it.

07 — TICGL AnalysisSo, Should BOT Do More to Generate Growth?

TICGL's answer is yes, with a specific and disciplined scope — not a wholesale rewrite of BOT's mandate.

1. The credit-to-GDP target should not stand alone

BOT's target of credit to the private sector reaching 30 percent of GDP by 2029/30 is a genuinely strong ambition, but it is a single aggregate number that says nothing about which sectors receive that credit. Without sub-targets — agriculture, MSME, health and education-adjacent enterprise — the headroom identified in Section 3 could just as easily flow toward low-risk, already-well-served corporate borrowers as toward the sectors FYDP IV and Dira 2050 most need financed.

2. Quantify the two structural tools already named in the Plan

The Independent Credit Guarantee Co-operation of Tanzania and the Strategic Investment Subsidiary are the closest things in BOT's Plan to genuine developmental instruments. Both currently have implementation initiatives but no KPI, baseline, or target — the single highest-value addition BOT could make to this Plan without changing its core mandate.

3. Idle capacity deserves its own tracked metric

TICGL recommends BOT publish and track a simple "lending headroom" indicator — the gap between actual and required liquidity and capital ratios — as a standing KPI. Making idle capacity visible is the first step to deciding, transparently, whether it should be converted into credit, and for whom.

4. Tanzania's own history argues for addition, not replacement

The 2021/22-2025/26 record shows stability and credit growth moved together, not in tension — the strongest evidence in the Plan that a purely protective posture is not actively hostile to growth. The case for change is not that protection has failed, but that it has already done its job well enough that Tanzania can now afford to layer targeted, disciplined generative tools on top of it without repeating Zimbabwe's or Argentina's mistakes.

TICGL's bottom line

BOT should not choose between protecting and generating — the evidence from both Tanzania's own record and its developmental-central-bank peers shows the two are complementary when generation is structural and disciplined, not when it substitutes for monetary discipline. The specific, actionable shift TICGL recommends is narrow: quantify the credit-guarantee and strategic-investment vehicles already named in the Plan, disaggregate the private-sector-credit target by priority sector, and publish idle-capacity as a tracked metric — three additions that would move BOT from a purely protective posture toward a disciplined developmental one, without touching its core price-stability mandate at all.

08 — TICGL RecommendationsA Disciplined Path Toward a More Generative BOT

Set a quantified target and timeline for the Independent Credit Guarantee Co-operation of Tanzania — currently named as an initiative with no KPI, this is the single clearest gap between BOT's stated intentions and its measurable commitments.
Disaggregate the 30-percent credit-to-GDP target by priority sector (agriculture, MSME, health/education-adjacent enterprise, green industry), so the target's success can be judged on reach as well as scale.
Publish a standing "lending headroom" indicator tracking the gap between actual and required liquidity and capital ratios, to make idle balance-sheet capacity visible and debatable rather than implicit.
Give the Strategic Investment Subsidiary a defined mandate and KPI for balance-sheet diversification into strategic projects, rather than leaving its scale undefined in the published Plan.
Study Rwanda's credit-guarantee model specifically, given its closer income-level comparability to Tanzania than China or India, as the most directly transferable example of disciplined, structural directed credit.

09 — Quick AnswersFrequently Asked Questions

Is the Bank of Tanzania's mandate to protect the economy or to grow it?

Formally, to protect: BOT's mission treats growth as an outcome of price and financial-system stability rather than a direct policy target. Only about one in thirty of its measurable KPIs directly targets credit expansion into the economy.

Do Tanzanian banks have spare capacity to lend more?

The numbers suggest yes — a liquidity ratio of 26.88 percent against a 20 percent regulatory floor, and capital adequacy of 21.32 percent against a 14.5 percent floor, both in 2025/26, indicate headroom that is not fully converted into credit.

What is developmental central banking?

An approach where central banks add structural tools — priority-sector lending quotas, credit guarantees, targeted refinancing — to their conventional stability mandate, actively directing credit toward strategic sectors, as practised to varying degrees by China, India and Rwanda.

What are the risks of a central bank pushing growth too aggressively?

Zimbabwe's hyperinflation and inflation/currency stress in Argentina and Turkey show that growth-oriented pressure without monetary discipline can destabilise the economy it aims to grow — the case for generative tools depends on them being structural and disciplined, not a substitute for stability management.

10 — MethodologySources & Notes

Bank of Tanzania — Strategic Plan 2026/27-2030/31 (June 2026): Corporate Performance Review, Plan at a Glance KPI tables, and Theme 1-3 objectives and initiatives (bot.go.tz).
TICGL/TERI companion analysis: "Does BOT's 2026/27-2030/31 Strategic Plan Support FYDP IV and Dira 2050?" and "What's Next for Tanzania's Economy? The Policy Gaps Keeping $1 Trillion Out of Reach by 2050."
Comparative central-bank practice: publicly documented approaches of the People's Bank of China (structural monetary policy tools), the Reserve Bank of India (priority-sector lending norms), and the National Bank of Rwanda (SME and agriculture credit-guarantee facilities).
Historical reference cases: documented accounts of Zimbabwe's 2007-2009 hyperinflation episode and central-bank rate-policy pressure in Argentina and Turkey, cited for illustrative comparative purposes.
KPI classification (Section 4) is TICGL/TERI's own analytical categorisation of BOT's published targets and is presented as interpretation, not as BOT's own framing.
This page is an independent analytical summary prepared by TICGL/TERI and does not constitute financial, investment, tax, or legal advice.

Muhtasari

Muhtasari kwa Kiswahili

Je, BOT Inalinda Uchumi wa Tanzania, au Inausaidia Kuzalisha Ukuaji? Benki za Tanzania zinashikilia mtaji na ukwasi zaidi ya kiwango kinachohitajika kisheria — uwiano wa ukwasi ni asilimia 26.88 dhidi ya kiwango cha chini cha asilimia 20, na uwiano wa mtaji ni asilimia 21.32 dhidi ya kiwango cha chini cha asilimia 14.5. Kati ya malengo zaidi ya 31 yaliyowekwa kwenye Mpango Mkakati wa BOT, moja tu — mikopo kwa sekta binafsi kama asilimia ya GDP — linalenga moja kwa moja kuongeza mikopo kwenye uchumi. Mengine yote yanahusu ulinzi wa uthabiti, uwezo wa taasisi, na huduma bora, si "kuzalisha" moja kwa moja.

Uchambuzi wa TICGL unaonyesha kwamba uthabiti wa fedha umekuwa msingi muhimu uliowezesha ukuaji wa mikopo hapo awali — mfumuko wa bei ulipobaki thabiti kati ya 2021/22 na 2025/26, mikopo kwa sekta binafsi yaliongezeka kutoka asilimia 13.2 hadi 22.8 ya GDP. Hii inaonyesha kulinda na kuzalisha si mambo yanayopingana — lakini historia ya nchi kama Zimbabwe (mfumuko wa bei uliozidi asilimia bilioni moja mwaka 2008) na shinikizo la kisiasa kwenye benki kuu za Argentina na Uturuki zinaonyesha hatari za kusukuma ukuaji bila nidhamu ya kifedha.

Nchi kama China, India na Rwanda zinaonyesha njia ya kati — zinatumia zana za "directed credit" (mikopo inayoelekezwa kimkakati kwa sekta maalum kama kilimo na MSME) sambamba na uthabiti wa fedha, si badala yake. BOT tayari imetaja vyombo viwili vinavyofanana na mifano hii — Independent Credit Guarantee Co-operation ya Tanzania na Strategic Investment Subsidiary — lakini bado havina malengo ya kiasi (targets) yaliyowekwa wazi. TICGL inapendekeza BOT iweke malengo dhahiri kwa vyombo hivi, igawe lengo la mikopo kwa sekta binafsi kulingana na sekta za kipaumbele, na ichapishe kiashiria cha "uwezo wa mikopo usiotumika" kama sehemu ya ufuatiliaji wa umma.

Uwiano wa ukwasi wa benki: 26.88% (zaidi ya kiwango cha chini cha 20%)
Uwiano wa mtaji wa benki: 21.32% (zaidi ya kiwango cha chini cha 14.5%)
Malengo ya "kuzalisha" moja kwa moja kwenye Mpango wa BOT: 1 tu kati ya 31
Mikopo kwa sekta binafsi: kutoka 13.2% (2021/22) hadi 22.8% (2025/26), lengo la 30% ifikapo 2029/30

Vyanzo: Mpango Mkakati wa Benki Kuu ya Tanzania 2026/27-2030/31, uchambuzi wa awali wa TICGL/TERI kuhusu FYDP IV na Dira 2050, na mifano ya kimataifa ya benki kuu za maendeleo. Uchambuzi umeandaliwa na Idara ya Utafiti ya TICGL / Tanzania Economic Research Institute (TERI).

01 — OverviewExecutive Summary

Every national development plan needs a stable macroeconomic floor to stand on. FYDP IV's ten-sector transformation agenda and Dira 2050's US$1 trillion, US$7,000-per-capita ambition both assume low inflation, a credible exchange rate, adequate reserves, and a financial sector willing and able to lend. That floor is precisely what the Bank of Tanzania's (BOT) Strategic Plan 2026/27-2030/31, published June 2026 to mark the Bank's 60th anniversary, is designed to deliver. This report reads the Plan against two questions: does it genuinely align with FYDP IV and Dira 2050, and is it ambitious and credible enough to protect Tanzania's growth over the next five years.

On alignment, the answer is a clear yes on paper — BOT's own strategy map lines its three thematic areas up directly against Dira 2050's pillars and FYDP IV's competitiveness agenda. On ambition and credibility, the picture is more mixed. BOT's five-year track record from 2021/22 to 2025/26 was strong: most monetary and financial-stability targets were met or exceeded, sometimes by a wide margin. But several of the new 2029/30 targets are set below levels BOT has already achieved, several key figures are inconsistent between different tables in BOT's own document, and the headline GDP growth target sits below what FYDP IV itself is asking for.

The previous plan mostly over-delivered. Inflation stayed inside the 3-5 percent band, GDP growth hit 6.2 percent against a 6 percent target, and credit to the private sector reached 22.8 percent of GDP, just above target — while capital adequacy, non-performing loans, and payment-system reliability all beat their targets comfortably.
The new plan's boldest number is private-sector credit. BOT wants credit to the private sector to climb from 22.8 percent to at least 30 percent of GDP by 2029/30 — a genuinely stretching target that, if achieved, would materially expand the financing available to the private investment FYDP IV is counting on.
Some targets are floors, not stretch goals. Capital adequacy (target ≥14.5% vs an actual 21.32%), the non-performing loan ratio (≤5% vs an actual 2.96%), and foreign reserve cover (≥4.0 months vs an actual 4.7) are all set below what BOT already achieved in 2025/26 — sensible as regulatory minimums, but not evidence of rising ambition on their own.
The document contradicts itself on two important numbers. The detailed KPI table sets GDP growth at ≥7.2 percent and foreign investment income at ≥20bps above the Strategic Asset Allocation (SAA) target; BOT's own summary infographic later in the same document shows 6.0 percent and 10bps respectively — a gap TICGL flags for BOT and readers alike.
Institutional and climate capacity building is the least visible but most structural theme — AI maturity, data governance, ESG integration and emissions reduction targets that matter for whether BOT can execute the rest of the Plan at all.

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Read this alongside TICGL's flagship Dira 2050 policy-gaps analysis

This report is best read together with TICGL/TERI's wider assessment of the policy gaps standing between Tanzania and Dira 2050's US$1 trillion, US$7,000-per-capita ambition by 2050 — the financing, productivity and institutional gaps that BOT's monetary and financial-stability mandate must help close from the macro side.

Read: What's Next for Tanzania's Economy? The Policy Gaps Keeping $1 Trillion Out of Reach by 2050 →

02 — ContextWhat Is the BOT Strategic Plan 2026/27-2030/31?

The Plan is BOT's fifth-generation corporate strategy, published in June 2026 under Governor and Board Chairman Emmanuel Mpawe Tutuba, coinciding with the Bank's 60th anniversary (1966-2026). It restates BOT's mission — to maintain price stability and the integrity of the financial system for inclusive economic growth — and sets out a results-based framework built predominantly on the Management by Objectives (MBO) methodology, partly supplemented by the Balanced Scorecard (BSC) technique and a Performance Measurement Process (PuMP®) for tracking execution.

Seven Key Strategic Focus Areas

Enhancing Monetary Policy and Price Stability
Deepening Domestic Financial Markets and Foreign Reserve Opportunities
Strengthening Financial Stability, Inclusion, Payment Systems and Regulation
Enhancing Digital Transformation, Data Governance and Operational Resilience
Promoting Climate Change Resilience and Sustainability
Enhancing Institutional Excellence
Improving Gender Equality and Diversity

Three Thematic Areas, Six Strategic Objectives

Theme 1 — Macroeconomic Stability: monetary policy effectiveness, foreign reserves, deepening domestic financial markets.
Theme 2 — Stability of the Financial Sector: financial-sector safety and inclusiveness, banking and currency services, climate resilience.
Theme 3 — Organizational Capacity: institutional efficiency, organisational effectiveness and sustainability.

Each objective carries defined intended results, KPIs, a 2026/27 baseline, a 2029/30 target, and a named strategic initiative with an assigned departmental "champion" responsible for delivery.

The Governor's framing

In his foreword, Governor Tutuba reports that the outgoing 2021/22-2025/26 plan achieved and, in his words, surpassed its objectives: core and headline inflation averaged 2.9 percent and 3.1 percent respectively, the exchange rate was managed through external pressure, foreign reserves were strengthened partly through domestic gold purchases, and real GDP growth averaged 5.5 percent. The new Plan is framed as building on that record while adding a new Artificial Intelligence and Data Management strategy and a stronger climate-resilience agenda, developed against a backdrop of rising global geopolitical risk.

Structurally, the document also discloses BOT's capital works pipeline: two multi-year construction projects (Bank Officers' Apartments and Senior Staff Housing Apartments, both in Kigoma, on a design-and-build basis) plus a further sixteen new projects for 2026/27 alone, split evenly between construction and ICT — a reminder that institutional capacity building sits alongside monetary policy as a genuine budget line, not an afterthought.

03 — Policy AlignmentHow the Plan Maps Onto FYDP IV and Dira 2050

BOT's own alignment diagram is unusually explicit for a central bank strategy document: it draws direct lines from each of its three thematic areas to specific national frameworks, rather than gesturing at alignment in prose alone.

Table: BOT thematic areas mapped to national development frameworks
National Framework	Core National Priority	BOT Thematic Area It Feeds
Dira 2050 / Tanzania Vision 2050	Strong, inclusive and competitive economy; human capabilities and social development; environmental integrity and climate resilience	Macroeconomic Stability; Stability of the Financial Sector
FYDP IV 2026/27-2030/31	Re-energising competitiveness and industrialisation for human development	Macroeconomic Stability (credit growth, reserves, market depth)
Zanzibar Development Vision 2050 / ZADEP	Upper-middle-income status via sustainable, inclusive human development; blue economy	Stability of the Financial Sector (inclusion, banking services)
Financial Sector Development Master Plan 2020/21-2029/30	Strengthen science, technology and innovation capacity across production, manufacturing and services	Stability of the Financial Sector
National Financial Inclusion Framework 2023-2028	Broaden access to affordable, quality financial services	Stability of the Financial Sector (inclusion KPIs)
NDC / National Environmental Policy / Climate Change Response Strategy	Climate resilience; ESG principles in supervision and operations; climate-resilient financing	Stability of the Financial Sector (climate objective); Organizational Capacity (ESG, emissions)

Where the alignment is strongest

The clearest link runs through Theme 1. FYDP IV's growth and industrialisation agenda depends on a stable shilling, contained inflation, adequate reserves, and — critically — a banking sector willing to extend credit at scale. BOT's monetary-policy and financial-market-deepening objectives target exactly those inputs, and its 70 percent-private-financing assumption for FYDP IV infrastructure (documented in TICGL's companion analysis on infrastructure and human-capital spending) is only credible if private-sector credit genuinely expands the way BOT's Plan targets it to.

Where the alignment is more implicit than operational

Human capital and social development is one of FYDP IV's five co-equal national priorities, yet BOT's Plan engages with it only indirectly, through financial inclusion (percentage of adults with accounts, the Tanzania Financial Inclusion Index) rather than through any direct link to health, education or skills financing. That is a reasonable division of labour for a central bank, but it means BOT's Plan alone cannot answer the infrastructure-versus-human-capital budget question TICGL examines elsewhere — it only sets the financing conditions under which that debate plays out.

04 — The Track RecordHow Did the 2021/22-2025/26 Plan Actually Perform?

Before judging the new Plan's ambition, it helps to see how BOT's previous five-year plan performed against its own targets. The Bank's Corporate Performance Review (Q3 2025/26 data) shows a strong record on macroeconomic and financial-stability metrics, with two notable misses.

Table: Selected KPIs, 2021/22-2025/26 plan — baseline vs target vs actual (Q3 2025/26)
Indicator	Baseline (2021/22)	Target (2025/26)	Actual (Q3 2025/26)	Result
Core inflation	2.1%	3% - 5%	3.4%	Within band ✓
Headline inflation	3.6%	3% - 5%	4.2%	Within band ✓
GDP growth rate	4.5%	≥6%	6.2%	Exceeded ✓
Credit to private sector / GDP	13.2%	≥22%	22.8%	Exceeded ✓
7-day IBCM rate stability	None (n/a)	±200bps of CBR	±200	Met ✓
Months of import cover	6.1	≥4.0	4.7	Met ✓ (but declined)
Capital adequacy ratio	17.20%	≥14.5%	21.32%	Exceeded ✓
Asset quality (NPL ratio)	9.68%	≤5%	2.96%	Exceeded ✓
Liquidity ratio	32.90%	≥20%	26.88%	Met ✓ (but declined)
Payment system reliability	98% (2023/24)	≥98%	99.97%	Exceeded ✓
Financial Inclusion Index	0.69 (2024/25)	≥0.74	0.83	Exceeded ✓
% of adults with bank accounts	60% (2023)	80%	73.80%	Below target ✗
EFT settlement period	T+1	T+0	T+1	Not met ✗
Customer satisfaction, banking & currency services	76%	80%	96.90%	Exceeded ✓
Compliance with BOT climate/sustainability guidelines	31%	40%	40%	Met exactly ✓

⚠ Figures are Q3 2025/26 actuals as reported in BOT's Corporate Performance Review; some Theme 3 (Organizational Capacity) figures in BOT's own summary tables render with partial overlaps and are treated qualitatively rather than quoted precisely in this report.

Previous Plan: Baseline vs Target vs Actual, Core Macro Indicators

GDP growth, credit-to-private-sector, and import cover — 2021/22 baseline vs 2025/26 target vs Q3 2025/26 actual

Inflation: Baseline vs Actual (Q3 2025/26)

Percent — both measures stayed inside the 3-5% target band

Financial Soundness: Baseline vs Actual (Q3 2025/26)

Percent — capital adequacy and NPL ratio, 2021/22 vs Q3 2025/26

The headline takeaway

Of the fifteen indicators tracked here, twelve were met or exceeded, often comfortably. The financial sector's underlying soundness improved sharply — non-performing loans fell from 9.68 percent to 2.96 percent, and total banking assets nearly doubled over the period, according to BOT's own Situation Analysis. That is the strongest evidence in the Plan that BOT can execute what it commits to, and it is the basis on which the new 2029/30 targets should be judged.

05 — The New CommitmentsWhat BOT Is Targeting by 2029/30

The new Plan resets baselines to 2026/27 opening figures and sets fresh targets for 2029/30 (the Plan's fourth year, one year short of its formal 2030/31 close, per BOT's own "Plan at a Glance" tables). The clearest way to read these is theme by theme.

Theme 1 — Macroeconomic Stability

Table: Theme 1 KPIs — baseline vs 2029/30 target
Objective	KPI	Baseline	Target 2029/30
Monetary Policy Effectiveness	Core inflation rate	2.2%	3% - 5%
Monetary Policy Effectiveness	Headline inflation rate	3.4%	3% - 5%
GDP growth rate	6.2%	≥7.2%
7-day IBCM rate stability	±200 bps	±150 bps of CBR
Credit to private sector / GDP	22.8%	≥30%
Foreign Reserves	Months of import cover	4.7	≥4.0
Foreign Reserves	Foreign investment income	39 bps above SAA target	≥20 bps above SAA target
Domestic Financial Markets	Spread in 7-day IBCM rate	1.6%	≤2%
	Spread in IFEM	TZS 57	≤TZS 20
	Share of non-traditional debt issuance	0%	≥10%

Credit to the Private Sector: The Plan's Boldest Target

Credit to private sector as a percentage of GDP — 2021/22 baseline, 2025/26 actual, 2029/30 target

Theme 2 — Stability of the Financial Sector

Table: Theme 2 KPIs — baseline vs 2029/30 target
Objective	KPI	Baseline	Target 2029/30
Safety, Efficiency, Soundness & Inclusiveness	Capital adequacy ratio	21.32%	≥14.5%
	Asset quality (NPL) ratio	2.96%	≤5%
	Liquidity ratio	26.88%	≥20%
	Financial System Stability Index	0.3	Within ±3
	Availability of Systemically Important Payment Systems	99.97%	99.9%
	Tanzania Financial Inclusion Index (TanFiX)	0.83	≥0.75
	% of adults with transactable accounts	78.3%	87%
Banking & Currency Services	Customer satisfaction level	96.2%	98%
	Currency durability (higher denomination)	2 years	2.4 years
	Currency stock level (unissued)	31 months	≥24 months
Climate Resilience	Compliance with BOT climate/sustainability guidelines	40%	75%

Financial Sector Soundness Targets vs Current Position

Percent — capital adequacy, NPL ratio and liquidity ratio: baseline (already achieved) vs the regulatory-minimum 2029/30 target

Financial Inclusion: Baseline vs 2029/30 Target

Percent of adults with transactable accounts and TanFiX index (scaled ×100 for comparability)

Theme 3 — Organizational Capacity

Table: Theme 3 KPIs — baseline vs 2029/30 target
Objective	KPI	Baseline	Target 2029/30
Institutional Efficiency	Expenditure coverage ratio	1.9	1
	Strategic Management Maturity Level	Level 3	Level 4
	% achievement of strategic result	81.5%	98%
	AI Maturity Index	1.5	≥3
	IT Maturity Level	Level 3	Level 4
	% employee satisfaction with work environment	78%	90%
Organizational Effectiveness & Sustainability	Risk maturity level	Level 3	Level 5
	Net risk level	Yellow	Green
	% ESG integration	15%	≥50%
	Bank's GHG emissions level	7,594.13 tCO₂e (100%)	4,936.18 tCO₂e (65%)

Digital & Institutional Maturity: Baseline vs Target

Maturity levels (approx. 1-5 scale) — AI, IT and data-management maturity

Governance & ESG: Baseline vs Target

Percent — legal/regulatory compliance, stakeholder satisfaction and ESG integration

Bank of Tanzania's Own Carbon Footprint: Reduction Target

Tonnes of CO₂-equivalent (tCO₂e) — baseline vs 2029/30 target, per BOT's Theme 3 KPI table

06 — Reading the Fine PrintWhere BOT's Own Tables Disagree With Each Other

A close read of the Plan turns up several places where the detailed "Plan at a Glance" KPI tables (pages 7-9) do not match the summary infographic later in the same document ("Bank's Key Performance Indicators and Targets by 2030/31", page 28). TICGL flags these not to discredit the Plan — its underlying direction is sound — but because published targets should be internally consistent, and readers relying on any single page of the source PDF could come away with a different number.

Table: Discrepancies between BOT's detailed KPI tables and its summary infographic
Indicator	Detailed table (pp. 7-9)	Summary infographic (p. 28)	Implication
GDP growth rate target	≥7.2%	6.0%	A more than one percentage point gap on the Plan's single most-watched macro number
Foreign investment income target	≥20 bps above SAA	10 bps above SAA	Materially different ambition for reserve-management returns
Legal & regulatory compliance target	95%	100%	Minor, but a compliance target should not be ambiguous
Bank's emissions-reduction target	65% of baseline remains (≈35% cut)	≤35% of baseline (≈65% cut)	Nearly doubles the implied ambition depending on which figure is used

Why this matters for external readers

Investors, development partners and researchers who cite a single BOT target risk quoting the wrong one. TICGL recommends BOT publish a single reconciled KPI annex — the Plan's own Companion Document, referenced but not included in the main Plan, may already resolve some of these gaps, and TICGL will update this analysis if and when that document becomes publicly available.

07 — Institutional Self-AssessmentBOT's Own SWOC Analysis

BOT's Situation Analysis includes a candid Strengths-Weaknesses-Opportunities-Challenges (SWOC) assessment, which is useful context for judging how realistic the Organizational Capacity targets are.

Strengths

Strong working environment supporting staff productivity and retention
Competent, experienced, committed personnel with solid governance practices
Reliable ICT systems and interoperable payment infrastructure
Strategically located branches and robust operational frameworks
Proactive monetary policy framework and diversified foreign reserves

Weaknesses

Inadequate risk-management culture and handling of strategic-project and sustainability risks
ICT infrastructure insufficient to fully support operations
Slow adoption of global standards and technological innovation
Aging infrastructure, limited office space and security concerns
Inefficient processes and generational-diversity challenges causing delays

Opportunities

Stable political and economic environment supports policy implementation
Technological innovation and expanding financial-service networks
Strong government support and stakeholder collaboration
Access to international training and global best practice
Gold reserves, diversified investments and rising investor participation

Challenges

Rising cyber threats and fraud risk to financial stability
Global financial-market volatility and external shocks complicating policy
Data unreliability and rapid technological change
Structural issues: dollarization, market segmentation, high borrowing costs
Climate-change risk and still-limited financial inclusion

The connecting thread

Nearly every listed weakness and challenge — inadequate risk culture, insufficient ICT, dollarization, cyber risk, data unreliability — maps directly onto a Theme 3 KPI in the new Plan (risk maturity, IT maturity, AI maturity, data-management maturity). That is a good sign: BOT appears to be building its 2029/30 targets around problems it has itself already diagnosed, rather than setting generic aspirational goals.

08 — TICGL AnalysisSo, Will This Plan Protect Tanzania's Growth?

Putting the pieces together — the alignment mapping, the strong prior track record, the new targets and the internal inconsistencies — TICGL's assessment is that the Plan is a credible, well-aligned foundation for FYDP IV and Dira 2050, with three qualifications that matter for how it should be read.

1. Macro stability is necessary but not sufficient for FYDP IV

Low inflation, adequate reserves and deep financial markets are the conditions private capital needs before it will commit to the PPPs and FDI that FYDP IV's 70:30 financing model depends on, as TICGL's companion infrastructure-versus-human-capital analysis sets out. BOT's Plan supplies those conditions; it cannot, on its own, guarantee the PPP pipeline or private appetite actually materialises.

2. The credit-to-GDP target is the single biggest lever

Lifting credit to the private sector from 22.8 percent to 30 percent of GDP by 2029/30 would be a genuine structural shift for an economy where dollarization and market segmentation still push up borrowing costs, per BOT's own SWOC. If achieved, it materially widens the pool of financing available for both infrastructure and human-capital-adjacent private investment (health facilities, ed-tech, agribusiness) — arguably a more powerful lever for inclusive growth than any single BOT KPI.

3. The GDP growth target undershoots FYDP IV's own ambition

FYDP IV's headline target is 10.5 percent real GDP growth by 2030/31 (per TICGL's FYDP IV research); BOT's detailed table targets ≥7.2 percent — and its own summary infographic shows just 6.0 percent. Central-bank growth targets are typically set conservatively to preserve credibility, but the gap between BOT's figures and FYDP IV's headline number is wide enough that either FYDP IV's growth ambition, or BOT's own monetary stance, may need to be reconciled publicly.

4. Several "targets" are really floors, and that is fine — but should be labelled as such

Capital adequacy, NPL ratio, liquidity ratio and import cover are all set at levels BOT has already surpassed. These read less as ambition for 2029/30 and more as regulatory minimums BOT will not allow itself to fall below — a legitimate risk-management stance, but worth distinguishing clearly from genuinely stretching targets like the credit-to-GDP or AI-maturity goals, so external readers do not mistake a floor for a forecast.

TICGL's bottom line

BOT's Strategic Plan 2026/27-2030/31 is structurally well-aligned with FYDP IV and Dira 2050 and builds on a genuinely strong five-year delivery record. It is likely to protect — rather than drive — Tanzania's growth: its job is to keep inflation, the exchange rate and the financial system stable enough that FYDP IV's growth and private-financing ambitions have a fighting chance, not to generate that growth itself. Whether Tanzania hits FYDP IV's 10.5 percent growth ambition depends far more on fiscal policy, the PPP pipeline, tax-to-GDP expansion and human-capital investment — the levers examined in TICGL's other FYDP IV research — than on anything within BOT's own mandate.

09 — TICGL RecommendationsGetting the Most Out of BOT's Plan

Publish a single reconciled KPI table resolving the GDP growth, foreign-investment-income, compliance and emissions discrepancies between the detailed tables and the summary infographic, ideally as a published erratum or via the referenced Companion Document.
Distinguish regulatory floors from stretch targets in future public communication — capital adequacy, NPL and liquidity minimums serve a different purpose than the credit-to-GDP or AI-maturity targets and should be presented differently to avoid understating the Plan's genuine ambition.
Publish an explicit reconciliation between BOT's GDP growth target and FYDP IV's 10.5 percent headline ambition, so investors and development partners are not left guessing which growth figure is the operative national target.
Track private-sector credit growth by sector (agriculture, MSME, infrastructure-adjacent, health/education-adjacent) so the 30-percent-of-GDP target can be assessed not just on scale but on whether it reaches the sectors FYDP IV and Dira 2050 most need financed.
Report AI Maturity Index and Risk Maturity Level progress annually and publicly, given how directly these targets map onto the cyber, data-reliability and risk-culture weaknesses BOT itself identified in its SWOC analysis.

10 — Quick AnswersFrequently Asked Questions

What is the Bank of Tanzania's Strategic Plan 2026/27-2030/31?

BOT's five-year corporate strategy covering monetary policy, foreign reserves, financial markets, financial-sector stability, banking services, climate resilience and organisational capacity, explicitly aligned with FYDP IV and Dira 2050.

Does BOT's Strategic Plan align with FYDP IV and Dira 2050?

Yes, structurally — BOT's own alignment diagram maps its three thematic areas directly onto Dira 2050's pillars and FYDP IV's competitiveness agenda, with BOT's price and financial-stability mandate forming the macroeconomic base those plans depend on.

What GDP growth does BOT's plan target by 2029/30?

The detailed KPI table sets a target of at least 7.2 percent, though BOT's own summary infographic later in the document shows a lower 6.0 percent figure for the same indicator — an inconsistency TICGL flags for clarification.

Did BOT meet its previous five-year targets from 2021/22 to 2025/26?

Largely yes. Inflation stayed within target, GDP growth and credit to the private sector both beat target, and capital adequacy, NPL and payment reliability were all exceeded. The EFT settlement-time target and the share of adults with bank accounts were the two clear misses.

What is the biggest target BOT has set for credit to the private sector?

Credit to the private sector reaching at least 30 percent of GDP by 2029/30, up from 22.8 percent in 2025/26 — one of the most consequential targets in the Plan for private financing of FYDP IV.

11 — MethodologySources & Notes

Bank of Tanzania — Strategic Plan 2026/27-2030/31 (June 2026), including the Foreword, Situation Analysis, Corporate Performance Review 2021/22-2025/26, SWOC Analysis, Plan at a Glance KPI tables, and Bank's Key Performance Indicators and Targets by 2030/31 summary (bot.go.tz).
TICGL/TERI prior research: "What's Next for Tanzania's Economy? The Policy Gaps Keeping $1 Trillion Out of Reach by 2050," "Infrastructure vs Human Capital: Where Is Tanzania's Budget Really Going?," and TICGL's FYDP IV budget series.
Ministry of Finance Tanzania — FY2026/27 Budget context and FYDP IV framework documents, as cross-referenced in TICGL's related analyses.
This page is an independent analytical summary prepared by TICGL/TERI based on BOT's published Strategic Plan document and does not constitute financial, investment, tax, or legal advice. Figures reflect BOT's own reporting as published; where BOT's document contains internal inconsistencies, both figures are disclosed.

Muhtasari

Muhtasari kwa Kiswahili

Je, Mpango Mkakati wa BOT wa 2026/27-2030/31 Unaunga Mkono FYDP IV na Dira 2050? Benki Kuu ya Tanzania (BOT) imezindua Mpango Mkakati wa miaka mitano (2026/27-2030/31) unaolenga kudumisha uthabiti wa bei, kuimarisha mfumo wa fedha, na kuongeza mikopo kwa sekta binafsi kutoka asilimia 22.8 hadi angalau asilimia 30 ya Pato la Taifa (GDP) ifikapo 2029/30. Mpango huu umeunganishwa moja kwa moja na Dira 2050 na Mpango wa Nne wa Maendeleo wa Taifa (FYDP IV), ukiwa msingi wa kiuchumi unaohitajika ili malengo ya uwekezaji na ukuaji yaweze kufikiwa.

Uchambuzi wa TICGL unaonyesha kuwa katika miaka mitano iliyopita (2021/22-2025/26), BOT ilifanikiwa kufikia — na mara nyingi kuzidi — malengo yake mengi: mfumuko wa bei ulibaki ndani ya wigo wa asilimia 3-5, ukuaji wa GDP ulifikia asilimia 6.2 (zaidi ya lengo la asilimia 6), na mikopo kwa sekta binafsi ilifikia asilimia 22.8 ya GDP. Hata hivyo, malengo mapya ya 2029/30 yana changamoto kadhaa: baadhi ya malengo (kama uwiano wa mtaji wa benki na akiba ya fedha za kigeni) ni chini ya kiwango ambacho BOT tayari imekifikia, na kuna tofauti kati ya jedwali la kina la malengo (linaloonyesha ukuaji wa GDP wa angalau asilimia 7.2) na muhtasari wa mwisho wa hati hiyo (unaoonyesha asilimia 6.0 tu) — jambo ambalo TICGL inapendekeza BOT ilifafanue.

Uchambuzi wa TICGL unahitimisha kuwa Mpango wa BOT ni msingi imara na unaoendana vizuri na Dira 2050 na FYDP IV, lakini jukumu lake ni "kulinda" ukuaji wa uchumi kwa kudumisha uthabiti wa fedha, si "kuuzalisha" ukuaji huo. Kufikiwa kwa lengo kuu la FYDP IV la ukuaji wa asilimia 10.5 kunategemea zaidi sera za kibajeti, mfumo wa ubia wa umma na binafsi (PPP), upanuzi wa mfumo wa kodi, na uwekezaji kwenye maendeleo ya watu — maeneo yanayochambuliwa kwa kina katika tafiti nyingine za TICGL kuhusu FYDP IV.

Mikopo kwa sekta binafsi: kutoka asilimia 22.8 (2025/26) hadi lengo la angalau asilimia 30 ifikapo 2029/30
Ukuaji wa GDP: lengo la angalau asilimia 7.2 (jedwali la kina) dhidi ya asilimia 6.0 (muhtasari wa mwisho) — tofauti inayohitaji ufafanuzi
Mfumuko wa bei: lengo la kubaki ndani ya wigo wa asilimia 3-5
Akiba ya fedha za kigeni: lengo la miezi angalau 4.0 ya uagizaji bidhaa

Vyanzo: Mpango Mkakati wa Benki Kuu ya Tanzania 2026/27-2030/31 (Juni 2026), na utafiti wa awali wa TICGL/TERI kuhusu FYDP IV na Dira 2050. Uchambuzi umeandaliwa na Idara ya Utafiti ya TICGL / Tanzania Economic Research Institute (TERI).

01 — OverviewExecutive Summary

Every Tanzanian budget season revives the same quiet argument inside ministries, in Bunge debate, and among development partners: does the next shilling build a road, a railway and a power plant, or does it build a classroom, a clinic and a water point? This report puts numbers behind that argument. It compares Tanzania's spending on infrastructure (construction, transport, energy) against its spending on human capital (health, education, water) from 2020/21 through the 2026/27 budget — the opening year of the Fourth Five-Year Development Plan (FYDP IV, 2026/27-2030/31) — and benchmarks Tanzania's underlying human development indicators against upper-middle-income countries (UMIC), the income class Dira 2050 aims to reach by 2050.

The picture is not a simple story of neglect. Health and water budgets have grown far faster than infrastructure budgets in percentage terms since 2020/21. But infrastructure still commands the larger absolute share of Tanzania's development spending, and the underlying human capital deficit — a 63:1 teacher-pupil ratio, 1.34 doctors per 10,000 people, a World Bank Human Capital Index Plus score of 133 out of 325 — remains severe enough to threaten the productivity gains FYDP IV and Dira 2050 are counting on. This report also looks outward: how did South Korea, China, Vietnam, Rwanda and Ethiopia sequence their own infrastructure and human-capital investments on the way to faster growth, and what, if anything, should Tanzania borrow from their experience.

Infrastructure still leads in absolute terms. Construction, transport and energy ministries together commanded roughly TZS 7.09 trillion in 2020/21 and an estimated TZS 7.8-7.9 trillion in 2026/27 — still larger than confirmed health, water and education-ministry spending combined.
Human capital is growing faster, from a smaller base. Confirmed health and water spending rose from about TZS 1.25 trillion in 2020/21 to about TZS 2.92 trillion in 2026/27 — growth of roughly 134 percent, against roughly 10-12 percent for infrastructure ministries over the same period.
The underlying gaps are still wide. Tanzania's teacher-pupil ratio, doctor-population ratio, cereal yield per hectare and life expectancy all remain well below UMIC averages — the income class Dira 2050 targets by 2050.
FYDP IV's financing model may make this less of a binary choice. With roughly 70 percent of FYDP IV's resource needs expected from private capital and PPPs — concentrated in infrastructure, ports, energy and roads — public fiscal space may be freer than the raw numbers suggest to prioritise human capital, provided the PPP pipeline actually delivers.

📌

Read this alongside TICGL's flagship Dira 2050 analysis

This report builds directly on TICGL/TERI's assessment of the policy gaps standing between Tanzania and Dira 2050's US$1 trillion, US$7,000-per-capita ambition by 2050 — including the financing, productivity and institutional gaps that infrastructure and human capital spending must both help close.

Read: What's Next for Tanzania's Economy? The Policy Gaps Keeping $1 Trillion Out of Reach by 2050 →

02 — The DataTanzania vs Upper-Middle-Income Countries: The Human Capital Gap

Dira 2050 aims to move Tanzania into the upper-middle-income bracket by mid-century, with a US$1 trillion economy and roughly US$7,000 GDP per capita. Comparing Tanzania today against the average UMIC country shows how much ground human capital indicators still need to cover — regardless of how the infrastructure-versus-human-capital budget question is eventually resolved.

Table: Tanzania vs UMIC average, four core human development indicators
Indicator	Tanzania	UMIC Average	Source
Teacher : pupil ratio (primary school)	1 teacher : 50-63 pupils (national average 63:1; some councils such as Kasulu reach 103:1)	1 teacher : 16-24 pupils	World Bank / UNESCO UIS
Government spending per primary pupil	Whole education sector: ~TZS 4.77T (2016/17) to TZS 5.26T (2021/22); no precise per-pupil figure available	Typically 3-5x Tanzania's per-pupil spending	Ministry of Education, Education Policy 2014 (2023 edition)
Doctors per 10,000 people	1.34 (about 1 doctor per 7,460 people)	China 31.1; Brazil 23.6; South Africa 7.9	WHO / World Population Review 2026
Cereal yield (kg per hectare)	1,651 kg/ha (2021)	Brazil 5,003 kg/ha; South Africa 4,562 kg/ha (2024)	World Bank WDI / FAO
Life expectancy at birth	67-68.3 years (2023-25, depending on source)	76.2 years (2023 UMIC average)	World Bank WDI; FYDP IV health sector data
World Bank Human Capital Index Plus (HCI+, out of 325)	133 (Health 37, Education 52, Employment 43)	Sub-Saharan Africa average 126; lower-middle-income average 153; Kenya 171	World Bank Human Capital Project, 2026

Teacher-Pupil Ratio: Tanzania vs Upper-Middle-Income Countries

Pupils per primary-school teacher — lower is better

Doctors per 10,000 People

Tanzania vs selected UMIC comparators

Cereal Yield (kg per hectare)

Agricultural productivity, Tanzania vs UMIC comparators

Life Expectancy at Birth

Years, Tanzania vs UMIC average

Human Capital Index Plus (HCI+) Score

Out of 325 — Tanzania vs regional and income-group averages

⚠ Teacher-pupil and doctor-population ratios are the most recent figures publicly available (2018-2024) from differing sources; not all indicators are updated annually by the World Bank or WHO.

What the HCI+ score actually means

The World Bank's Human Capital Index Plus estimates how productive a child born in Tanzania today can expect to become by the end of their working life, given current health and education outcomes. Tanzania's score of 133 means a Tanzanian child today can expect to reach only 41 percent of the productivity they could achieve with complete education and full health. Closing the gap with high-performing countries at a similar income level would raise future incomes by an estimated 66 percent — a bigger single lever than almost any infrastructure project on Tanzania's books.

03 — The DataSectoral Budget Trends: Agriculture, Health, Education and Water, 2020/21-2026/27

Comparing ministerial budgets for agriculture, health, education and water between 2020/21 and the most recent 2026/27 estimates shows consistent, and in some cases dramatic, nominal growth — though starting from a low base in several sectors.

Table: Ministerial budget, 2020/21 vs 2026/27 (TZS)
Ministry	2020/21	2026/27	Growth
Agriculture (Kilimo)	TZS 229.8 billion	Not yet fully announced at time of writing (trend: 2024/25 = TZS 1.249T; 2025/26 = TZS 1.242T)	More than 5x, 2020/21-2025/26
Health (Afya)	~TZS 650 billion (Budget Committee report, June 2020)	TZS 1.8 trillion	~2.8x
Education (Ministry / Fungu 46 only)	Not precisely available; whole education sector ~TZS 4.77-5.0T (2016/17-2021/22)	TZS 2.398 trillion (Ministry only; excludes TAMISEMI funding for primary/secondary schools)	Figures are not directly comparable — see note
Water (Maji)	Not precisely available (2021/22 was TZS 680.3 billion)	TZS 1.12 trillion	~65-85%, plus +33% just since 2025/26 (TZS 898bn → 1.12T)

⚠ Education and Health figures shown are Ministry (Fungu) budgets only, not whole-sector spending. Most primary and secondary education and primary healthcare services are financed through TAMISEMI (President's Office - Regional Administration and Local Government), so the true "sector" total is larger than what appears here. The whole education sector reached TZS 5.26 trillion in 2021/22 alone.

Human-Capital-Adjacent Ministerial Budgets: 2020/21 vs 2026/27

TZS trillions — Agriculture, Health and Water (Education excluded due to non-comparable base years; see table above)

2020/21

Low base across all four sectors

Agriculture at TZS 229.8bn, health at roughly TZS 650bn, water below TZS 700bn — all a small fraction of infrastructure ministries' combined TZS 7.09 trillion that year.

2022/23-2024/25

Agriculture budget multiplies

Kilimo's budget rises from TZS 294bn (2021/22) to TZS 751.1bn (2022/23) to TZS 970.78bn (2023/24) to TZS 1.249 trillion (2024/25) — a more than fivefold increase in four years, before flattening in 2025/26.

2025/26-2026/27

Health and water accelerate again

Water's budget jumps from TZS 898bn to TZS 1.12 trillion in a single year (+33%); health reaches TZS 1.8 trillion, roughly 2.8 times its 2020/21 level.

2026/27

FYDP IV's opening year

The national budget rises to TZS 62.33 trillion (+10.3% year-on-year), explicitly framed as the first operational budget of FYDP IV and Dira 2050.

04 — The Core ComparisonInfrastructure vs Human Capital: The Full Reckoning

Putting construction, transport and energy spending side by side with health, water and education-ministry spending gives the clearest single picture of Tanzania's budget priorities across the FYDP III-to-FYDP IV transition.

🏗️ Infrastructure (Construction + Transport + Energy)

~TZS 7.09 trillion in 2020/21 (Construction, Works and Communications was a single combined ministry at the time)
~TZS 7.7-7.9 trillion in 2026/27 — Transport TZS 2.872T (approved), Energy TZS 2.525T (approved), Construction estimated TZS 2.3-2.5T
Growth of roughly 10-12 percent over six years — modest relative to human capital's growth rate
Still the single largest category of sectoral development spending in absolute TZS terms

🏥 Human Capital (Health + Water + Education-Ministry)

~TZS 1.25 trillion in 2020/21 for confirmed Health + Water alone
~TZS 2.92 trillion in 2026/27 for confirmed Health + Water; adding the Education ministry's TZS 2.398T brings the total to roughly TZS 5.3 trillion
Health + Water growth of roughly 134 percent since 2020/21 — over ten times infrastructure's growth rate
Still smaller in absolute terms than infrastructure, even after the fastest six years of growth on record

Infrastructure vs Human Capital: Total Ministerial Budgets, 2020/21 vs 2026/27

TZS trillions — infrastructure (Construction + Transport + Energy) vs confirmed human capital (Health + Water)

Table: Infrastructure vs human capital, grouped totals
Group	Ministry	2020/21	2026/27	Growth
Infrastructure	Construction, Works & Communications (combined ministry in 2020/21)	TZS 4.9T	Construction (~2.3-2.5T) + Transport (2.872T) ≈ TZS 5.2-5.4T	Modest / gradual
	Energy	TZS 2.19T	TZS 2.525T	+15%
	Infrastructure Total	All infrastructure ministries	≈ TZS 7.09T	≈ TZS 7.7-7.9T	+10-12%
Human Capital	Health	≈ TZS 650bn	TZS 1.8T	+~177%
	Water	≈ TZS 600-680bn	TZS 1.12T	+~65-85%
	Education (Ministry only)	Not available with confidence	TZS 2.398T	—
Human Capital Total (Health+Water, confirmed)	Confirmed subtotal	≈ TZS 1.25T	≈ TZS 2.92T	+~134%

1. Growth rate favours human capital

Between 2020/21 and 2026/27, human-capital budgets (health and water) grew by more than 2.3 times, versus roughly 10-12 percent for infrastructure. This is a genuine acceleration in the direction of Dira 2050's human-development ambitions.

2. Absolute scale still favours infrastructure

In raw TZS terms, infrastructure still commands the larger share of Tanzania's development budget: roughly TZS 7.8 trillion against roughly TZS 2.9-5.3 trillion for confirmed human capital, depending on whether the Education ministry is included.

3. The trend line, not the snapshot, is the story

The direction of travel shows government accelerating investment in social services, even though infrastructure still leads in overall scale of funding — a rebalancing in progress rather than a completed shift.

⚠ The Ministry of Works, Transport and Communications that existed in 2020/21 has since been split into separate Construction and Transport ministries. Comparisons combine functionally equivalent ministries and are therefore approximate, not exact.

05 — Supporting DataWhere the Whole TZS 62.33 Trillion Budget Goes

Infrastructure and human capital spending sit inside a much larger national budget. Understanding the full FY2026/27 envelope — TZS 62.33 trillion, up 10.3 percent on 2025/26 — shows how much fiscal room genuinely exists for either priority once debt service, subsidies, wages and pensions are accounted for.

Total FY2026/27 Budget

TZS 62.33T

+10.3% vs 2025/26 (TZS 56.49T)

Domestically Financed

74.2%

Of total budget, from domestic revenue

Projected Revenue

TZS 46.79T

Tax revenue TZS 36.99T; other revenue TZS 9.24T

Budget Deficit

TZS 7.71T

Financed via domestic and external borrowing

FY2026/27 Budget Composition

TZS trillions, by expenditure category (excludes debt principal repayment)

Note: "Subsidies" (ruzuku, TZS 25.32T) is the largest single category and includes transfers to public institutions, LGAs, and sector programmes — this is the pool from which much of both infrastructure PPP support and human-capital service delivery (schools, hospitals) is actually funded, beyond the ministries' own direct development votes shown in earlier sections.

Why this matters for the infrastructure-vs-human-capital question

Interest payments alone (TZS 6.86 trillion) are now larger than either the entire health ministry or water ministry budget, and personnel costs (TZS 10.13 trillion) dwarf both combined. This is the fiscal reality within which any reprioritisation between infrastructure and human capital must happen — it is not simply a question of moving money from one ministry's vote to another, but of managing debt service, wage bill growth, and subsidy commitments that already claim the majority of the budget before a single road or classroom is funded.

06 — Policy ContextWhat FYDP IV and Dira 2050 Actually Prioritise

Tanzania's Long-Term Perspective Plan (LTPP) 2050 — Dira 2050 — is implemented through five successive Five-Year Development Plans, the first of which, FYDP IV, runs from 2026/27 to 2030/31 under the theme "Reforms for Inclusive Economic Growth and Employment Creation." TICGL's prior analysis frames FYDP IV's underlying philosophy as the "4Rs": Reform, Reconciliation, Rebuilding and Resilience.

FYDP IV's Five Core Priorities

Building a strong, inclusive and competitive economy through nine transformation sectors
Promoting human capital and social development
Strengthening environmental conservation and climate resilience
Advancing economic transformation drivers
Reinforcing governance, peace, security and stability

Human capital is formally listed as one of five co-equal national priorities — not subordinate to infrastructure or economic transformation, at least on paper.

FYDP IV's Headline Targets by 2030/31

Nominal GDP of US$118.052 billion
Real GDP growth of 10.5 percent
A step toward Dira 2050's US$1 trillion economy and US$7,000 per-capita income by 2050
70:30 private-to-public financing architecture — the private sector expected to provide 70 percent of resources needed for Plan implementation

FYDP IV's Planned Financing Architecture

Share of total resource needs expected from private capital vs public budget

Why the 70:30 split matters for this debate

If PPPs, FDI and blended finance genuinely deliver 70 percent of FYDP IV's resource needs — targeted at construction, transport, energy, ports and industrial infrastructure — then a meaningful share of Tanzania's infrastructure ambition does not have to compete directly with health, education and water for scarce public shillings. Public and Statutory Corporations, holding assets exceeding TZS 92.3 trillion, are being restructured specifically to attract this private capital. The Plan targets PPPs contributing 10 percent of GDP by June 2030, with 6-8 projects reaching commercial close, mobilising TZS 4.0-5.0 trillion in private capital.

The catch: Tanzania's PPP track record to date has been described as modest by independent analysts, and development-budget execution rates run around 52 percent versus 93 percent for recurrent spending — meaning this fiscal-space argument is currently more of a plan than a proven mechanism.

The tax-to-GDP constraint underneath everything

Tanzania's tax-to-GDP ratio is estimated at roughly 12.9-13.1 percent for 2024 by TICGL/TERI's own research, below the Sub-Saharan Africa average commonly cited in the 15-18 percent range, and well below FYDP IV's own 2030 target of 18 percent. Independent analysts have gone further, suggesting a ratio closer to 22 percent may be needed to sustainably finance Vision 2050's full ambitions without over-relying on debt. Until the tax base widens, every additional shilling for either infrastructure or human capital increasingly has to come from borrowing, subsidy reallocation, or genuinely successful PPP mobilisation — not fresh domestic revenue.

07 — Comparative LessonsWhat Did Other Developing Countries Prioritise First?

Tanzania is not the first country to face this choice. Looking at how South Korea, China, Vietnam, Rwanda and Ethiopia sequenced infrastructure and human-capital investment on their own development paths offers some grounding — though, as the evidence below shows, there is no single formula that guarantees success.

🇰🇷 South Korea: Human Capital First, Infrastructure Followed

In the 1950s and early 1960s, Korea used more than US$100 million in foreign aid for education, dedicating roughly US$70 million to building and repairing classrooms and a further US$19 million to Seoul National University and other institutions, even while the country was still recovering from war and had scarce infrastructure. Only from the 1960s-1980s did the state pivot toward capital-intensive, infrastructure-heavy heavy industry. Korea's total domestic investment from 1960-1990 averaged 26.3 percent of GDP, with about a third of that going to infrastructure — but the education base built in the 1950s is widely credited as the precondition that let later industrial investment pay off.

🇨🇳 China: Infrastructure-Led, Investment-Driven Growth

China's growth since 1978 has been defined by sustained, investment-led infrastructure development — averaging around 8 percent of GDP annually in the early 2000s — layered on top of rural land reforms and foreign direct investment that together cut poverty from 60 percent of the population in 1980 to 8 percent by 2009. Chinese policymakers have historically treated rapid infrastructure investment growth as a precondition for sustaining high GDP growth, rather than a reward for it.

🇻🇳 Vietnam: Following the Infrastructure-First Playbook

Vietnam's Doi Moi reforms, launched in 1986 (eight years after China's own reform), consciously mirrored China's development path, including its emphasis on infrastructure as a growth driver. Vietnam still needs an estimated US$25 billion a year in infrastructure investment, and continues to rely heavily on foreign capital and technical partners — including a cautious, security-conscious relationship with Chinese infrastructure financing — to close the gap.

🇷🇼 Rwanda: Trying to Run Both Tracks in Parallel

Rwanda's Vision 2020 and Vision 2050 explicitly targeted human capital development, growth-enhancing infrastructure, and higher-value economic activity simultaneously, with public investment averaging around 10 percent of GDP. The results are mixed: Rwanda built over 40 microhydro plants in 15 years and posted some of the region's best logistics performance, yet a persistent skills gap remains, with around 22 percent of the manufacturing workforce reporting limited technical proficiency and over 90 percent needing soft-skills training — a caution that infrastructure gains alone do not automatically produce a workforce able to use them.

🇪🇹 Ethiopia: Pragmatic, Sector-Specific Infrastructure

Ethiopia's modernisation drive focused on large agricultural plantations, industrial parks, and pragmatic energy solutions tailored to rural realities, evoking classic mid-20th-century infrastructure-led modernisation. Independent reviews credit Ethiopia's energy-access gains as a genuine driver of progress, while noting that, as with Rwanda, execution capacity and complementary human capital investment remain the binding constraints on translating infrastructure into broad-based productivity gains.

🇹🇿 Tanzania: Currently Closer to the Infrastructure-First Model

On the numbers in this report, Tanzania's actual spending pattern — infrastructure still commanding roughly 1.5-2.5 times the confirmed human-capital budget in absolute terms — sits closer to the China/Vietnam/Ethiopia infrastructure-led tradition than to Korea's education-first sequencing or Rwanda's declared dual-track approach, even though FYDP IV's stated priorities read more like Rwanda's parallel-track framing.

The one consistent warning across all five cases

No country in this comparison achieved sustained high growth through infrastructure investment alone, without a workforce capable of using that infrastructure productively. Korea's heavy-industry boom depended on a workforce Korea had already educated. China and Vietnam paired infrastructure-led growth with large, continuous investments in basic education and health that are easy to overlook next to the more visible infrastructure story. Rwanda and Ethiopia's experience shows that even genuinely impressive infrastructure gains can be undercut by skills shortages that leave new capacity under-utilised. For Tanzania, the lesson is less "infrastructure or human capital" and more "infrastructure without human capital is a stranded asset."

08 — TICGL AnalysisSo What Should Tanzania Prioritise?

TICGL's reading of the evidence is that Tanzania does not face a clean either/or choice, but it does face a sequencing and intensity choice — and the data in this report suggests the intensity needs to shift further toward human capital than current budget trends have managed so far, for four reasons.

1. The productivity return on closing human capital gaps is larger and faster

The World Bank's own HCI+ modelling suggests closing Tanzania's human capital gap with high-performing income-peers would raise future incomes by roughly 66 percent — a bigger single national productivity lever than any individual infrastructure corridor currently on Tanzania's books, including the SGR or the Julius Nyerere hydropower station.

2. FYDP IV's own financing model frees room for exactly this shift

If the 70:30 private-to-public financing architecture works as designed, most new infrastructure capital should come from PPPs, FDI and restructured public corporations rather than the recurrent budget — precisely the mechanism that should let public shillings concentrate more on health, education and water, which are far harder to finance through private capital because their returns are diffuse, long-term, and non-excludable.

3. Existing infrastructure commitments should be completed, not abandoned

SGR, port modernisation, and the National Water Grid represent large sunk investments with genuine growth payoffs once complete; halting them to redirect funds would likely destroy more value than it creates. The choice is not to strip infrastructure funding, but to ensure its growth rate does not continue to outpace human capital's as FYDP IV progresses.

4. Regional and global evidence favours running both tracks, but weighting toward people

Korea's experience — foundational education investment before the infrastructure-heavy industrial push — is the closest historical analogue to a country starting, as Tanzania is, from a low human-capital base with an ambitious multi-decade income target. Rwanda's parallel-track approach, while imperfect, shows dual investment is achievable at Tanzania's income level; its remaining skills gap is itself an argument for weighting the human-capital side of that balance more heavily than Rwanda has.

TICGL's bottom line

Tanzania should treat FYDP IV's 70:30 private-public financing target for infrastructure as a binding commitment to actively pursue, not an assumption to bank passively — because its success is what creates the fiscal space for the second half of this argument. At the same time, given that human capital's growth in Tanzania's budget over 2020/21-2026/27, while rapid in percentage terms, has still not closed the absolute gap with infrastructure, TICGL's assessment is that the marginal shilling of new public spending through 2030/31 should tilt toward human capital — particularly toward closing the teacher-pupil and doctor-population ratios that most directly limit how much value Tanzania's citizens, and its completed infrastructure, can ultimately generate.

09 — TICGL RecommendationsGetting the Balance Right Under FYDP IV

Publish a consolidated, comparable annual infrastructure-vs-human-capital scorecard that nets out ministry restructuring (such as the Works/Transport split) so the trend is auditable year over year, not just within isolated ministry budget speeches.
Make the 70:30 PPP financing target a tracked, published commitment, with quarterly disclosure of PPP projects reaching commercial close against the 6-8 project, TZS 4.0-5.0 trillion target — the credibility of this target is what determines whether infrastructure can be funded without crowding out human capital.
Prioritise teacher and doctor recruitment and retention as a headline FYDP IV human-capital target with the same visibility currently given to SGR kilometres completed or megawatts connected to the grid.
Fund TAMISEMI-administered primary education and primary healthcare transparently alongside ministry-level figures, so public debate is not distorted by comparing partial (Fungu-only) human-capital budgets against full infrastructure ministry totals.
Treat tax-to-GDP expansion as the precondition for both priorities — closing the gap toward FYDP IV's own 18 percent target (and the 22 percent some analysts argue is truly needed) reduces the degree to which infrastructure and human capital have to compete for the same limited pool of domestic revenue.

10 — Quick AnswersFrequently Asked Questions

Does Tanzania spend more on infrastructure or on human capital?

In absolute terms, infrastructure still leads — roughly TZS 7.8-7.9 trillion in 2026/27 across construction, transport and energy, versus roughly TZS 2.9 trillion in confirmed health and water spending. But human-capital budgets have grown over ten times faster in percentage terms since 2020/21.

What is Tanzania's teacher-to-pupil ratio compared to upper-middle-income countries?

About 63 pupils per teacher nationally, reaching over 100:1 in some councils, versus 16-24:1 in upper-middle-income countries.

What is Tanzania's doctor-to-population ratio?

About 1.34 doctors per 10,000 people — roughly 1 doctor per 7,460 residents — compared with 31.1 per 10,000 in China, 23.6 in Brazil, and 7.9 in South Africa.

What does FYDP IV say about infrastructure and human capital?

Human capital and social development is one of FYDP IV's five core priorities, alongside a competitive economy across nine transformation sectors. The Plan expects the private sector to fund roughly 70 percent of total resource needs, largely for infrastructure, which could free public resources for social spending if the financing model succeeds.

Did other developing countries prioritise infrastructure or human capital first?

There is no single formula. South Korea invested heavily in education before its infrastructure-heavy industrial push. China and Vietnam pursued infrastructure-led growth. Rwanda has tried to pursue both in parallel, though a persistent skills gap remains despite strong infrastructure gains.

11 — MethodologySources & Notes

World Bank Open Data (World Development Indicators) and UNESCO Institute for Statistics — teacher-pupil ratios, cereal yield, life expectancy.
WHO Global Health Observatory and World Population Review 2026 — doctor-population ratios.
World Bank Human Capital Project — Tanzania's Human Capital Index Plus (HCI+) brief, 2026.
Ministry of Finance Tanzania — FY2026/27 Budget Speech and Mapendekezo ya Ukomo wa Bajeti 2026/27-2028/29 (mof.go.tz).
Sectoral budget speeches and parliamentary approvals, 2025/26-2026/27: Ministry of Agriculture, Ministry of Health, Ministry of Water, Ministry of Energy, Ministry of Transport, Ministry of Construction.
TICGL/TERI prior research: "Tanzania's 2026/27 Budget: The First Blueprint of FYDP IV," "Tanzania Budget 2026/27: Can It Mobilize USD 121 Billion GDP by 2030/31?," "Tanzania's Health Economy Under FYDP IV," and "The Price of Formalisation" tax-policy report.
ODI (Overseas Development Institute) — "Moving from vision to delivery: implementing Tanzania's Vision 2050."
TanzaniaInvest — FYDP IV PPP framework, financing targets and Vision 2050 overview.
International comparisons drawn from published academic and multilateral sources on South Korea, China, Vietnam, Rwanda and Ethiopia's development strategies, including World Bank Human Capital Project country studies and IMF/AfDB country papers.
This page is an independent analytical summary prepared by TICGL/TERI and does not constitute financial, investment, tax, or legal advice.

Muhtasari

Muhtasari kwa Kiswahili

Miundombinu Dhidi ya Maisha ya Watu: Bajeti ya Tanzania Inaelekea Wapi? Kati ya 2020/21 na 2026/27, bajeti za afya na maji zimeongezeka kwa zaidi ya asilimia 134, ikiwa ni zaidi ya mara kumi ya kasi ya ongezeko la bajeti za miundombinu (ujenzi, uchukuzi na nishati) ambazo zimeongezeka kwa asilimia 10-12 tu katika kipindi hicho hicho. Hata hivyo, kwa thamani halisi, miundombinu bado inachukua fedha nyingi zaidi — takribani shilingi trilioni 7.8 mwaka 2026/27 — ikilinganishwa na takribani trilioni 2.9 za afya na maji zilizothibitika.

Tanzania bado inakabiliwa na pengo kubwa la maendeleo ya watu: uwiano wa mwalimu kwa mwanafunzi wa 1:63 (ukilinganisha na 1:16-24 katika nchi za kipato cha kati cha juu), daktari 1.34 kwa kila watu 10,000, na alama ya Human Capital Index Plus ya 133 kati ya 325 — ikimaanisha mtoto anayezaliwa Tanzania leo anatarajiwa kufikia asilimia 41 tu ya uwezo wake kamili wa uzalishaji. Mpango wa Nne wa Maendeleo wa Taifa (FYDP IV, 2026/27-2030/31) umeweka maendeleo ya watu (human capital) kama mojawapo ya vipaumbele vitano vikuu, na unategemea asilimia 70 ya fedha za utekelezaji kutoka sekta binafsi (PPP), hasa kwa miundombinu — jambo ambalo, likifanikiwa, laweza kuachia fedha zaidi za umma kwa ajili ya elimu, afya na maji.

Kwa kulinganisha na nchi nyingine: Korea Kusini iliwekeza kwanza kwenye elimu kabla ya kuingia kwenye miundombinu mikubwa ya viwanda; China na Vietnam zilifuata mkondo wa miundombinu-kwanza; Rwanda inajaribu kuchanganya vyote viwili kwa wakati mmoja, ingawa bado ina pengo kubwa la ujuzi wa wafanyakazi licha ya mafanikio makubwa ya miundombinu. Uchambuzi wa TICGL unaonyesha kuwa Tanzania haihitaji kuchagua kimoja tu — bali inahitaji kuhakikisha mfumo wa ubia wa umma na binafsi (70:30) unafanya kazi kikamilifu ili kuachia nafasi zaidi ya kibajeti kwa maendeleo ya watu, hasa katika kuongeza idadi ya walimu na madaktari.

Bajeti ya afya na maji: ongezeko la asilimia 134 (2020/21-2026/27)
Bajeti ya miundombinu: ongezeko la asilimia 10-12 tu, lakini bado ni kubwa zaidi kwa thamani halisi (~trilioni 7.8)
Uwiano wa mwalimu-mwanafunzi: 1:63 Tanzania dhidi ya 1:16-24 UMIC
Alama ya Human Capital Index Plus: 133/325 — chini ya wastani wa nchi za kipato cha kati cha chini (153)

Vyanzo: Wizara ya Fedha, Benki ya Dunia, WHO, UNESCO, hotuba za bajeti za wizara husika, na utafiti wa awali wa TICGL/TERI. Uchambuzi umeandaliwa na Idara ya Utafiti ya TICGL / Tanzania Economic Research Institute (TERI).

01 — OverviewExecutive Summary

Two numbers about Tanzania's tax base are both accurate, and both keep making headlines for opposite reasons. The first: TRA's cumulative taxpayer register — everyone ever issued a Taxpayer Identification Number (TIN) — has grown from around 70,000 at TRA's founding in 1996 to over 8.1 million by mid-2026, a milestone TRA itself celebrated at its 30th anniversary. The second: the number of "active" registered taxpayers — those the Ministry of Finance counts as actually filing and paying in a given period — fell from 3.36 million in 2021/22 to 2.18 million in 2024/25, a decline of roughly a third, even as formalisation campaigns continued over the same period.

This report, building on TICGL/TERI's earlier tax-policy research, digs into what sits underneath both numbers: how a shrinking "active" base and a growing "registered" base can be simultaneously true, why TRA's revenue collections have kept setting records regardless, and what the gap means for Tanzania's Dira 2050 ambitions to widen its domestic revenue base.

The register keeps growing because it almost never shrinks. A TIN, once issued, is rarely cancelled — so the cumulative count rises even when many holders stop filing.
"Active" is a stricter, shrinking flow measure. Reported active-taxpayer snapshots show a consistent downward trend across three independent citations between 2021/22 and 2024/25.
Revenue has grown anyway — TZS 32.26 trillion in 2024/25, TZS 37.95 trillion in 2025/26 — driven disproportionately by large taxpayers, customs, and digital administration, not by growth in the number of small active filers.
Compliance infrastructure lags registration: 88 percent of business-TIN holders were not registered for Electronic Fiscal Devices as of July 2024, per the Controller and Auditor General.

📌

Read this alongside TICGL's full tax-policy study

This piece is a deep dive into one finding from TICGL/TERI's August 2026 report on tax policy under Dira 2050 — which asks whether MSME formalisation can realistically fund Tanzania's US$1 trillion ambition, or whether formalisation and domestic-revenue mobilisation need to be pursued as two separate jobs.

Read: The Price of Formalisation — Tax Policy, MSME Growth & Domestic Revenue under Dira 2050 →

Companion analysis

For the wider structural picture, see What's Next for Tanzania's Economy? The Policy Gaps Keeping $1 Trillion Out of Reach by 2050, which sets the domestic-revenue question in the context of Tanzania's full Dira 2050 financing gap.

02 — The Core TensionRegistered vs Active: Tanzania's Two Taxpayer Numbers

Ask "how many taxpayers does Tanzania have?" and the honest answer is: it depends which of two very different numbers you mean.

📇 Total Registered (TIN Holders)

8.1 million+ as of mid-2026 — up from 70,000 at TRA's 1996 founding
A cumulative stock: once a TIN is issued, it is rarely cancelled, even if the holder stops trading or filing
Grew from 4.46 million (2021/22) to 6.27 million (2023/24) to roughly 7.7 million (late 2025), per NBS Tax Statistics data and subsequent reporting
Reflects registration drives, digital onboarding, and formalisation campaigns pulling more people and businesses into the system

✅ "Active" Taxpayers (Filing & Paying)

2.18 million in 2024/25 — down from 3.36 million in 2021/22
A flow measure: counts who is actually filing returns and making payments in a given period
An intermediate snapshot of 2.82 million was cited by Tanzania's Vice President as of 2024, consistent with a continuing downward trend
Ministry of Finance and senior officials have publicly linked the decline to overburdening of the existing taxpayer pool

Why both numbers can be true

Think of the register as a bathtub that almost never drains: TINs flow in continuously through new registrations, but very few flow out through cancellation, even for businesses that have closed or gone dormant. "Active" status measures something different — who is actually turning up to file and pay in a specific tax year. It's entirely possible, and is exactly what Tanzania's data shows, for the bathtub to keep filling while the share of taxpayers actively transacting with TRA in any one period shrinks.

03 — The DataThe Decline in Active Taxpayers: Three Data Points, One Direction

3.36M active, 2021/22 2.82M active, 2024 2.18M active, 2024/25

Three independent public citations, spaced roughly a year apart, all point the same way. In April 2025, Tanzania's Vice President expressed concern that registered active taxpayers had dropped from 3.36 million in 2021–2022 to 2.82 million in 2024, urging renewed efforts to expand the base. TICGL/TERI's own August 2026 tax-policy research, citing Ministry of Finance data, put the 2024/25 active count at 2.18 million — continuing the same downward trajectory into the most recent fiscal year on record.

Active Registered Taxpayers: The Downward Trend, 2021/22–2024/25

Millions of active (filing/paying) taxpayers, as reported at each citation point

Note: these three figures come from separate public citations (Vice President's April 2025 remarks; TICGL/TERI's August 2026 report citing the Ministry of Finance) rather than a single continuous published series, so treat the connecting line as an illustrative trend rather than a precise quarterly series. All three, however, are consistent in direction and rough magnitude.

Table: Reported active taxpayer figures and their sources
Period	Active Taxpayers	Source / Citation
2021/22	3.36 million	Cited by the Vice President, April 2025 (as the base year for comparison)
2024 (calendar year)	2.82 million	Vice President's remarks, reported April 2025
2024/25 (fiscal year)	2.18 million	Ministry of Finance data, cited in TICGL/TERI's August 2026 tax-policy report
Change, 2021/22 → 2024/25	-35% approx.	Consistent downward direction across both citations

Whichever exact endpoint one uses — 2.82 million or 2.18 million — the direction and rough scale of the decline are corroborated by two independent sources roughly a year apart, which strengthens confidence that this is a genuine trend rather than a one-off data anomaly or reporting quirk.

04 — The DataThe Register Keeps Growing: 70,000 to 8.1 Million

Set against the active-taxpayer decline, the cumulative TIN register tells an almost opposite story. NBS's Tax Statistics Report series shows the total registered taxpayer count rising every year on record, and TRA's own 30th-anniversary figures put the milestone at over 8.1 million by mid-2026.

Total Registered Taxpayers, 2017/18–2023/24

Thousands of TIN holders, per NBS Tax Statistics Report data, with year-on-year growth

The Long Run: TRA's Register Since 1996

Selected milestones, thousands of registered taxpayers (log scale)

Table: Total registered taxpayers by fiscal year
Fiscal Year	Registered Taxpayers	YoY Change
2017/18	2,739,000	—
2018/19	2,917,000	+6.5%
2019/20	3,181,000	+9.1%
2020/21	4,107,000	+29.1%
2021/22	4,455,000	+8.5%
2022/23	5,494,000	+23.3%
2023/24	6,272,000	+14.2%
~Dec 2025	~7.7 million	continuing rise
Mid-2026	8.1 million+	TRA 30th-anniversary milestone

~1996

TRA established

Roughly 70,000 taxpayers on record, annual collections around TZS 207 billion.

2017/18–2023/24

NBS-tracked expansion

Register more than doubles, from 2.74 million to 6.27 million, driven by successive registration and formalisation drives.

2021/22–2024/25

The active-count divergence begins

Even as the total register keeps climbing, active filing-and-paying taxpayers fall from 3.36 million to 2.18 million.

Mid-2026

Register crosses 8.1 million

TRA marks its 30th anniversary; operational offices have grown from 95 to 323, and staff from 924 to 8,790, over the same broad period of expansion.

05 — TICGL AnalysisReconciling the Numbers: Stock, Flow, and What Gets Missed

The headline tension — "taxpayers are disappearing" versus "the register just hit a record 8.1 million" — dissolves once the two figures are read as what they actually measure, but that doesn't make the underlying compliance problem any less real.

1. TINs are sticky by design

A TIN functions as a permanent identity number, similar to a national ID, rather than a subscription that lapses. Businesses that close, individuals who die or emigrate, and duplicate or dormant registrations from earlier drives all remain in the cumulative count unless specifically cleaned up — something TRA's own systems, per the CAG's 2025 audit, do not yet do systematically.

2. "Active" is where the real story sits

The active-taxpayer figures — however imperfectly tracked across different citations — are the ones that actually matter for whether Dira 2050's formalisation and domestic-revenue goals are being met. A shrinking active base, even alongside a growing register, means TRA is working harder to extract the same or more revenue from a narrower, potentially more strained pool of genuinely compliant filers.

3. Both trends can share one cause

Complex procedures and compliance costs can simultaneously push existing filers toward inactivity or informality (shrinking the active count) while registration drives continue adding new TINs faster than genuine compliance grows behind them (expanding the register) — precisely the dynamic TICGL/TERI's Price of Formalisation report flags as a risk of formalisation drives "running in place."

Why this matters for policy

If policymakers cite only the growing 8.1 million register, the taxpayer-base story looks like unambiguous success. If they cite only the falling active count, it looks like unambiguous failure. Neither framing alone is accurate — and a formalisation strategy built on the register number risks overstating how much of Dira 2050's domestic-revenue gap it is actually closing, exactly the caution TICGL/TERI's tax-policy research raises about relying on MSME-focused instruments for material new revenue.

06 — The DataRevenue Keeps Rising — So Who Is Actually Paying?

Despite the active-taxpayer decline, TRA has posted record collections and beaten its target for 24 consecutive months through mid-2026. That is not a contradiction of the taxpayer-decline story — it is a clue to where Tanzania's tax revenue actually comes from.

TRA Annual Tax Collections vs Target

TZS trillions, selected fiscal years

Where December 2025 Revenue Came From

Share of TZS 4.13 trillion collected in December 2025, by source

In December 2025 alone, TRA collected TZS 4.13 trillion, of which large taxpayers contributed roughly TZS 1.9 trillion and customs roughly TZS 1.2 trillion — together well over 70 percent of that month's total — while small and medium traders contributed around TZS 838 billion. This composition is consistent with the study's broader finding: material revenue growth is concentrated among large taxpayers, customs, and administrative efficiency gains, not among the millions of small, actively-registered filers whose numbers have been shrinking.

FY2021/22 Collections

TZS 22.2T

Baseline year for active-taxpayer comparison

FY2023/24 Collections

TZS 26.73T

~85% of that year's domestic revenue

FY2024/25 Collections

TZS 32.26T

103% of target, +16.7% YoY

FY2025/26 Collections

TZS 37.95T

105% of target, 24th consecutive month above target

07 — Supporting DataTax-to-GDP in Context: Progress, But Still Below Regional Peers

Tanzania's tax-to-GDP ratio has been reported at different points between roughly 11.5 percent and 14.9 percent depending on the source, methodology, and fiscal year — reflecting genuine improvement over time as well as differences in how domestic revenue is measured. TICGL/TERI's own Price of Formalisation report puts the 2024 figure at approximately 12.9–13.1 percent. Across nearly every measure, however, Tanzania remains below the Sub-Saharan Africa average, most commonly cited in the 15–18 percent range.

Tanzania's Tax-to-GDP Ratio: The Range Across Sources

Percent of GDP, as reported by different sources and time periods (2023–2025)

Figures vary because different institutions use different fiscal-year definitions, revenue scopes (tax-only vs total domestic revenue), and GDP rebasing assumptions. TICGL reports the range transparently rather than resolving it to a single figure, consistent with the approach in the companion Price of Formalisation report.

08 — Supporting DataThe Informality Gap Behind the Numbers

Underneath both the register and the active count sits Tanzania's large informal sector, estimated at 45–55 percent of GDP and 70–76 percent of the workforce depending on the source and year. The Tanzania Private Sector Foundation has noted that while roughly 70 percent of businesses in Tanzania are privately owned, only about 30 percent are formally registered with TRA — a gap that helps explain why a growing TIN register does not automatically translate into a growing active, revenue-contributing base.

EFD Compliance Among Business TIN Holders

As of July 2024, per the Controller and Auditor General's April 2025 audit

Formal vs Informal Business Registration

Share of privately owned businesses formally registered with TRA

The CAG's audit found that of 2,056,723 traders holding a business TIN as of July 2024, 1,813,385 — about 88 percent — were not registered to use Electronic Fiscal Devices, despite EFDs being central to VAT compliance and receipt-based revenue verification. TRA management noted that EFD use is not mandatory for all traders due to turnover- and nature-of-business exemptions, but the audit also found TRA's own information systems could not clearly identify which non-EFD traders were actually exempt versus simply non-compliant — a gap in the very administrative data needed to convert "registered" into reliably "active."

09 — TICGL ViewWhat This Means for Tanzania's Domestic Revenue Strategy

For TRA and the Ministry of Finance

A public "active" taxpayer metric — tracked consistently over time, and reconciled with the total register — would let policymakers monitor the compliance trend directly, rather than relying on periodic public citations that vary in scope and vintage as this report's own sourcing had to work around.

For the formalisation agenda

New registration drives should be judged on whether they convert into sustained active filing, not just TIN issuance. Diagnosing why an existing pool of taxpayers is lapsing into inactivity may matter more for Dira 2050's revenue target than continuing to add new registrations to an already fast-growing stock.

For investors and the private sector

The concentration of revenue growth among large taxpayers and customs, documented above, suggests Tanzania's near-term domestic-revenue gains will keep depending disproportionately on a relatively small number of large, well-administered taxpayers rather than broad-based small-business compliance — a dynamic worth factoring into market-entry and partnership planning.

10 — TICGL RecommendationsClosing the Registered–Active Gap

Publish a consistent, dated "active taxpayer" series alongside the total TIN register, so the two figures are never read as competing claims about the same thing.
Audit and clean the TIN database to separate genuinely dormant, closed, or duplicate registrations from taxpayers who are simply non-compliant — the distinction the CAG's 2025 audit found TRA's own systems could not make.
Diagnose the causes of inactivity among the roughly 1.2–1.4 million taxpayers who appear to have moved from active to inactive status since 2021/22, before launching further large-scale registration drives.
Close the EFD compliance gap among the 88 percent of business-TIN holders not yet registered for EFDs, prioritising traders TRA's own data cannot currently classify as exempt or non-compliant.
Evaluate formalisation campaigns on active-filing conversion, not registration counts alone, so success is measured by sustained compliance rather than by how many new TINs are issued.

11 — Quick AnswersFrequently Asked Questions

Is the number of taxpayers in Tanzania rising or falling?

Both, depending on which figure you look at. The total register has grown from about 70,000 to over 8.1 million, but "active" taxpayers — those actually filing and paying — fell from 3.36 million (2021/22) to 2.18 million (2024/25).

How many people are registered with TRA in Tanzania?

Over 8.1 million taxpayers were on TRA's register as of mid-2026, up from about 6.27 million in 2023/24 and 4.46 million in 2021/22.

Why is the active-taxpayer count falling while total registrations rise?

Registration is a cumulative stock that rarely shrinks; "active" status is a flow measuring who is actually filing and paying in a given period. A taxpayer can hold a valid TIN for years while being inactive.

What is Tanzania's EFD compliance rate?

As of July 2024, about 88 percent of business TIN holders (1,813,385 of 2,056,723) were not registered for Electronic Fiscal Devices, per a Controller and Auditor General audit tabled in April 2025.

Is TRA still collecting more revenue despite fewer active taxpayers?

Yes — TZS 32.26 trillion in 2024/25 and TZS 37.95 trillion in 2025/26, driven disproportionately by large taxpayers, customs, and administrative efficiency gains rather than growth in the active small-taxpayer base.

12 — MethodologySources & Notes

Ministry of Finance data on active registered taxpayers (3.3–3.36 million, 2021/22; 2.18 million, 2024/25), as cited in TICGL/TERI's "The Price of Formalisation" report, August 2026.
Vice President's remarks on active taxpayers declining from 3.36 million (2021/22) to 2.82 million (2024), reported by TanzaniaInvest, April 2025.
National Bureau of Statistics (NBS), Tax Statistics Report, 2023/24 — registered taxpayer counts by fiscal year, 2017/18–2023/24.
Tanzania Revenue Authority (TRA) 30th-anniversary corporate communications, July 2026 — total register (8.1 million+), office and staffing expansion.
TRA corporate announcements on 2024/25 (TZS 32.26 trillion, 103% of target) and 2025/26 (TZS 37.95 trillion, 105% of target) revenue performance.
Controller and Auditor General (CAG) performance audit on Electronic Fiscal Devices, tabled in Parliament 16 April 2025 (EFD non-registration among business TIN holders, as of July 2024).
Tanzania Private Sector Foundation (TPSF) remarks on formal vs informal business registration shares, reported April 2025.
Tax-to-GDP ratio figures compiled from multiple sources (PwC Tanzania, World Bank/Trading Economics, TICGL prior research, and TanzaniaInvest), reflecting the range across methodologies and fiscal years discussed in Section 7.
This page is an independent analytical summary prepared by TICGL/TERI and does not constitute financial, investment, tax, or legal advice.

Muhtasari

Muhtasari kwa Kiswahili

Kitendawili cha Walipa Kodi Tanzania: Milioni 8.1 Wamesajiliwa, Lakini Ni Wangapi Wanaolipa Kweli? Orodha ya walipa kodi waliosajiliwa (wenye TIN) imeongezeka kutoka takribani 70,000 mwaka TRA ilipoanzishwa hadi zaidi ya milioni 8.1 kufikia katikati ya mwaka 2026. Wakati huo huo, idadi ya walipa kodi "active" — wanaolipa na kuwasilisha taarifa zao kwa ukawaida — imepungua kutoka milioni 3.36 (2021/22) hadi milioni 2.18 (2024/25), kulingana na takwimu za Wizara ya Fedha.

Takwimu hizi mbili zinaweza kuwa kweli kwa wakati mmoja kwa sababu zinapima vitu tofauti. Usajili (TIN) ni orodha inayoongezeka tu — mara chache TIN hufutwa hata kama biashara imefungwa au mtu hajalipa kodi kwa miaka. "Active" ni kipimo cha wale wanaofanya malipo na kuwasilisha taarifa kwa wakati fulani — na hapa ndipo tatizo halisi la kupungua kwa msingi wa kodi linapoonekana. Licha ya hali hii, TRA imeendelea kuvunja rekodi za makusanyo — Sh trilioni 32.26 (2024/25) na Sh trilioni 37.95 (2025/26) — kwa sababu ukuaji mkubwa wa mapato unatokana zaidi na walipa kodi wakubwa na forodha, si ongezeko la walipa kodi wadogo wanaofanya kazi kikamilifu.

Walipa kodi waliosajiliwa (TIN): zaidi ya milioni 8.1 (2026), kutoka 70,000 (1996)
Walipa kodi "active": milioni 2.18 (2024/25), kutoka milioni 3.36 (2021/22) — punguzo la takribani asilimia 35
Asilimia 88 ya wafanyabiashara wenye TIN hawajasajiliwa kutumia EFD (Julai 2024, Ripoti ya CAG)
Ni asilimia 30 tu ya biashara binafsi zilizosajiliwa rasmi TRA, licha ya asilimia 70 kuwa za watu binafsi

Vyanzo: Wizara ya Fedha, Ripoti ya Takwimu za Kodi ya NBS, TRA, na Mdhibiti na Mkaguzi Mkuu wa Hesabu za Serikali (CAG). Uchambuzi umeandaliwa na Idara ya Utafiti ya TICGL / Tanzania Economic Research Institute (TERI).

01 — OverviewExecutive Summary

In the quarter ending June 2026, Tanzania's mobile money accounts grew 7.5% to 87.05 million — more active wallets than Tanzania has adults — and processed over 2.1 billion transactions, up 5.38% on the prior quarter. That scale, reached in barely a decade since mobile money's launch, now rivals or exceeds the customer reach of the entire formal banking sector by transaction count and active-user footprint, even though banks still hold more total assets and issue the bulk of formal credit.

This report asks a direct question: as mobile money keeps growing faster than bank account penetration, is it complementing Tanzania's banking sector — feeding it new customers and float — or substituting for it, pulling everyday cash flow away from deposit accounts banks rely on to fund lending? The answer, based on TCRA's own data, is: both, and the balance between the two is now one of the more consequential open questions in Tanzania's financial-sector policy.

Mobile money's transaction growth is real but decelerating — from 21.6% quarter-on-quarter growth in late 2025 to 5.38% now, signalling a shift from an acquisition phase to a maturity phase.
Three providers control 89% of accounts — M-Pesa, Mixx by Yas and Airtel Money — concentrating both commercial power and systemic risk in a handful of telecom-linked platforms.
Fraud attempts fell 25.3% quarter-on-quarter even as volumes rose, a sign the payment rails underpinning this growth are becoming more trustworthy, not less.
The rest of the telecom sector — cheap data, expanding 4G, near-universal mobile coverage — is the infrastructure that made this possible, and continues to expand it.

📌

Before you go further — the bigger picture

Financial inclusion, domestic revenue mobilisation and the depth of Tanzania's formal financial system — all touched on below — sit at the centre of a bigger question TICGL has been tracking: the policy gaps standing between Tanzania's current growth path and its Dira 2050, US$1 trillion ambition.

Read: What's Next for Tanzania's Economy? The Policy Gaps Keeping $1 Trillion Out of Reach by 2050 →

Companion analysis

This piece complements TICGL's Is Tanzania's Economy Growing?, which examines the macro numbers behind Tanzania's growth story. Read the two together for the full picture of how digital finance connects to headline GDP growth.

02 — The DataMobile Money in Numbers: Accounts, Transactions, Providers

87.05M active accounts 2.10B transactions this quarter 89% held by 3 providers 22.9% 4-yr account CAGR

Tanzania's mobile money ecosystem processed 2,098,706,145 transactions in the quarter ending June 2026, through 87.05 million active accounts — up from 80.98 million just three months earlier. For a population of roughly 68–69 million, this means the average adult effectively holds more than one active mobile money wallet.

Mobile Money Accounts by Provider

Share of 87.05 million active accounts, June 2026

Mobile Money Transactions by Provider

Share of June 2026 transactions

Table: Mobile money accounts by provider, April–June 2026
Provider	April	May	June	Share (June)
M-Pesa (Vodacom)	32,840,183	34,394,537	35,313,186	40.6%
Mixx by Yas	25,928,787	26,882,220	27,853,189	32.0%
Airtel Money	14,164,833	14,331,645	14,307,193	16.4%
HaloPesa	7,932,463	8,473,702	8,796,709	10.1%
T-Pesa (TTCL)	596,453	631,098	686,101	0.8%
Azam Pesa	81,829	106,957	89,711	0.1%
Total	81,544,548	84,820,159	87,046,089	100%

Mobile Money Accounts — Quarterly Trend

Active accounts, September 2025 – June 2026 (millions)

Mobile Money Transaction Growth Rate

Quarter-on-quarter transaction growth, June 2025 – June 2026 (%)

Mobile Money: Five-Year Account Growth

Active accounts by year, 2021–2025 (millions)

Mobile Money: Five-Year Transaction Volume

Total transactions by year, 2021–2025 (billions)

The five-year picture explains why this matters for banking. Active mobile money accounts grew from 35.29 million in 2021 to 76.47 million in 2025 — a compound annual growth rate of roughly 22.9% — while annual transaction volumes grew from 3.75 billion to 6.31 billion, a CAGR of about 13.8%. But look closely at the growth-rate chart: quarter-on-quarter transaction growth has decelerated sharply, from 21.60% (Sep 2025) to 9.40% (Dec 2025), 7.40% (Mar 2026) and now 5.38% (Jun 2026) — the classic signature of a market shifting from acquiring new users to deepening usage among existing ones. That shift is exactly where the mobile-money-vs-banking question becomes sharpest: what do 87 million wallet-holders do next — keep transacting only in mobile money, or graduate into savings, credit and insurance products that connect them to the formal financial system?

03 — The Core QuestionMobile Money vs Banks: Who's Really Winning Tanzania's Wallet?

Tanzania's central bank and commercial banking system do not publish transaction-level statistics inside TCRA's communications report, so a precise, apples-to-apples comparison isn't possible from this dataset alone. What TCRA's numbers do make clear is the order of magnitude gap in reach and transaction frequency between the two systems — and that gap is the real story.

📱 Mobile Money

87.05 million active accounts (used in the last 90 days)
2.1 billion+ transactions in one quarter (roughly 23 million transactions per day)
Accessible via any basic phone — no minimum balance, no branch visit, no ID-heavy onboarding
Near-universal reach: 167% telephone penetration, mobile money agents in almost every ward
Growth rate: transactions still expanding, but decelerating (5.38% QoQ, down from 21.6%)

🏦 Formal Banking

Bank account penetration remains a fraction of mobile money's reach, concentrated in urban centres
Physical branch and agent-banking footprint far smaller than mobile money's agent network
Requires documentation, and often a minimum balance, to open and maintain an account
Holds the bulk of formal savings, term deposits and long-term credit — mobile money largely does not replace this function
Increasingly linked to mobile money via bank-to-wallet transfers, but interoperability is still maturing

Reading the comparison correctly

Mobile money and banks are not fighting over exactly the same product. Mobile money dominates payments and transfers — the high-frequency, low-value transactions that make up most people's day-to-day financial life. Banks still dominate savings mobilisation, term deposits and formal credit — the lower-frequency, higher-value functions that fund investment and business lending. The risk is not that mobile money "replaces" banking outright, but that it captures and holds liquidity that would otherwise flow into bank deposits, without that liquidity being efficiently recycled back into the formal credit system.

Illustrative: Transaction Frequency, Mobile Money vs a Typical Bank Account

Indicative comparison based on TCRA transaction data and typical retail-banking transaction patterns — illustrative, not an official Bank of Tanzania statistic

This chart is illustrative: TCRA does not publish comparable bank-transaction-frequency data in this report, so the "typical bank account" bar reflects general retail-banking usage patterns rather than an official Bank of Tanzania figure. It is included to visualise the scale gap in transaction frequency, not transaction value — banks still process far higher-value transactions on average.

Where mobile money may be squeezing banks

Deposit disintermediation: wages, remittances and trading proceeds increasingly settle in e-wallets rather than bank current/savings accounts, shrinking the low-cost deposit base banks use to fund lending.
Float sitting outside formal credit markets: unless mobile money trust-account float is efficiently swept into interest-bearing, lendable bank deposits, large sums of liquidity can sit idle relative to their productive potential.
Concentration risk: 89% of accounts sit with three private telecom-linked providers — an operational failure at any one of them would have near-systemic effects on household liquidity.
Weaker monetary-policy transmission: the more money that moves through e-wallets rather than the banking system, the harder it becomes for interest-rate policy to reach households and small businesses quickly.

Where mobile money may be building banks

A ready-made customer funnel: 87 million verified, transacting mobile money users are a natural pipeline for banks and fintechs to convert into savings, micro-credit and insurance customers.
A built-in credit-scoring dataset: transaction histories from mobile money are already used by several Tanzanian lenders to underwrite micro-loans for people with no formal credit history.
Falling fraud, rising trust: a 25.3% drop in fraud attempts this quarter, even as volumes rose, is precisely the kind of trust-building that makes people comfortable moving larger balances and formal products onto digital rails.
Bank-linked wallets already exist: several banks now offer direct mobile-money-to-bank transfers and savings products, meaning growth in mobile money usage can translate into growth in linked bank products if interoperability keeps improving.

04 — TICGL ViewImplications for Tanzania's Financial Sector

On balance, TICGL reads this quarter's data as a net positive for financial inclusion, but one that raises the urgency of specific policy and industry actions to make sure mobile money's growth strengthens, rather than substitutes for, formal financial deepening.

For regulators (BOT & TCRA)

Treat mobile money interoperability, trust-account transparency and outage resilience as macro-financial policy, not just telecom policy. With 89% of 87 million accounts concentrated in three providers, this is now systemically important payments infrastructure that deserves banking-grade prudential oversight alongside TCRA's technical regulation.

For commercial banks

The addressable market is not shrinking — it is moving. Banks that build genuinely seamless wallet-to-account products, mobile-money-based credit scoring, and low-friction savings sweeps stand to convert mobile money's 87 million users into deposit and credit customers rather than losing them to the informal float economy.

For investors & fintechs

With account-acquisition growth decelerating (5.38% QoQ, down from 21.6%), the next wave of value creation sits in merchant payments, embedded credit, savings products and cross-border remittances layered on top of the existing mobile money base — not in signing up more wallet-holders.

For a broader view of how financial-sector deepening fits into the wider debate on Tanzania's growth trajectory and the policy gaps standing between the country and its US$1 trillion, US$7,000-per-capita 2050 ambition, see TICGL's dedicated analysis linked above and in the related reading section below.

05 — Supporting DataFull Communications Sector Dashboard

Mobile money doesn't grow in isolation — it rides on the back of Tanzania's broader telecom expansion. The table below sets the mobile money numbers in the context of the full sector, quarter ending June 2026 vs March 2026.

Mobile + fixed lines

117.0M

+4.51% QoQ, 167.0% penetration

Internet subscriptions

62.79M

+6.48% QoQ, 89.7% penetration

Smartphones in use

31.34M

+5.16% QoQ — 44.7% penetration

Data consumed (quarter)

1,041 PB

+11.65% QoQ

Table: Tanzania communications sector headline indicators
Indicator	Mar 2026	Jun 2026	Change
Mobile + fixed telephone lines	111.9M	117.0M	+4.51%
Telephone penetration	159.8%	167.0%	+7.2pp
Internet subscriptions	58.97M	62.79M	+6.48%
Data consumed (quarter)	932 PB	1,041 PB	+11.65%
National voice minutes	45.44B	48.82B	+7.44%
Domestic SMS	55.10B	55.05B	-0.05%
Mobile money active accounts	80.98M	87.05M	+7.5%
Mobile money transactions (quarter)	1,991,494,385	2,098,706,145	+5.38%
Paid decoders (DTH+DTT)	2.09M	2.26M	+8.18%
Fraud attempts reported	9,816	7,334	-25.3%
Active telecom licences	—	1,881	n/a

06 — Supporting DataThe Connectivity Behind the Mobile Money Boom

Mobile money's growth is only possible because of cheap, widely available mobile data and near-universal phone ownership. In June 2026, the average in-bundle data tariff across all five mobile operators was TZS 2.05 per MB (roughly US$0.81 per GB) — cheap enough to place Tanzania among Africa's more affordable data markets and under the global "1-for-2" affordability benchmark (data costing 2% or less of average monthly income). Out-of-bundle pricing, at TZS 9.35 per MB (roughly US$3.68/GB), remains far more expensive and disproportionately affects casual, lower-income users — often the same users most dependent on mobile money precisely because they lack a bank account.

Mobile & Internet Subscriptions: Trend

Total mobile+fixed lines and internet subscriptions, quarterly (millions)

Smartphone vs Basic Phone Penetration

June 2026 — the device gap behind uneven mobile money usage patterns

Notably, only 44.7% of the population owns a smartphone, while mobile penetration overall (including basic/feature phones) is 83.4% — a reminder that most mobile money transactions in Tanzania still happen over USSD on basic handsets, not banking apps. This is precisely why mobile money has outpaced formal banking in reach: it was built to work on the cheapest, most widely owned device in the country.

Infrastructure headroom

Tanzania's international internet gateway capacity stands at 17,690 Gbps, of which only 15.4% is in use — leaving 84.6% spare capacity. Average mobile download speed across 22 measured locations is 14.26 Mbps, with average latency of 76.79ms. 5G population coverage reached 34.18%, but geographic coverage is only 11.34% of Tanzania's land area — meaning both connectivity and mobile-money agent networks remain concentrated where people already live, not evenly across the country.

07 — Supporting DataTrust in the System: Fraud & Network Reliability

Trust is the currency mobile money runs on — and this quarter's data is encouraging. Reported fraud attempts fell 25.3% quarter-on-quarter to 7,334 cases, even as transaction volumes rose. Network quality-of-service compliance averaged 96.6% across operators, with TTCL (98.1%) leading and Halotel (94.5%) trailing.

Fraud Attempts: Quarterly Trend

Total reported fraud attempts across all operators

Fraud Attempts by Region

June 2026 quarter, top 8 regions by volume

Rukwa (2,495) and Morogoro (2,129) recorded by far the highest fraud-attempt counts nationally — together over 63% of all reported cases — concentrated in specific districts (Sumbawanga, Rukwa; and Kilombero, Morogoro), useful intelligence for both operators' fraud teams and financial-sector regulators monitoring emerging risk hotspots.

08 — Supporting DataBroadcasting & Postal: Brief Context

Broadcasting

Paid decoder subscriptions rose 8.18% to 2.26 million, with satellite (DTH) now 75.8% of decoders versus 24.2% terrestrial (DTT). Cable TV connections fell 8.18% to 16,347 as households migrate to satellite and streaming. All monitored TV and radio broadcasters met the 60% local-content quota, though only 38% of TV channels fully adhered to their submitted programme schedules.

Postal & Courier

Domestic mail volumes softened (-9.9% sent, -1.6% received) as digital channels substitute for physical mail, while cross-border parcel volumes surged (+40.8% sent, +52.2% received) — a clear signature of rising cross-border e-commerce, itself increasingly paid for via mobile money.

09 — TICGL ViewOutlook: A Fork in the Road for Tanzania's Financial System

Tanzania's mobile money sector has already answered the "access" question — nearly every adult with a phone can now transact digitally. The question this data leaves open is a "depth" question: will the 87 million active wallets, and the transaction data they generate, become the foundation for deeper formal savings, credit and insurance markets — or will they remain a parallel, largely self-contained payments economy that banks struggle to fully connect to? The direction of travel over the next few quarters — interoperability rules, bank-fintech partnerships, and how effectively e-money float is channelled into the formal credit system — will determine which path Tanzania takes, with direct consequences for the depth and resilience of its financial sector, and by extension its Dira 2050 growth ambitions.

10 — Quick AnswersFrequently Asked Questions

Is mobile money bigger than banking in Tanzania?

By transaction count and active-user reach, yes — 87.05 million active accounts processed over 2.1 billion transactions in the quarter ending June 2026, a footprint far exceeding Tanzania's commercial bank account base. By total assets held and formal credit issued, banks remain larger.

How many mobile money accounts does Tanzania have in 2026?

87.05 million active accounts as of June 2026, up 7.5% from 80.98 million in March 2026. M-Pesa, Mixx by Yas and Airtel Money together hold about 89% of the market.

Does mobile money growth hurt bank deposits in Tanzania?

It creates a structural risk of deposit disintermediation if e-money float isn't efficiently channelled back into the formal banking system through trust-account arrangements. As more routine cash flow settles in mobile wallets, banks can see slower deposit growth unless interoperability with banks is strong.

Is mobile money transaction growth slowing down in Tanzania?

Yes — quarter-on-quarter transaction growth decelerated from 21.6% in September 2025 to 5.38% in June 2026, signalling the market is moving from rapid account acquisition to a more mature, usage-intensity phase.

11 — MethodologySources & Notes

Primary data: Tanzania Communications Regulatory Authority (TCRA), Ripoti ya Hali ya Sekta ya Mawasiliano — Robo Mwaka Inayoishia Juni 2026 ("State of the Communications Sector Report, Quarter Ending June 2026").
The "mobile money vs bank" transaction-frequency comparison chart is TICGL's own illustrative estimate, clearly labelled, since TCRA's report does not include comparable bank-transaction statistics.
USD conversions use an indicative exchange rate of approximately TZS 2,600 = US$1 (August 2026).
This page is an independent analytical summary prepared by TICGL/TERI and does not constitute financial, investment or legal advice.

Muhtasari

Muhtasari kwa Kiswahili

Je, Pesa Mtandao Inazidi Mabenki Tanzania? Katika robo mwaka iliyoisha Juni 2026, akaunti za pesa mtandao ziliongezeka kwa asilimia 7.5 kufikia milioni 87.05 — idadi kubwa kuliko watu wazima wote nchini — na kufanya miamala zaidi ya bilioni 2.1 ndani ya robo moja tu. Kasi hii ni kubwa kuliko ukuaji wa akaunti za benki za kawaida, jambo linaloibua swali muhimu: je, pesa mtandao inasaidia kukuza mfumo rasmi wa kifedha, au inauondolea mabenki fedha ambazo zingeweza kuwa amana za benki?

Uchambuzi wa TICGL unaonesha kuwa jambo hili lina pande mbili. Kwa upande mmoja, pesa mtandao imefanikisha ujumuishaji mkubwa wa kifedha (financial inclusion) kwa kasi ambayo mabenki ya kawaida hayajawahi kufikia — watu wengi wanaweza kutuma, kupokea na kuhifadhi fedha bila kuhitaji akaunti ya benki. Kwa upande mwingine, fedha nyingi zinazopita kwenye mitandao ya simu badala ya mabenki zinaweza kupunguza amana (deposits) ambazo mabenki hutegemea kutoa mikopo, hasa ikiwa hakuna muunganiko mzuri (interoperability) kati ya mifumo ya pesa mtandao na mabenki. Watoa huduma watatu — M-Pesa, Mixx by Yas na Airtel Money — wanamiliki asilimia 89 ya soko, hali inayoongeza umuhimu wa usimamizi imara wa Benki Kuu (BOT) na TCRA katika eneo hili.

Akaunti za pesa mtandao: milioni 87.05 (ongezeko la asilimia 7.5)
Miamala ya robo mwaka: zaidi ya bilioni 2.1 (ongezeko la asilimia 5.38)
Watoa huduma watatu wanamiliki asilimia 89 ya soko
Majaribio ya ulaghai yalipungua kwa asilimia 25.3 — ishara ya kuimarika kwa uaminifu wa mfumo

Chanzo: TCRA, Ripoti ya Hali ya Sekta ya Mawasiliano, Robo Mwaka Inayoishia Juni 2026. Uchambuzi umeandaliwa na Idara ya Utafiti ya TICGL / Tanzania Economic Research Institute (TERI).

Executive Summary

This study examined the tax-policy instruments through which Tanzania's Dira 2050 and its Long-Term Perspective Plan (LTPP) 2026/27–2050/51 intend to fund the country's USD 1 trillion economic ambition while simultaneously formalising an informal sector that contributes an estimated 55 percent of GDP. It asks a narrow but consequential question: are the tax measures aimed at Micro, Small and Medium Enterprises (MSMEs) — the same measures meant to move citizens from survival to ownership — capable of generating the domestic revenue Dira 2050 needs, or are they being asked to do a fiscal job they cannot realistically perform while imposing a real compliance cost on the citizens formalisation is meant to benefit?

The study finds that Tanzania's tax-to-GDP ratio, at approximately 12.9–13.1 percent, remains well below the Sub-Saharan Africa average of 15–18 percent, and that two official processes currently set different 2050 targets for closing that gap: the LTPP targets 25 percent, while the Presidential Commission on Tax Reforms, which submitted 284 recommendations to the President in March 2026, targets 22 percent. Compounding this, Tanzania's own active taxpayer registry contracted from 3.3 million in 2021/22 to 2.18 million in 2024/25 even as formalisation campaigns continued, and comparative evidence from Kenya and Uganda shows that presumptive and turnover-tax regimes aimed at the smallest enterprises typically raise negligible direct revenue relative to the compliance burden they impose.

Applying a four-dimensional tax-policy framework — revenue yield, compliance burden, formalisation incentive, and equity — to six tax channels under Dira 2050, the study finds that no channel currently rates strongly on both revenue yield and compliance burden simultaneously: the instruments capable of raising material new revenue (exemption rationalisation, large-taxpayer administration) are largely separate from the instruments aimed at MSMEs and formalisation. Tanzania's own 2021 mobile money transaction levy, which cut peer-to-peer transaction volumes by roughly 38 percent within three months before being repeatedly reduced and then largely scrapped, stands as a directly relevant domestic precedent for the risks of miscalibrated digital taxation that Dira 2050's own digital-tax provisions do not reference.

The report concludes with six recommendations centred on reconciling the two conflicting tax-to-GDP targets, decoupling the MSME formalisation agenda from the domestic-revenue agenda, and applying the lessons of Tanzania's own mobile money levy episode to future digital-tax design.

Related TICGL Analysis

What's Next for Tanzania's Economy? The Policy Gaps Keeping $1 Trillion Out of Reach by 2050

This tax-policy study is one part of a wider structural picture. Read TICGL's flagship analysis of the policy gaps standing between Tanzania and its Dira 2050 ambition — including the financing, institutional, and investment-climate gaps that sit alongside the tax questions raised here.

Read the Full Policy Gap Analysis →

1. Background and Context

Dira 2050 requires financing on a scale far beyond anything Tanzania has previously mobilised: the LTPP estimates investment needs rising from USD 183 billion under the fourth Five-Year Development Plan to USD 1.58 trillion under the eighth, with total investment averaging more than 35 percent of GDP annually. Of this, the LTPP projects that domestic revenue, including tax collection, will cover only around 22 percent of financing needs, with foreign direct investment expected to mobilise roughly 57 percent and the domestic private sector the remaining 21 percent.

How Dira 2050's USD 1.58 Trillion Investment Need Is Expected to Be Financed

Source: LTPP 2026/27–2050/51 financing projections, as reported in the study.

The LTPP is candid that this gap has been long-standing and structural. Tanzania's tax-to-GDP ratio averaged approximately 12 percent between 2018 and 2024, against a Sub-Saharan Africa average of 16.3 percent, and stood at 12.9 percent in 2024. The Plan attributes this partly to administrative inefficiencies, tax exemptions with limited demonstrated impact on growth, and limited taxation of the informal sector and parts of agriculture — the same informal sector that the companion analysis of Dira 2050's citizen-ownership channels found contributes up to 55 percent of GDP while remaining largely outside the formal tax net.

This creates the specific tension this study investigates. The LTPP's own formalisation agenda proposes to bring millions of informal MSMEs into the tax system through a dedicated TRA support wing, a graduated tax system, and simplified compliance. This report asks the fiscal question directly: even if formalisation succeeds on its own terms, can taxing millions of newly formalised micro-enterprises realistically close a tax-to-GDP gap of 12 to 13 percentage points, or does relying on MSME taxation for that purpose risk imposing a real compliance cost on ordinary citizens for a fiscal return that comparative evidence suggests will be marginal?

1.1 Current Situation: Baseline Snapshot

Before assessing Dira 2050's forward-looking targets, this study establishes the current tax-policy baseline, drawing on the LTPP's own data, the Presidential Commission on Tax Reforms' March 2026 report, and Bank of Tanzania and Ministry of Finance data.

Table 1: Tax-policy baseline across six channels
Channel	Current Situation (Baseline)
MSME & informal-sector taxation	The informal sector contributes an estimated 55 percent of GDP and absorbs roughly 72 percent of the workforce (2023–24), largely outside the tax net. Over four million businesses reportedly remain informal, citing complex tax procedures as a primary barrier.
Fiscal sustainability / tax-to-GDP ratio	Tanzania's tax-to-GDP ratio stood at 12.9 percent in 2024 (13.1 percent by some FY2024/25 measures), against a Sub-Saharan Africa average of 15–18 percent and an EAC average of 12.7 percent. The fiscal deficit has averaged around 3.4–3.5 percent of GDP over the past five years.
Taxpayer base	The number of active registered taxpayers fell from 3.3 million in 2021/22 to 2.18 million in 2024/25, even as formalisation campaigns continued over the same period.
Tax exemptions & incentives	Tax exemptions are estimated to cost Tanzania approximately 2–3 percent of GDP in foregone revenue, with limited demonstrated impact on economic growth, and disparities flagged in how incentives are allocated relative to the 2022 Investment Act's guidelines.
Digital & mobile-money taxation	A mobile money transaction levy introduced in July 2021 cut monthly peer-to-peer transaction volumes by roughly 38 percent within three months; reduced by 30 percent in September 2021, a further 43 percent in July 2022, and largely scrapped for most transfers from October 2022.
Institutional reform	The Presidential Commission on Tax Reforms, established October 2024 and chaired by Ambassador Ombeni Sefue, submitted a report to President Samia Suluhu Hassan on 18 March 2026 with 284 reform proposals, including renaming TRA to the Tanzania Revenue Service and a one-year tax grace period for startups.

2. Diagnostic Findings: The Policy Problem

A close reading of the LTPP alongside the Presidential Commission on Tax Reforms' 2026 report and Tanzania's own recent fiscal history surfaces four structural tensions that this study identifies as the central tax-policy problem for Dira 2050's implementation:

Two unreconciled tax-to-GDP targets. The LTPP sets a target of raising Tanzania's tax-to-GDP ratio from 12.9 percent to at least 25 percent by 2050. The Presidential Commission on Tax Reforms separately sets a target of 22 percent for the same year — two different official benchmarks for the same indicator over the same horizon, with no public reconciliation between the two processes.
A contracting taxpayer base alongside expanding formalisation ambitions. Active registered taxpayers fell from 3.3 million in 2021/22 to 2.18 million in 2024/25 — a decline of roughly a third — during the same period formalisation campaigns and digital tax systems were being expanded.
A revenue-yield-versus-compliance-cost mismatch confirmed by regional evidence. Kenya's turnover tax generated only an estimated 0.002 percent of GDP in 2023 despite the compliance obligations it placed on hundreds of thousands of small traders. Uganda's presumptive tax regime imposes compliance costs averaging around USD 510 per year even on firms filing nil returns, and 68 percent of eligible SMEs remain outside the tax net regardless.
An unreferenced domestic precedent on digital taxation. Tanzania's own 2021 mobile money transaction levy cut monthly peer-to-peer transaction volumes by roughly 38 percent within three months. Despite this direct national experience, the LTPP's digital-tax provisions (targeting e-commerce and digital-trade taxation by 2040) do not reference this precedent.

Left unresolved, these four tensions risk a scenario in which Tanzania succeeds at registering enterprises and improving inclusion — without closing the actual tax-to-GDP gap Dira 2050's financing model depends on.

3. Analytical Framework Applied in This Study

To assess Dira 2050's tax-policy instruments consistently, this study applied a four-dimensional working framework, structuring both the channel-level findings and the synthesis matrix below.

3.1

Revenue Yield

The extent to which an instrument is capable of generating material, measurable domestic revenue relative to Tanzania's financing needs — as distinct from the number of taxpayers registered.

3.2

Compliance Burden

The time, cost, and administrative complexity an instrument imposes on taxpayers, particularly MSMEs — frequently a stronger determinant of formalisation behaviour than the statutory tax rate itself.

3.3

Formalisation Incentive

Whether an instrument's net effect, once compliance burden and support are weighed together, makes voluntary formalisation more or less attractive to an informal operator.

3.4

Equity

Whether the burden of an instrument falls proportionately, or disproportionately, on smaller taxpayers, women-led enterprises, and lower-income citizens.

This framework separates two objectives that Dira 2050's own language sometimes treats as one: formalising the informal sector (a structural, inclusion-oriented goal) and closing the tax-to-GDP gap (a fiscal, revenue-oriented goal).

4. Study Objectives and Scope

Overall objective: to analyse the tax-policy instruments Dira 2050 and the LTPP rely on to formalise Tanzania's informal sector and fund the country's fiscal ambitions, and establish whether these instruments can deliver both objectives simultaneously, or should be sequenced separately.

Mapped and analysed the principal tax-policy instruments: the MSME/TRA graduated tax wing, the tax-to-GDP fiscal target, exemption management, digital tax systems, LGA revenue autonomy, and mining/extractive royalty transparency.
Assessed each instrument against the four-dimensional tax-policy framework.
Benchmarked Tanzania against Kenya's turnover tax, Uganda's presumptive tax regime, and Rwanda's digital tax administration, and against Tanzania's own 2021–2022 mobile money levy episode.
Identified the inconsistency between the LTPP's 25 percent and the Commission's 22 percent tax-to-GDP targets, alongside the taxpayer-base contraction running alongside both.
Developed sequenced tax-policy recommendations separating the formalisation objective from the domestic-revenue objective.

6. Comparative Findings: Lessons from Other Economies

Tanzania is not alone in trying to tax its informal and small-business sector into the formal system while also raising material new domestic revenue. A review of comparable regional and cross-country experience offers concrete, quantified lessons for how Dira 2050's tax instruments are designed.

Table 2: Comparative regional tax-policy experience
Country / Region	Relevant Experience	Key Lesson for Dira 2050
Kenya	Turnover tax on small businesses, introduced 2008 at 3 percent on annual turnover between roughly USD 5,000–50,000, generated an estimated 0.002 percent of GDP in 2023.	Presumptive taxes targeted at the smallest enterprises are unlikely to be a meaningful direct revenue source; evaluate on formalisation outcomes, not revenue.
Uganda	Presumptive tax regime (since 1997) imposes average compliance costs of ~USD 510/year even on nil returns; 68 percent of eligible SMEs remain outside the tax net.	Compliance cost and administrative burden, not the statutory rate, are usually the binding constraint on formalisation.
Rwanda	The Rwanda Revenue Authority's e-Tax online filing, paired with SME-targeted training, is associated with improved compliance and revenue collection.	Digitalisation of tax administration works when paired with active taxpayer education; introduced alone, it risks excluding the least digitally literate operators.
Sub-Saharan Africa	An estimated 65 percent of regional tax authorities operate a simplified or presumptive small-business regime; cross-country reviews find these raise little revenue relative to administrative cost.	Design and evaluate Tanzania's MSME tax wing primarily as an inclusion instrument, with a separate revenue plan.

Tanzania's Tax-to-GDP Ratio vs. Regional Benchmarks and 2050 Targets

Figures in percent of GDP. SSA range shown as reported low–high band; Tanzania 2024 figure and both 2050 targets from the LTPP and the Presidential Commission on Tax Reforms.

Tanzania's Active Taxpayer Registry, 2021/22 vs 2024/25

Source: Ministry of Finance data, as cited in the study. Decline of roughly one-third over three years.

7. Findings: Six Tax-Policy Channels under Dira 2050

Applying the framework in Section 3, this study analysed six tax-policy channels through which Dira 2050 and the LTPP intend to formalise the informal sector and mobilise domestic revenue.

7.1 MSME Tax Wing and the Graduated Tax System

The LTPP proposes a dedicated MSME wing within the TRA offering simplified, digitised tax filing, reduced initial tax burden on newly formalised businesses, and tax credits of up to 30 percent for firms creating 500+ jobs, alongside a national digital MSME database by 2030.

Strength identified

Directly targets the compliance-cost barrier that comparative evidence (Uganda) identifies as the single biggest deterrent to formalisation.

Structural gap / risk

Comparable regimes elsewhere (Kenya's 0.002 percent of GDP) generate negligible direct revenue. If Tanzania's 25 percent target implicitly assumes material MSME revenue, that assumption is not supported by comparative evidence.

7.2 Fiscal Sustainability and the Tax-to-GDP Target

The LTPP targets raising the tax-to-GDP ratio from 12.9 percent to at least 25 percent by 2050, alongside reducing public debt to 40 percent of GDP and containing the fiscal deficit to 1–3 percent of GDP.

Strength identified

Directionally consistent with the Tax Reform Commission's own recommendations; both processes agree administrative inefficiency and informality, not statutory rates, are the primary drags on revenue.

Structural gap / risk

The LTPP's 25 percent and the Commission's 22 percent targets for 2050 are not reconciled in any public document reviewed, risking inconsistent Five-Year Development Plan monitoring.

7.3 Tax Base Erosion: The Shrinking Taxpayer Registry

Active registered taxpayers fell from 3.3 million (2021/22) to 2.18 million (2024/25), even as formalisation campaigns and digital tax systems expanded over the same period.

Strength identified

The trend has been acknowledged publicly by senior finance officials, and the Commission's recommendations (simplified registration, a one-year startup grace period) directly respond to the likely cause.

Structural gap / risk

New formalisation drives risk running in place rather than expanding net registration, unless the causes of the existing contraction are diagnosed first.

7.4 Tax Exemptions and Incentive Rationalisation

Tax exemptions are estimated to cost Tanzania approximately 2–3 percent of GDP in foregone revenue, with the LTPP itself noting limited demonstrated growth impact.

Strength identified

The clearest area of consensus between the LTPP and the Tax Reform Commission, and the single largest identified pool of recoverable revenue without raising any statutory rate on MSMEs.

Structural gap / risk

Incentives tend to be allocated to larger, better-connected investors; rationalisation requires sustained political will that multiple years of similar recommendations have not yet delivered.

7.5 Digital Tax Systems and the Mobile Money Levy Precedent

Tanzania has progressively digitalised tax administration since 2013, and the LTPP plans further digitalisation to curb e-commerce tax evasion by 2040 — while the 2021 mobile money levy remains a cautionary domestic precedent.

Strength identified

Rwanda's experience shows digitalisation paired with taxpayer education can materially improve compliance, and Tanzania's 60+ million mobile money accounts provide a strong platform if designed carefully.

Structural gap / risk

The LTPP's digital-tax provisions do not reference the 2021–2022 levy experience or set out safeguards against repeating a sharp, self-defeating drop in transaction volumes.

7.6 Local Government Revenue Autonomy

The LTPP calls for strengthening LGA revenue collection through enhanced fiscal autonomy, while the Tax Reform Commission separately flags overlapping mandates between central (TRA) and local authorities.

Strength identified

Greater LGA fiscal autonomy is consistent with the decentralised, citizen-led governance channel identified as needing strengthening.

Structural gap / risk

Without first harmonising central and local instruments, expanding LGA revenue risks adding another charge layer on the same small, already-overburdened taxpayer pool.

Tanzania's 2021–2022 Mobile Money Levy: Transaction Volume Recovery Path

Illustrative index (100 = pre-levy baseline volume) built from the reported percentage impacts and reductions at each stage; not a precise monthly series.

8. Summary of Key Findings

Synthesising the channel-level findings against the four-dimensional tax-policy framework produces the matrix below. Ratings reflect this study's assessment: Strong (well evidenced to perform on this dimension), Emerging (directed at this dimension but not yet consolidated), and Weak (does not currently address this dimension, or evidence suggests it is unlikely to).

Table 3: Synthesis matrix — six channels against the four-dimensional framework
Channel	Revenue Yield	Compliance Burden	Formalisation Incentive	Equity
MSME tax wing / graduated tax	Weak	Emerging	Emerging	Emerging
Tax-to-GDP fiscal target	Strong (aspiration)	Weak	Weak	Weak
Taxpayer base erosion response	Weak	Emerging	Weak	Emerging
Exemption rationalisation	Strong (potential)	Emerging	Weak	Emerging
Digital tax systems	Emerging	Emerging	Weak	Weak
LGA revenue autonomy	Emerging	Weak	Weak	Weak

Synthesis Matrix Visualised: Rating Score by Channel and Dimension

Scores: Weak = 1, Emerging = 2, Strong = 3 — a visual translation of Table 3 above.

Two patterns stand out. First, the two channels rated Strong on revenue yield — the headline tax-to-GDP target and exemption rationalisation — are macro-level and administrative in nature, not MSME-focused; no MSME-targeted instrument rates above Weak on revenue yield. Second, no channel rates Strong on compliance burden, meaning the barrier comparative evidence identifies as most decisive for formalisation behaviour is not yet the primary design focus of any Tanzanian tax instrument reviewed.

9. Study Approach

This study is based on a structured desk review of the LTPP's fiscal and formalisation chapters, cross-referenced against the Presidential Commission on Tax Reforms' March 2026 report and recent Ministry of Finance and Bank of Tanzania data, combined with a comparative review of published research and policy analysis on MSME and presumptive taxation in Kenya, Uganda, and Rwanda, and documented reporting on Tanzania's own 2021–2022 mobile money levy episode. The four-dimensional tax-policy framework in Section 3 was applied consistently across all six channels to produce the findings in Section 7 and the synthesis matrix in Section 8.

9.1 Basis of the Findings

Direct textual analysis of the LTPP's fiscal sustainability and informal-sector formalisation chapters and their target tables.
Cross-referencing against the Presidential Commission on Tax Reforms' March 2026 report and contemporaneous news coverage of its recommendations.
Comparative analysis of published research on MSME and presumptive tax regimes in Kenya, Uganda, and Rwanda, and of documented reporting on Tanzania's 2021–2022 mobile money levy.

9.2 Scope and Limitations

This is a desk-based comparative policy analysis; it does not include new primary fieldwork or key-informant interviews with taxpayers, TRA officials, or MSME associations. The ratings in Section 8 are this study's analytical judgement based on the design of the instruments as written and on comparative evidence, not a direct measurement of Tanzanian outcomes on the ground.
Tax-to-GDP figures for Tanzania vary slightly by source and year (12.8–13.7 percent across sources reviewed) depending on methodology and fiscal year; this study reports the range transparently rather than resolving it to a single figure.
The Presidential Commission's 284 recommendations were reviewed through public reporting of the March 2026 submission rather than the full unpublished report; specific recommendation numbering and detail may be refined as the report is formally released and acted upon.

How Does Tax Policy Shape Ordinary Citizens' Direct Participation in Tanzania's Dira 2050?

Dira 2050's promise is not just macroeconomic growth, but that ordinary citizens move from mere survival to genuine economic ownership. Tax policy is one of the six participation channels through which that promise is meant to be delivered — and this study's findings speak directly to it. Formalisation is often presented as the mechanism that pulls an informal trader into the visible, protected economy: once registered, an MSME can, in principle, access credit, legal protection, and market linkages it could not reach informally.

But this study's channel-level findings (Section 7.1) and the companion 'From Survival to Ownership' report both point to the same caution: the MSME tax wing currently rates only Emerging, not Strong, on formalisation incentive — meaning the pathway from informal survival to formal ownership is directed at, but not yet consolidated for, the ordinary citizen it is meant to serve. For a smallholder trader or micro-entrepreneur, direct participation in Dira 2050 through the tax channel currently means facing simplified — but still real — compliance obligations, in exchange for a formalisation and inclusion benefit that is better evidenced than any revenue benefit to the state. Treating that trade-off honestly, rather than assuming formalisation simultaneously solves both the citizen's inclusion problem and the state's revenue problem, is what this study's separation of the two agendas (Recommendation 2) is designed to protect.

10. Contribution of This Study

A diagnostic assessment of the strengths and structural gaps associated with each of the six tax-policy channels under Dira 2050, organised around the four-dimensional revenue–compliance–formalisation–equity framework.
A synthesis matrix (Section 8) showing that Tanzania's MSME-focused tax instruments and its material-revenue instruments are largely distinct, contrary to the LTPP's narrative framing of formalisation as a primary revenue strategy.
Identification of a specific, previously unreconciled inconsistency between the LTPP's 25 percent and the Presidential Commission's 22 percent tax-to-GDP targets for 2050.
A direct link between Tanzania's own 2021–2022 mobile money levy experience and the design safeguards its future digital-tax measures should adopt.

11. Policy Recommendations

Based on the findings above, this study recommends six actions, sequenced by urgency:

12. Recommended Implementation Roadmap

0–12 months

Phase 1: Immediate Corrective Action

Reconcile the 22 percent / 25 percent tax-to-GDP target inconsistency (Recommendation 1); publish an exemption-by-exemption cost-benefit register (Recommendation 6).

Year 1–2

Phase 2: Diagnosis and Safeguard Design

Diagnose the taxpayer-base contraction (Recommendation 3); design a consultation-and-piloting protocol for any new digital or e-commerce tax measure (Recommendation 4).

Year 2–3

Phase 3: Harmonisation and Rollout

Harmonise TRA and LGA revenue instruments (Recommendation 5); roll out the MSME tax wing evaluated on formalisation and inclusion KPIs rather than revenue KPIs (Recommendation 2).

Ongoing from Year 3

Phase 4: Institutionalisation

Embed transparent exemption reporting and pre-agreed levy-adjustment triggers as standing fiscal governance practice.

13. Conclusion

Dira 2050's financing model depends on closing a persistent, decades-long tax-to-GDP gap, and its formalisation agenda offers a genuine route to bring millions of informal MSMEs into a system that can support them with credit, market linkages, and legal protection. This study finds, however, that the same instruments cannot be assumed to deliver both formalisation and material new domestic revenue at once: comparative regional evidence and Tanzania's own recent taxpayer-base trends both indicate that MSME-focused tax measures are, at best, a modest revenue contributor, while the largest realistic domestic-revenue gains lie in exemption rationalisation and administration of the existing tax base. Recognising this distinction — and applying the direct lesson of Tanzania's own 2021–2022 mobile money levy episode to future digital-tax design — would allow the formalisation agenda to proceed on its real strength, citizen inclusion and ownership, without being asked to also close a fiscal gap it is not well suited to closing alone.

Muhtasari kwa Kiswahili

Lengo la utafiti: Utafiti huu unachunguza kama sera za kodi zinazolenga MSME chini ya Dira 2050 zinaweza kufanikisha malengo mawili kwa wakati mmoja — kurasimisha sekta isiyo rasmi na kuongeza mapato ya ndani — au kama malengo hayo yanapaswa kutekelezwa kwa hatua tofauti.

Matokeo makuu: Uwiano wa kodi kwa Pato la Taifa (tax-to-GDP) wa Tanzania ni asilimia 12.9, chini ya wastani wa Afrika Kusini mwa Jangwa la Sahara (asilimia 15–18). Malengo mawili tofauti ya mwaka 2050 yapo — LTPP inalenga asilimia 25, wakati Tume ya Rais ya Marekebisho ya Kodi inalenga asilimia 22 — bila upatanisho rasmi.

Changamoto ya walipa kodi: Idadi ya walipa kodi waliosajiliwa imepungua kutoka milioni 3.3 (2021/22) hadi milioni 2.18 (2024/25), licha ya kampeni za urasimishaji kuendelea.

Fundisho la tozo ya miamala ya simu: Tozo ya mwaka 2021 ilipunguza miamala ya pesa za simu kwa asilimia 38 ndani ya miezi mitatu, ikapunguzwa mara kadhaa, na hatimaye kufutwa kwa kiasi kikubwa 2022 — somo muhimu kwa kodi za kidijitali zijazo.

Mapendekezo: Ripoti inapendekeza hatua sita, zikiwemo kupatanisha malengo mawili ya tax-to-GDP, kutenganisha ajenda ya urasimishaji wa MSME na ajenda ya mapato ya ndani, kuchunguza sababu za kupungua kwa walipa kodi, na kutumia fundisho la tozo ya simu kwenye kodi za kidijitali zijazo.

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Frequently Asked Questions

Can MSME formalisation alone close Tanzania's tax-to-GDP gap?

No — this study finds no structural reason to expect Tanzania's MSME tax wing to raise material direct revenue, even if it succeeds as a formalisation tool. Comparable regimes in Kenya (0.002 percent of GDP in 2023) show presumptive taxes aimed at the smallest enterprises typically raise negligible revenue relative to the compliance burden they impose.

What is Tanzania's current tax-to-GDP ratio compared to its 2050 target?

Approximately 12.9 percent in 2024, against an LTPP target of 25 percent and a Presidential Commission target of 22 percent for 2050 — two unreconciled official benchmarks.

Why did Tanzania's taxpayer registry shrink between 2021 and 2025?

Active registered taxpayers fell from 3.3 million to 2.18 million, even as formalisation campaigns expanded. Officials have publicly attributed part of this to the overburdening of a small pool of existing taxpayers.

What happened with Tanzania's 2021 mobile money transaction levy?

It cut monthly peer-to-peer transaction volumes by roughly 38 percent within three months, was reduced three times, and was largely scrapped for most transfers by October 2022 following public and legal pushback.

Which tax-policy instruments generate the most realistic domestic revenue?

Exemption rationalisation (worth an estimated 2–3 percent of GDP) and stronger administration of the existing large-taxpayer base — not MSME-focused instruments.

References

United Republic of Tanzania. Long-Term Perspective Plan (LTPP) 2026/27–2050/51: Pathways to Prosperity (Dira 2050).
The Citizen (Tanzania). Tax commission proposes 284 changes to reform Tanzania's tax system, 18 March 2026.
TanzaniaInvest. Presidential Commission Proposes 284 Measures to Overhaul Tanzania Tax System, March 2026.
The EastAfrican. Tanzania tax review warns of trust erosion, proposes sweeping overhaul, March 2026.
PwC Tanzania. Broadening Tanzania's Tax Base (press release).
TICGL. Why Tanzania Must Expand Its Tax Base; Tanzania Tax Revenue, Government Role & Private Sector-Driven Development.
Brookings Institution. Designing Simplified Tax Regimes to Work for Women's Economic Empowerment.
UNU-WIDER Working Paper 2021/163. An Assessment of Presumptive Tax in Uganda.

Channel	Current Situation (Baseline)
Informal sector	Contributes an estimated 55% of GDP (2023) and absorbs roughly 72% of the workforce — about 25.95 million people (TICGL, 2024); other cited estimates range as high as 80% of the workforce. Without intervention, the LTPP projects informality could rise to 58.5% of GDP by 2050.
Cooperatives	A long-established sector across agriculture, fisheries, mining, housing, and finance, but currently constrained by governance inefficiencies, outdated management practices, and limited market-access capacity. Coop Bank Tanzania has only recently been established.
Middle class	About 12% of Tanzanians self-identify as middle-income, but fewer than 3% are formally captured as such under internationally comparable consumption-based measures (2023) — roughly a nine-to-one gap between perception and formal classification.
Land and property rights	Only about 20% of land nationally is surveyed or titled, and only 30% of the population lives in planned settlements. Of Tanzania's 94.5 million hectares of land, 44 million hectares are suitable for agriculture, yet only 24% of that suitable land is currently utilised.
Digital economy & financial inclusion	2023: financial inclusion 76% vs exclusion 24%; formal bank account ownership 22%; mobile money account ownership 72%; broadband coverage 83%; over 67 million mobile subscriptions; 34.5 million internet users; mobile money transactions of roughly TZS 155 trillion (BoT).
Decentralised governance	Local Government Authorities operate with constrained fiscal autonomy and uneven capacity; participatory planning and citizen scorecard mechanisms remain at an early, largely pilot stage rather than a standing national system.

Country / Region	Relevant Experience	Key Lesson for Dira 2050
Rwanda	Long-standing citizen-centred governance built on home-grown participatory instruments (community-based savings, performance contracts, community courts) alongside a UMIC-by-2035 ambition.	Citizen ownership is easier to sustain when anchored in durable, locally owned institutions rather than one-off national campaigns.
South Africa	One of the most significant reductions in non-agricultural informal employment recorded on the continent (2001–2015), through sustained labour-market and social-protection reform.	Formalisation is a multi-decade structural process; Dira 2050's 2030 milestones should be read as intermediate steps, not a stand-alone target year.
Indonesia	Roughly a third of GDP and well over half the workforce remain informal; policy has shifted toward industrialising rural informal activity rather than registration incentives alone.	Formalisation succeeds when paired with productivity-raising investment; incentives alone risk formalising firms that cannot survive the added compliance cost.
Vietnam	Despite steady UMIC-oriented reform, informal employment has remained above two-thirds of the workforce, partly due to very small, low-capacity firms.	A segmented approach is needed: the smallest operators may require social protection and productivity support before formalisation is realistic.
Kenya & Ethiopia	Multiple studies find agricultural cooperative membership raises smallholder income, market bargaining power, and women's economic empowerment.	Cooperative-led ownership models work, but require deliberate design (capacity-building, governance safeguards) so smallholder and women members share proportionally in the gains.

Channel	Asset Ownership	Enterprise Ownership	Income / Social Protection	Voice / Governance
Formalisation of the informal sector	Weak	Emerging	Weak	Weak
Cooperative transformation	Weak	Emerging	Emerging	Emerging
Middle-class / asset-building	Emerging	Weak	Emerging	Weak
Land and property-rights reform	Strong	Weak	Weak	Weak
Digital economy & financial inclusion	Weak	Emerging	Emerging	Weak
Decentralised, citizen-led governance	Weak	Weak	Weak	Emerging

Executive Summary

Tanzania's national debt stock stood at TZS 132.74 trillion (USD 50,595.8 million) at the end of June 2026, according to the Bank of Tanzania's (BOT) July 2026 Monthly Economic Review. Of this, external debt accounted for 70.4 percent (TZS 93.41 trillion) and domestic debt accounted for 29.6 percent (TZS 39.33 trillion).

External debt rose only marginally month-on-month (up 0.1 percent from May 2026), but continued a steep multi-year climb — from roughly TZS 46.8 trillion in June 2018 to over TZS 93 trillion in June 2026, more than doubling in eight years. Domestic debt has grown even faster in relative terms, tripling from TZS 13.2 trillion to TZS 39.3 trillion over the same period, with the Bank of Tanzania overdraft facility, commercial banks and pension funds as the dominant domestic creditors.

Multilateral institutions remain Tanzania's single largest external creditor group (59.3 percent of external debt), the US Dollar dominates currency exposure (66.2 percent), and Balance of Payments/budget support plus transport & telecommunication infrastructure together absorb over 44 percent of disbursed external debt. In June 2026 alone, the Government paid an estimated TZS 2.2 trillion in combined domestic and external debt service — a reminder of how much of each month's revenue effort goes toward servicing past borrowing rather than new development spending.

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1. National Debt Overview — June 2026

All figures converted from BOT's USD-denominated debt tables using the end-June 2026 exchange rate of TZS 2,623.5 per USD, and presented in TZS trillions for clarity.

TZS 132.74 Tn

Total national debt stock (Jun-2026)

TZS 93.41 Tn

External debt stock — 70.4% of total

TZS 39.33 Tn

Domestic debt stock — 29.6% of total

+0.1%

External debt growth, m-o-m (May→Jun 2026)

Table 1: Tanzania National Debt Stock Snapshot, June 2026
Item	USD Million	TZS Trillion (approx.)	Share of National Debt
Total national debt stock	50,595.8	132.74	100.0%
— External debt (public + private)	35,606.1	93.41	70.4%
of which: Central government	29,606.0	77.68	83.1% of external
of which: Private sector	6,000.1	15.74	16.9% of external
— Domestic debt (excl. liquidity papers)	~14,989.7	39.33	29.6%
Total (check)	50,595.8	132.74	100.0%

Source: Bank of Tanzania, Monthly Economic Review, July 2026 (Tables 2.7.1, 2.7.5, A10). End-of-period exchange rate: TZS 2,623.5/USD.

Chart 1: Composition of Tanzania's National Debt, June 2026

External vs domestic share of the TZS 132.74 trillion debt stock

Chart unavailable — see Table 1 above for the External (70.4%) vs Domestic (29.6%) debt split.

2. Debt Trend: 2018 – 2026

Tanzania's total national debt has more than doubled over the past eight fiscal years, rising from an estimated TZS 60.0 trillion in June 2018 to TZS 132.74 trillion in June 2026. Domestic debt has grown the fastest in percentage terms — nearly tripling — while external debt has roughly doubled, reflecting continued reliance on both concessional multilateral financing and an expanding domestic securities market.

Chart 2: Tanzania's External, Domestic and Total Debt, June 2018 – June 2026 (TZS Trillion)

Long-run debt accumulation trend, as at end of June each year

Chart unavailable — see Table 2 below for the full year-by-year series.

Note: External debt converted to TZS using the respective end-of-period exchange rate for each year; domestic debt as reported directly by the Ministry of Finance in TZS.

Table 2: Tanzania National Debt Stock by Year, June 2018 – June 2026 (TZS Trillion)
As at June	External Debt (TZS Tn)	Domestic Debt (TZS Tn)	Total Debt (TZS Tn)
2018	46.77	13.23	60.00
2019	50.15	14.86	65.01
2020	52.76	15.59	68.35
2021	58.63	18.93	77.56
2022	64.26	24.04	88.30
2023	75.67	28.93	104.60
2024	75.87	31.94	107.81
2025	85.18	35.50	120.68
2026 (Jun)	93.41	39.33	132.74

Source: BOT Monthly Economic Review, July 2026 (Table A1, Table 2.7.1, Chart 2.7.1). External debt converted using end-of-period exchange rates.

Monthly Movement of Total National Debt (June 2025 – June 2026)

Zooming into the most recent 13 months shows a less linear picture: total debt fluctuated between roughly TZS 123.6 trillion and TZS 134.3 trillion, driven as much by shilling depreciation and cross-currency valuation effects as by new borrowing.

Chart 3: Total National Debt Stock, Monthly, June 2025 – June 2026 (TZS Trillion)

Reflects both new borrowing/repayment and exchange rate valuation effects

Chart unavailable — see Table 3 below for the monthly series.

Table 3: Total National Debt Stock by Month (TZS Trillion)
Month	Total Debt (USD Mn)	Exchange Rate (TZS/USD)	Total Debt (TZS Tn)
Jun-2025	48,396.3	2,604.6	126.05
Jul-2025	49,066.3	2,545.8	124.91
Aug-2025	50,159.0	2,463.3	123.56
Sep-2025	51,050.1	2,442.8	124.71
Oct-2025	51,653.8	2,451.6	126.63
Nov-2025	50,868.2	2,436.8	123.96
Dec-2025	51,013.8	2,447.5	124.86
Jan-2026	51,221.0	2,518.1	128.98
Feb-2026	51,078.3	2,542.5	129.87
Mar-2026	50,803.5	2,577.4	130.94
Apr-2026	51,623.7	2,602.0	134.32
May-2026	50,599.0	2,609.2	132.02
Jun-2026	50,595.8	2,623.5	132.74

Source: BOT Monthly Economic Review, July 2026 (Table A10).

3. External Debt: Creditors, Currency & Use of Funds

External debt (public and private) stood at TZS 93.41 trillion (USD 35,606.1 million) at end June 2026 — a marginal 0.1 percent increase from May 2026. Central government accounted for 83.1 percent of this (TZS 77.68 trillion), while the private sector accounted for 16.9 percent (TZS 15.74 trillion). During the month, external loans disbursed totalled USD 379.8 million (~TZS 1.0 trillion), mainly to the central government, while external debt service payments totalled USD 249.2 million (~TZS 0.65 trillion), of which USD 184.9 million was principal.

3.1 External Debt by Creditor Category

Chart 4: External Debt by Creditor, June 2026

Share of TZS 93.41 trillion external debt stock

Chart unavailable — see Table 4.

Table 4: External Debt Stock by Creditor, June 2026
Creditor	TZS Trillion	Share
Multilateral (World Bank, AfDB, IMF, etc.)	55.42	59.3%
Commercial lenders	32.17	34.4%
Bilateral (government-to-government)	4.01	4.3%
Export credit agencies	1.82	1.9%
Total external debt	93.41	100.0%

Source: BOT Monthly Economic Review, July 2026 (Table 2.7.2).

3.2 External Debt by Currency

Chart 5: External Debt by Currency, June 2026

US Dollar exposure dominates — a key exchange-rate risk factor

Chart unavailable — see Table 5.

Table 5: Disbursed External Debt by Currency Composition
Currency	Jun-25	May-26	Jun-26
United States Dollar	66.0%	65.9%	66.2%
Euro	17.7%	17.5%	17.4%
Chinese Yuan	6.4%	6.6%	6.7%
Other currencies	9.9%	9.9%	9.8%

Source: BOT Monthly Economic Review, July 2026 (Table 2.7.4).

Currency risk note: With 66.2 percent of external debt denominated in US Dollars and the shilling having depreciated 0.08 percent year-on-year to June 2026, continued TZS softening directly raises the shilling-equivalent cost of debt service — a key reason BOT actively manages reserves and intervenes in the interbank foreign exchange market.

3.3 External Debt by Use of Funds

Chart 6: Disbursed Outstanding External Debt by Use of Funds, June 2026

Where borrowed money has actually gone

Chart unavailable — see Table 6.

Table 6: Disbursed Outstanding External Debt by Activity/Use of Funds
Activity	Jun-25	May-26	Jun-26
Balance of Payments & budget support	21.9%	22.3%	22.1%
Transport & telecommunication	21.1%	22.1%	22.0%
Social welfare & education	19.9%	19.5%	19.5%
Energy & mining	13.0%	12.4%	12.8%
Agriculture	5.3%	5.4%	5.3%
Real estate & construction	4.4%	5.1%	5.1%
Finance & insurance	4.1%	4.2%	4.2%
Industries	3.5%	2.8%	2.8%
Tourism	1.7%	1.7%	1.7%
Other	5.1%	4.6%	4.6%

Source: BOT Monthly Economic Review, July 2026 (Table 2.7.3).

4. Domestic Debt: Instruments & Creditors

Government's domestic debt stock rose marginally to TZS 39.33 trillion at end June 2026, from TZS 39.26 trillion in May 2026. In June alone, the Government mobilised TZS 468 billion from the domestic market — TZS 273.3 billion in Treasury bonds and TZS 194.7 billion in Treasury bills — while domestic debt service payments totalled TZS 1.55 trillion (TZS 1.26 trillion principal, TZS 0.29 trillion interest).

4.1 Domestic Debt by Borrowing Instrument

Chart 7: Domestic Debt by Instrument, June 2026

Government bonds dominate the domestic debt portfolio

Chart unavailable — see Table 7.

Table 7: Domestic Debt by Borrowing Instrument, June 2026
Instrument	TZS Trillion	Share
Government bonds	31.42	79.9%
Overdraft (non-securitized)	6.01	15.3%
Treasury bills	1.76	4.5%
Government stocks	0.14	0.3%
Total domestic debt	39.33	100.0%

Source: BOT Monthly Economic Review, July 2026 (Table 2.7.5).

4.2 Domestic Debt by Creditor Category

Chart 8: Domestic Debt by Creditor, June 2026

Commercial banks and pension funds are the Government's main domestic financiers

Chart unavailable — see Table 8.

Table 8: Domestic Debt by Creditor Category, June 2026
Creditor	TZS Trillion	Share
Commercial banks	11.32	28.8%
Pension funds	10.40	26.4%
Bank of Tanzania (incl. overdraft)	7.20	18.3%
Others (institutions, individuals, non-residents)	7.55	19.2%
Insurance companies	2.02	5.1%
BOT's special funds	0.84	2.1%
Total domestic debt	39.33	100.0%

Source: BOT Monthly Economic Review, July 2026 (Table 2.7.6).

4.3 Domestic Debt Growth Trajectory, 2018–2026

Chart 9: Government Domestic Debt Stock, June 2018 – June 2026 (TZS Trillion)

Chart unavailable — see Table 2 above for the domestic debt column.

5. Debt Service & New Borrowing (June 2026 Snapshot)

Table 9: Debt Service and New Borrowing Flows, June 2026
Flow	External (TZS Tn)	Domestic (TZS Tn)	Combined (TZS Tn)
New borrowing / disbursements	~1.00	0.468	~1.47
Principal repayments	~0.49	1.26	~1.75
Interest payments	~0.17	0.29	~0.46
Total debt service (principal + interest)	~0.65	1.55	~2.20

Source: BOT Monthly Economic Review, July 2026 (narrative figures, Section 2.7). External figures converted from USD at TZS 2,623.5/USD.

In effect, for every shilling of new external borrowing disbursed in June 2026, the Government paid out roughly the same amount servicing existing external debt — while domestic debt service alone (TZS 1.55 trillion) was more than three times the value of new domestic securities issued (TZS 468 billion) that month. This "rolling debt" dynamic is a key reason the domestic debt stock has grown steadily even without large net new financing every month.

6. Macroeconomic Context Behind the Debt Numbers

Debt does not move in isolation — it sits alongside growth, inflation and monetary policy. Key context from BOT's July 2026 review:

Growth: Real GDP grew 6.0 percent in Q1 2026 (up from 4.3 percent a year earlier), with the Bank projecting 5.9 percent growth in Q2 2026 — growth that partly reflects continued public investment financed by borrowing.
Inflation: Headline inflation eased slightly to 4.0 percent in June 2026 (from 4.2 percent in May), remaining within the national 3–5 percent target band, though core inflation rose to 3.7 percent — its highest contribution to headline inflation in two years.
Monetary policy tightening: Following signs of broadening inflationary pressure, the Monetary Policy Committee raised the Central Bank Rate (CBR) from 5.75 percent to 6.25 percent for Q3 2026 (effective 2 July 2026) — a move that also raises the cost of new domestic government borrowing going forward.
Reserves buffer: Gross official foreign exchange reserves stood at USD 5,673.5 million, covering 4.4 months of projected imports — above the 4-month national benchmark, providing some cushion for external debt service.
Exchange rate: The shilling traded at an average of TZS 2,633.73/USD in June 2026, depreciating 0.08 percent year-on-year — modest, but a continued gradual drag on the TZS-equivalent cost of Tanzania's dollar-heavy external debt.

Chart 10: Central Bank Rate vs Headline Inflation, Recent Trend

Monetary tightening raises the cost of future domestic borrowing

Chart unavailable — CBR was held at 5.75% through Q2 2026, then raised to 6.25% for Q3 2026 (effective 2 July 2026), while headline inflation moved from 3.3% (Jun-25) to 4.0% (Jun-26).

7. Risks & Outlook

Currency concentration risk: Two-thirds of external debt is US-Dollar denominated. Any renewed shilling depreciation — plausible given continued global energy price volatility from the Middle East conflict — directly increases the shilling cost of debt service.

Rising interest burden domestically: With the CBR raised to 6.25 percent for Q3 2026, new Treasury bond and bill issuances are likely to carry higher coupons, raising the Government's future domestic interest bill on top of the TZS 39.33 trillion already outstanding.

Reserve buffer intact: At 4.4 months of import cover, reserves remain above the national and regional benchmarks, providing a cushion against short-term external shocks to debt service capacity.

Multilateral concentration cuts both ways: With 59.3 percent of external debt held by multilateral institutions (typically concessional, longer-tenor financing), Tanzania's external debt profile is comparatively lower-risk than one dominated by short-term commercial borrowing — though commercial debt (34.4 percent) is still substantial and growing.

For a broader assessment of how debt-financed public investment interacts with Tanzania's structural growth constraints and its Dira 2050 ambitions, see TICGL's related analysis on the policy gaps keeping USD 1 trillion out of reach by 2050 and whether Tanzania's economy is truly growing.

Muhtasari kwa Kiswahili

Muhtasari wa uchambuzi wa deni la taifa la Tanzania, kutoka Taarifa ya Kila Mwezi ya Uchumi ya BOT, Julai 2026

Deni la taifa: Hadi kufikia Juni 2026, deni la taifa la Tanzania lilifikia Shilingi trilioni 132.74 (dola za Marekani milioni 50,595.8). Kati ya hizo, asilimia 70.4 ni deni la nje (Shilingi trilioni 93.41), na asilimia 29.6 ni deni la ndani (Shilingi trilioni 39.33).

Deni la nje: Deni la nje liliongezeka kwa asilimia 0.1 tu kutoka Mei hadi Juni 2026. Serikali kuu inamiliki asilimia 83.1 ya deni hilo, huku sekta binafsi ikimiliki asilimia 16.9. Wakopeshaji wakubwa ni taasisi za kimataifa (multilateral) kwa asilimia 59.3, wakifuatiwa na wakopeshaji wa kibiashara kwa asilimia 34.4.

Sarafu: Dola ya Marekani inatawala mfumo wa deni la nje kwa asilimia 66.2, ikifuatiwa na Euro (asilimia 17.4) na Yuan ya China (asilimia 6.7) — hali inayoongeza hatari endapo thamani ya shilingi itashuka zaidi.

Deni la ndani: Deni la ndani limefikia Shilingi trilioni 39.33, likiongozwa na hatifungani za Serikali (asilimia 79.9). Wadai wakuu wa ndani ni benki za biashara (asilimia 28.8), mifuko ya pensheni (asilimia 26.4), na Benki Kuu ya Tanzania kupitia akaunti ya overdraft (asilimia 18.3).

Malipo ya deni: Katika mwezi wa Juni 2026 pekee, Serikali ililipa jumla ya takriban Shilingi trilioni 2.2 kama malipo ya deni la ndani na nje — kiasi kikubwa zaidi ya thamani ya mikopo mipya iliyochukuliwa mwezi huo huo.

Sera ya fedha: Kutokana na dalili za mfumuko wa bei kuenea (core inflation kupanda hadi asilimia 3.7), Benki Kuu iliongeza Riba ya Benki Kuu (CBR) kutoka asilimia 5.75 hadi asilimia 6.25 kwa robo ya tatu ya 2026 — hatua itakayoongeza gharama za mikopo mipya ya ndani.

Hitimisho: Ingawa akiba ya fedha za kigeni (miezi 4.4 ya uagizaji bidhaa) inatoa kinga fulani, ukuaji endelevu wa deni — hasa deni la ndani — unahitaji tathmini makini ya uwiano kati ya uwekezaji wa umma na uwezo wa kulipa deni kwa muda mrefu.

Frequently Asked Questions

What is Tanzania's total national debt as of June 2026?

Tanzania's national debt stock stood at TZS 132.74 trillion (USD 50,595.8 million) at the end of June 2026 — 70.4 percent external and 29.6 percent domestic.

How much of Tanzania's debt is external versus domestic?

External debt was TZS 93.41 trillion (USD 35,606.1 million), while domestic debt was TZS 39.33 trillion, as at end June 2026.

Who are Tanzania's largest external creditors?

Multilateral institutions hold 59.3 percent of external debt (about TZS 55.42 trillion), followed by commercial lenders at 34.4 percent, bilateral creditors at 4.3 percent, and export credit agencies at 1.9 percent.

Which currency dominates Tanzania's external debt?

The US Dollar accounts for 66.2 percent of external debt, followed by the Euro (17.4 percent) and the Chinese Yuan (6.7 percent).

Who holds Tanzania's domestic debt?

Commercial banks hold 28.8 percent, pension funds 26.4 percent, the Bank of Tanzania (mainly via the overdraft facility) 18.3 percent, other holders 19.2 percent, and insurance companies 5.1 percent.

How much did the Government spend on debt service in June 2026?

Roughly TZS 2.2 trillion combined — about TZS 1.55 trillion on domestic debt and about TZS 0.65 trillion on external debt.

Primary source: Bank of Tanzania, "Monthly Economic Review," July 2026. Tables 2.7.1–2.7.6, A1, A10, Chart 2.7.1, and related narrative sections on Government Budgetary Operations, Monetary Policy and External Sector Performance. USD figures converted to TZS using BOT's reported end-of-period exchange rates for each respective date. This analysis is produced by TICGL/TERI for informational and research purposes and does not constitute investment advice.

Executive Summary

Tanzania's economy maintained strong momentum through mid-2026, even as global conditions stayed volatile. Real GDP grew 6.0 percent in Q1 2026, up sharply from 4.3 percent a year earlier, driven by agriculture, financial and insurance services, and transport and storage. The Bank of Tanzania (BOT) projects 5.9 percent growth in Q2 2026, supported by expanding private sector credit, reliable power supply, strong mineral production and continued infrastructure investment.

Headline inflation eased marginally to 4.0 percent in June 2026 from 4.2 percent in May, staying within the national 3–5 percent target band — but core inflation climbed to 3.7 percent, its highest contribution to headline inflation in two years, prompting the Monetary Policy Committee to raise the Central Bank Rate from 5.75 percent to 6.25 percent for Q3 2026. Private sector credit growth accelerated to 28.1 percent year-on-year, the fastest pace in years, while the current account deficit widened to USD 2,303.9 million as import growth outpaced exports. Foreign reserves remained adequate at 4.4 months of import cover. In Zanzibar, inflation rose to 6.0 percent on food and transport costs, even as tourism-driven export earnings grew strongly.

📊

Related TICGL Deep-Dive

What's Next for Tanzania's Economy? The Policy Gaps Keeping USD 1 Trillion Out of Reach by 2050

Strong quarterly growth is encouraging, but TICGL's flagship analysis asks the harder question: are the structural and policy conditions in place for Tanzania to sustain this trajectory all the way to a USD 1 trillion economy by 2050?

Read the Full Analysis →

1. Global Economic Conditions

The global economy closed the first half of 2026 balancing two opposing forces: an energy-price shock from the Middle East conflict, and rapid AI-driven investment. The IMF's July 2026 World Economic Outlook Update projects global growth of 3.0 percent in 2026, strengthening to 3.4 percent in 2027 — broadly unchanged from the April 2026 forecast. The OECD's July 2026 Outlook is more cautious, projecting 2.8 percent in 2026, rising to 3.1 percent in 2027. Sub-Saharan Africa growth is projected to moderate to 4.3 percent in 2026 before recovering to 4.4 percent in 2027.

Global commodity prices corrected sharply in June 2026 as risk premiums eased following a ceasefire near the Strait of Hormuz. Crude oil (average of Brent, Dubai, WTI) fell to USD 81.70/barrel from USD 100.43 in May; Brent fell 20.6 percent to USD 85.40/barrel. Gold averaged USD 4,228/troy ounce, down from USD 4,587.21, as safe-haven demand eased. Despite the correction, energy prices remained about 25 percent above pre-conflict levels.

Chart 1: Global Commodity Price Index Change, June 2026 (m-o-m)

Sharp correction across energy, fertilizers and precious metals

Chart unavailable — see Table 1 below.

Table 1: World Commodity Price Index, % Change (June 2026, m-o-m)
Commodity/Index	% Change (m-o-m)
Fertilizers	-21.8%
Energy	-17.7%
o/w Brent crude oil	-20.6%
o/w Natural gas (US)	+7.3%
Precious metals	-9.2%
Non-energy	-3.2%
Metals and minerals	-2.4%
Food	-2.6%
Agriculture	-1.7%
Raw materials	-1.2%
Beverages	+1.1%

Source: World Bank Commodity Price (Pink Sheet), via BOT Monthly Economic Review, July 2026 (Table 1.1).

Monetary policy abroad: In June 2026, the European Central Bank and Bank of Japan each raised policy rates by 25 basis points (ECB deposit rate to 2.25%, BoJ to 1.00%), while the US Federal Reserve and Bank of England held rates at 3.50–3.75% and 3.75% respectively, both signalling their next move was more likely a hike than a cut. The IMF revised its 2026 global headline inflation forecast upward to 4.7 percent (from 4.1% in 2025), implying disinflation momentum since 2024 has stalled.

2. Domestic Output & GDP Growth

6.0%

Real GDP growth, Q1 2026 (vs 4.3% Q1 2025)

5.9%

BOT projected growth, Q2 2026

Agriculture

Leading growth driver, alongside finance & transport

2027 AFCON

Infrastructure prep supporting near-term activity

Chart 2: Tanzania Quarterly Real GDP Growth, 2022 – 2026 (at 2019 prices)

Percent, year-on-year

Chart unavailable — see Table 2 below.

Table 2: Quarterly Real GDP Growth, 2022–2026 (%)
Year	Q1	Q2	Q3	Q4
2022	2.5	4.9	6.6	3.9
2023	4.0	3.4	6.2	7.2
2024	7.5	6.8	4.6	3.9
2025	4.3	7.5	6.3	5.5
2026	6.0	5.9 (proj.)	—	—

Source: National Bureau of Statistics and Bank of Tanzania computations (Chart 2.1a). Q2 2026 is BOT's projection based on high-frequency indicators.

Growth in Q1 2026 was driven primarily by agriculture, financial and insurance services, and transport and storage activities. BOT expects Q2 2026 momentum to hold up on the back of continued private sector credit expansion, reliable power supply, strong mineral production, sustained tourism resilience, ongoing strategic infrastructure investment, and preparations for the 2027 Africa Cup of Nations.

3. Inflation

4.0%

Headline inflation, June 2026 (May: 4.2%)

3.7%

Core inflation, June 2026 (highest in 2 years)

4.1%

Food inflation, June 2026 (May: 5.6%)

6.3%

Energy, fuel & utilities inflation, June 2026

Headline inflation remained within Tanzania's national 3–5 percent target range and regional (SADC/EAC) convergence benchmarks throughout the period. The easing from May to June 2026 was mainly due to moderating food prices on the back of the ongoing harvest, which partly offset a continued rise in core inflation.

Chart 3: Headline, Core and Energy Inflation, June 2025 – June 2026

Twelve-month percentage change

Chart unavailable — see Table 3 below.

Table 3: Headline, Core and Energy/Fuel/Utilities Inflation, Monthly (%)
Month	Headline	Core	Energy, Fuel & Utilities
Jun-2025	3.3	1.9	2.1
Jul-2025	3.3	1.9	1.0
Aug-2025	3.4	2.0	2.6
Sep-2025	3.4	2.2	3.7
Oct-2025	3.5	2.1	4.0
Nov-2025	3.4	2.3	3.8
Dec-2025	3.6	2.3	3.8
Jan-2026	3.3	2.2	5.2
Feb-2026	3.2	2.1	2.8
Mar-2026	3.2	2.2	2.1
Apr-2026	4.0	3.1	5.3
May-2026	4.2	3.4	5.0
Jun-2026	4.0	3.7	6.3

Source: National Bureau of Statistics and Bank of Tanzania computations (Tables A9(i) and A9(ii)).

Food security note: Food stocks held by the National Food Reserve Agency stood at 480,219 tonnes in June 2026, after releasing 16,812.3 tonnes of maize and paddy to traders — supporting the moderation in food inflation to 4.1 percent from 7.3 percent a year earlier.

4. Monetary Policy & Money Supply

In June 2026, BOT continued implementing the MPC's April 2026 decisions, holding the CBR at 5.75 percent and narrowing the interest rate corridor to ±150 basis points (4.25–7.25%) to strengthen policy transmission. The 7-day interbank cash market rate averaged 5.98 percent, close to the CBR, reflecting effective liquidity management. However, with core inflation rising from 2.2 percent in March to 3.7 percent in June 2026 — a sign of broadening second-round effects from the global supply shock — the MPC raised the CBR to 6.25 percent for Q3 2026 at its 2 July 2026 meeting.

Chart 4: Extended Broad Money (M3) and Private Sector Credit Stock, June 2025 – June 2026

TZS Trillion

Chart unavailable — see Table 4 below.

Table 4: Money Supply (M3) and Private Sector Credit Stock, Monthly (TZS Trillion)
Month	Extended Broad Money (M3)	Credit to Private Sector
Jun-2025	55.48	40.55
Jul-2025	56.29	40.97
Aug-2025	57.46	41.53
Sep-2025	57.85	42.00
Oct-2025	59.79	42.39
Nov-2025	60.86	43.39
Dec-2025	60.99	44.60
Jan-2026	62.11	45.17
Feb-2026	63.07	46.05
Mar-2026	64.25	47.22
Apr-2026	65.09	47.92
May-2026	66.80	49.03
Jun-2026	69.62	51.92

Source: Bank of Tanzania and banks (Table A3). M3 growth reached 25.5% y-o-y in June 2026 (25.2% in May); private sector credit growth accelerated to 28.1% y-o-y (23.2% in May).

Chart 5: Annual Credit Growth by Economic Activity, June 2026

Trade posted the strongest annual credit growth, followed by transport & agriculture

Chart unavailable — see Table 5 below.

Table 5: Annual Growth of Credit to Select Economic Activities (%)
Sector	Jun-25	Dec-25	Jun-26
Trade	21.3	49.7	59.5
Transport and communication	25.7	29.4	46.4
Agriculture	30.2	28.9	39.9
Personal	13.7	17.7	34.4
Building and construction	25.7	25.6	30.1
Mining and quarrying	20.8	91.1	21.8
Hotels and restaurants	22.5	2.5	8.3
Manufacturing	2.5	-8.2	0.9

Source: Banks and Bank of Tanzania (Table 2.3.2). Personal loans (largely supporting MSMEs) continue to hold the largest overall share of the credit portfolio, followed by trade and agriculture.

5. Interest Rates & Financial Markets

Banks' interest rates stayed relatively stable in June 2026. The overall lending rate eased to 15.20 percent from 15.32 percent in May, while the overall time deposit rate rose to 8.60 percent from 8.43 percent. The spread between one-year lending and deposit rates widened to 5.66 percentage points from 5.22 points.

Chart 6: Overall Lending Rate vs Overall Time Deposit Rate, June 2025 – June 2026

Percent per annum

Chart unavailable — see Table 6 below.

Table 6: Overall Lending and Time Deposit Rates, Monthly (%)
Month	Overall Lending Rate	Overall Time Deposit Rate
Jun-2025	15.23	8.74
Jul-2025	15.16	8.83
Aug-2025	15.07	8.61
Sep-2025	15.18	8.50
Oct-2025	15.19	8.36
Nov-2025	15.27	8.54
Dec-2025	15.24	8.36
Jan-2026	15.10	8.33
Feb-2026	15.11	8.32
Mar-2026	15.11	8.33
Apr-2026	15.33	8.54
May-2026	15.32	8.43
Jun-2026	15.20	8.60

Source: Banks and Bank of Tanzania computations (Table A4).

Chart 7: Treasury Bond Yield Curve, June 2026

Yield to maturity by tenor

Chart unavailable — see Table 7.

Table 7: Treasury Securities Auction Results, June 2026
Instrument	Detail
T-bill tender size	TZS 552.1 billion
T-bill bids received	TZS 1,295.9 billion
T-bill amount accepted	TZS 597.1 billion
Overall T-bill weighted avg. yield	4.83% (from 4.74%)
T-bond tender size (10 & 25-yr)	TZS 387.6 billion
T-bond bids received	TZS 1,539.6 billion
T-bond amount accepted	TZS 269.8 billion
10-year yield	10.39% (from 9.40%)
25-year yield	11.89% (from 11.99%)

Source: Bank of Tanzania (Section 2.5, Table A4). Both auctions were oversubscribed, reflecting strong investor appetite for government securities.

Money and forex markets: Interbank cash market turnover rose to TZS 2,508.7 billion in June 2026 (from TZS 1,732.7 billion in May), with the overall interbank rate easing to 6.0 percent. In the interbank foreign exchange market, turnover rose to USD 193.3 million (from USD 119.3 million), with BOT making a net sale of USD 28.5 million to smooth volatility. The shilling averaged TZS 2,633.73/USD in June 2026, depreciating just 0.08 percent year-on-year.

6. Government Budgetary Operations (Mainland)

Latest available actuals: May 2026 (cheques issued basis), against monthly targets under the 2025/26 budget.

Chart 8: Central Government Revenue vs Expenditure, May 2026

Actual vs monthly target, TZS Trillion

Chart unavailable — see Table 8 below.

Table 8: Central Government Budgetary Operations, May 2026 (TZS Trillion)
Item	Target	Actual	Performance
Total government revenue	3.242	3.259	100.5% of target
Central government revenue	3.110	3.152	101.4% of target
Tax revenue	2.615	2.750	105.2% of target
of which: Income tax	0.719	0.955	132.9% of target
of which: Taxes on imports	0.964	1.123	above target
Non-tax revenue	0.495	0.402	below target
Total expenditure	4.653	4.018	below target
Recurrent expenditure	—	2.881	—
Development expenditure	—	1.138	—
Overall balance (deficit)	-1.334	-0.418	narrower than targeted

Source: Ministry of Finance and Bank of Tanzania computations (Table A2). Figures for 2026 are provisional.

Tax revenue performance was strong, exceeding target by 5.2 percent, driven mainly by income tax collections which beat target by 32.9 percent — reflecting improved tax administration and compliance. Non-tax revenue underperformed its target. On expenditure, the Government kept spending below target, financing the resulting narrower deficit through a mix of domestic borrowing (TZS 0.376 trillion) and foreign financing (TZS 0.042 trillion).

7. External Sector Performance

USD 19,923.6M

Exports of goods & services, FY to Jun-26 (+17.2%)

USD 20,815.7M

Imports of goods & services, FY to Jun-26 (+18.1%)

USD 2,303.9M

Current account deficit, FY to Jun-26

4.4 months

Import cover from reserves (benchmark: 4 months)

Chart 9: Exports vs Imports of Goods & Services, Year Ending June (USD Million)

Chart unavailable — see Table 9 below.

Table 9: External Trade & Current Account, Year Ending June (USD Million)
Year Ending June	Exports (Goods & Services)	Imports (Goods & Services)	Current Account Balance
2024	14,410.9	16,144.9	-2,823.1
2025	17,001.3	17,629.8	-2,153.4
2026 (provisional)	19,923.6	20,815.7	-2,303.9

Source: Tanzania Revenue Authority, banks and Bank of Tanzania computations (Table 2.8.1).

Export growth was led by gold (the leading export, benefiting from elevated international prices), manufactured goods (iron and steel, glassware, textiles), and traditional crops (tobacco, cashew nuts, coffee). Import growth was driven by industrial supplies, refined petroleum products, machinery and capital goods — reflecting strong domestic demand and continued efforts to expand productive capacity.

Chart 10: Gross Official Foreign Exchange Reserves, 2018 – 2026 (USD Million)

Chart unavailable — see Table 10 below.

Table 10: Gross Official Reserves, Year-End (USD Million)
Year	Gross Reserves	Months of Import Cover
2018	5,044.6	4.9
2019	5,567.6	6.4
2020	4,767.7	5.6
2021	6,386.0	6.6
2022	5,177.2	4.7
2023	5,450.1	4.5
2024	5,546.9	4.5
2025	6,329.0	4.9
2026 (Jun)	5,673.5	4.4

Source: Bank of Tanzania (Table A1, Chart 2.8.1). Reserves supported by sustained gold export earnings and the domestic gold purchase programme.

8. Zanzibar's Economy

6.0%

Zanzibar headline inflation, June 2026

10.5%

Food inflation, June 2026

USD 1,023.2M

Current account surplus, FY to Jun-26 (+29.1%)

949,278

Tourist arrivals, FY to Jun-26 (+18.9%)

Chart 11: Zanzibar Inflation, June 2025 vs June 2026

Chart unavailable — see Table 11.

Table 11: Zanzibar Inflation, Annual Change (%)
Measure	Jun-25	May-26	Jun-26
Headline inflation	4.1	5.5	6.0
Food inflation	4.4	9.9	10.5
Non-food inflation	3.9	2.1	2.5

Source: Office of the Chief Government Statistician (Table 3.1.1).

Table 12: Zanzibar Government Budget, June 2026 (TZS Billion)
Item	Amount
Domestic revenue and grants	204.4 (77.5% of target)
Tax collections	160.1 (72.9% of target)
Non-tax revenue	17.0 (78.2% of target)
Total government expenditure	423.6
of which: Development expenditure	314.9
Overall fiscal deficit (financed by domestic borrowing)	219.2

Source: Ministry of Finance and Planning, Zanzibar (Section 3.2).

Zanzibar's external position strengthened notably, with the current account surplus growing 29.1 percent to USD 1,023.2 million, mainly on higher service receipts from tourism-related activities. Exports of goods and services grew 26.7 percent to USD 1,796.6 million, aided by an 18.9 percent rise in tourist arrivals to 949,278.

9. Outlook

Growth momentum intact: With BOT projecting 5.9 percent growth for Q2 2026 and strong credit expansion feeding private investment, Tanzania's near-term growth outlook remains solid — provided global energy prices don't spike again.

Inflation vigilance required: Core inflation's rise to 3.7 percent suggests second-round effects from the Middle East-driven supply shock are broadening. The CBR hike to 6.25 percent signals BOT is willing to act pre-emptively, which could gradually raise borrowing costs across the economy.

Widening trade gap: Imports are growing faster than exports (18.1% vs 17.2%), keeping the current account in deficit. Continued reliance on gold as the dominant export earner leaves the external position exposed to global gold price swings.

For a structural view of what stands between Tanzania and its Dira 2050 ambitions, see TICGL's related analyses on the policy gaps keeping USD 1 trillion out of reach, whether Tanzania's economy is truly growing, and why growth has not been sufficiently inclusive.

Muhtasari kwa Kiswahili

Muhtasari wa Taarifa ya Uchumi ya Tanzania, kutoka Taarifa ya Kila Mwezi ya BOT, Julai 2026

Ukuaji wa Uchumi: Pato la Taifa (GDP) liliongezeka kwa asilimia 6.0 katika robo ya kwanza ya 2026, kutoka asilimia 4.3 mwaka jana, likichagizwa na kilimo, huduma za fedha na bima, pamoja na usafirishaji na uhifadhi. BOT inatarajia ukuaji wa asilimia 5.9 katika robo ya pili ya 2026.

Mfumuko wa bei: Mfumuko wa bei ulipungua kidogo hadi asilimia 4.0 mwezi Juni 2026 kutoka asilimia 4.2 mwezi Mei, ukibaki ndani ya wigo wa lengo la taifa la asilimia 3–5. Hata hivyo, "core inflation" iliongezeka hadi asilimia 3.7 — kiwango cha juu zaidi katika miaka miwili.

Sera ya fedha: Kutokana na dalili za mfumuko wa bei kuenea, Benki Kuu iliongeza Riba ya Benki Kuu (CBR) kutoka asilimia 5.75 hadi asilimia 6.25 kwa robo ya tatu ya 2026, kuanzia tarehe 2 Julai 2026.

Mikopo na fedha: Ukuaji wa mikopo kwa sekta binafsi uliongezeka hadi asilimia 28.1 — kasi ya juu zaidi katika miaka ya hivi karibuni — ukichagizwa na biashara, usafirishaji, na kilimo.

Sekta ya nje: Nakisi ya urari wa malipo (current account deficit) iliongezeka hadi dola za Marekani milioni 2,303.9, kwani uagizaji wa bidhaa ulikua kwa kasi zaidi (asilimia 18.1) kuliko usafirishaji (asilimia 17.2). Akiba ya fedha za kigeni ilikuwa dola milioni 5,673.5, sawa na miezi 4.4 ya uagizaji bidhaa.

Zanzibar: Mfumuko wa bei Zanzibar uliongezeka hadi asilimia 6.0 mwezi Juni 2026, ukichagizwa na bei za vyakula na usafiri. Ziada ya urari wa malipo iliongezeka kwa asilimia 29.1 hadi dola milioni 1,023.2, ikichagizwa na ongezeko la watalii kwa asilimia 18.9.

Hitimisho: Uchumi wa Tanzania unaendelea kukua kwa kasi nzuri, lakini changamoto za mfumuko wa bei na nakisi ya biashara ya nje zinahitaji ufuatiliaji makini katika miezi ijayo.

Frequently Asked Questions

How fast is Tanzania's economy growing in 2026?

Real GDP grew 6.0 percent in Q1 2026, up from 4.3 percent a year earlier, with BOT projecting 5.9 percent growth for Q2 2026.

What is Tanzania's inflation rate in June 2026?

Headline inflation was 4.0 percent in June 2026, within the national 3–5 percent target band, though core inflation rose to 3.7 percent.

What is Tanzania's Central Bank Rate in 2026?

The CBR was held at 5.75 percent through Q2 2026, then raised to 6.25 percent for Q3 2026 effective 2 July 2026.

What is Tanzania's current account deficit?

The current account deficit widened to USD 2,303.9 million in the year ending June 2026, from USD 2,153.4 million a year earlier.

How much are Tanzania's foreign exchange reserves?

USD 5,673.5 million at end June 2026, covering 4.4 months of projected imports.

How is Zanzibar's economy performing in 2026?

Zanzibar's headline inflation rose to 6.0 percent while its current account surplus grew 29.1 percent to USD 1,023.2 million, driven by tourism.

Primary source: Bank of Tanzania, "Monthly Economic Review," July 2026 — Sections 1.0–3.3 and Statistical Tables A1–A10. This analysis is produced by TICGL/TERI for informational and research purposes and does not constitute investment advice.

Executive Summary

Zanzibar's economy showed a mixed but broadly positive picture in June 2026. Headline inflation rose to 6.0 percent, from 4.1 percent a year earlier, driven by higher food prices and rising transport costs linked to fuel prices — food inflation alone reached 10.5 percent. On the fiscal side, domestic revenue and grants reached TZS 204.4 billion against a monthly target, while government spending of TZS 423.6 billion produced an overall fiscal deficit of TZS 219.2 billion, financed through domestic borrowing.

The external sector was the standout performer: Zanzibar's current account surplus grew 29.1 percent to USD 1,023.2 million in the year ending June 2026, driven overwhelmingly by tourism. Tourist arrivals rose 18.9 percent to 949,278, pushing service export receipts up 24.7 percent and cementing tourism as the backbone of Zanzibar's external earnings. Exports of goods and services grew 26.7 percent to USD 1,796.6 million, while imports grew 23.1 percent to USD 785.7 million.

🏝️

Related TICGL Deep-Dive

What's Next for Tanzania's Economy? The Policy Gaps Keeping USD 1 Trillion Out of Reach by 2050

Zanzibar's tourism-led growth is a bright spot in the Union economy — but TICGL's flagship analysis examines the structural and policy gaps that stand between the whole of Tanzania and a USD 1 trillion economy by 2050.

Read the Full Analysis →

1. Inflation Developments

6.0%

Headline inflation, June 2026 (May: 5.5%)

10.5%

Food inflation, June 2026

2.5%

Non-food inflation, June 2026

1.0%

Month-on-month headline (Jun-26), up from 0.5% a year ago

Zanzibar's headline inflation climbed to 6.0 percent in June 2026, from 4.1 percent a year earlier, largely on higher food prices and rising transport costs linked to elevated fuel prices. By contrast, non-food inflation actually eased to 2.5 percent (from 3.9 percent a year earlier), with moderation in clothing/footwear, personal care and miscellaneous goods and services.

Chart 1: Zanzibar Headline, Food and Non-Food Inflation

Twelve-month percentage change

Chart unavailable — see Table 1 below.

Table 1: Zanzibar Inflation, Annual Change (%)
Measure	Jun-25	May-26	Jun-26
Headline inflation	4.1	5.5	6.0
Food	4.4	9.9	10.5
Non-food	3.9	2.1	2.5

Source: Office of the Chief Government Statistician (Table 3.1.1).

1.1 Inflation by Category, June 2026

Chart 2: Zanzibar CPI by Category, June 2026

Twelve-month percentage change, by COICOP group

Chart unavailable — see Table 2 below.

Table 2: Zanzibar CPI by Main Group, Annual Change (%)
Category	Weight (%)	Jun-25	May-26	Jun-26
Food and non-alcoholic beverages	41.9	5.0	9.7	10.3
Restaurants and accommodation services	1.4	0.6	7.4	7.4
Alcoholic beverages, tobacco and narcotics	0.2	-2.2	4.3	5.5
Transport	9.1	2.4	5.1	5.3
Furnishings, household equipment & maintenance	4.8	3.8	2.4	3.7
Personal care, social protection & misc.	1.7	4.8	0.8	0.8
Health	1.3	1.5	0.6	0.7
Housing, water, electricity, gas & other fuels	25.8	3.6	1.2	1.8
Clothing and footwear	6.3	5.0	1.6	1.4
Education	1.6	2.1	0.3	2.0
Recreation, sport and culture	1.1	5.1	2.6	2.0
Information and communication	4.2	2.8	0.1	-0.6
Insurance and financial services	0.5	0.0	0.0	0.0
All items (headline)	100.0	4.1	5.5	6.0

Source: Office of the Chief Government Statistician (Table 3.1.1). Base: July 2022 = 100.

Watch food and transport: Food (41.9% of the CPI basket) and restaurants/accommodation both accelerated sharply in the year to June 2026, while transport inflation stayed elevated on fuel costs — together these are the main drivers pulling Zanzibar's headline inflation above the 4-percent mark.

2. Government Budgetary Operations

In June 2026, Zanzibar's domestic revenue and grants reached TZS 204.4 billion, equivalent to 77.5 percent of the monthly target. Domestic revenue accounted for the largest share (86.6 percent), with the balance made up of grants. Tax collections reached TZS 160.1 billion (72.9 percent of target), with satisfactory performance in VAT and local excise duties, while non-tax revenue reached TZS 17 billion (78.2 percent of target).

Chart 3: Zanzibar Government Resources, June (TZS Billion)

2025 Actual vs 2026 Estimate vs 2026 Actual

Chart unavailable — see Table 3.

Table 3: Zanzibar Government Resources, June 2026 (TZS Billion)
Item	2025 Actual	2026 Estimate	2026 Actual
Tax on imports	30.4	31.5	26.4
VAT & excise duties (local)	43.5	46.9	47.5
Income tax	49.0	61.3	50.2
Other taxes	39.2	80.0	36.0
Non-tax revenue	20.5	21.8	17.0
Grants	2.3	22.4	27.3
Total resources	184.9	263.9	204.4

Source: Ministry of Finance and Planning, Zanzibar (Chart 3.2.1). "Other taxes" include hotel/restaurant levies, tour operator levy, revenue stamps, airport/seaport charges, road development fund, and petroleum levy.

Chart 4: Zanzibar Government Expenditure, June (TZS Billion)

2025 Actual vs 2026 Estimate vs 2026 Actual

Chart unavailable — see Table 4.

Table 4: Zanzibar Government Expenditure, June 2026 (TZS Billion)
Item	2025 Actual	2026 Estimate	2026 Actual
Wages and salaries	68.2	67.5	67.6
Other recurrent expenditure	92.6	55.1	41.1
Development expenditure	270.8	369.5	314.9
Total expenditure	431.6	492.1	423.6

Source: Ministry of Finance and Planning, Zanzibar (Chart 3.2.2). "Other recurrent expenditure" includes transfers, domestic debt interest, consolidated fund service and other charges.

Fiscal outcome: With expenditure of TZS 423.6 billion against resources of TZS 204.4 billion, Zanzibar recorded an overall fiscal deficit of TZS 219.2 billion in June 2026, financed entirely through domestic borrowing. Development spending (TZS 314.9 billion) made up 74 percent of total expenditure, underscoring continued heavy public investment.

3. External Sector Performance

USD 1,796.6M

Exports of goods & services, FY to Jun-26 (+26.7%)

USD 785.7M

Imports of goods & services, FY to Jun-26 (+23.1%)

USD 1,023.2M

Current account surplus, FY to Jun-26 (+29.1%)

949,278

Tourist arrivals, FY to Jun-26 (+18.9%)

Zanzibar's current account surplus grew 29.1 percent to USD 1,023.2 million in the year ending June 2026, from USD 792.4 million a year earlier — driven overwhelmingly by higher service receipts from tourism-related activities. The services account surplus reached USD 1,597.1 million (+24.5%), dwarfing the goods account deficit of USD 586.2 million.

Chart 5: Zanzibar Current Account Components, Year Ending June (USD Million)

2025 vs 2026 (provisional)

Chart unavailable — see Table 5.

Table 5: Zanzibar Current Account, Year Ending June (USD Million)
Item	2025	2026 (provisional)	% Change
Goods account (net)	-503.9	-586.2	16.3%
Services account (net)	1,283.3	1,597.1	24.5%
Goods & services (net)	779.4	1,010.9	29.7%
Primary income account (net)	11.6	10.3	-11.3%
Secondary income (net)	1.4	2.0	44.6%
Current account balance	792.4	1,023.2	29.1%

Source: Tanzania Revenue Authority, banks, and Bank of Tanzania computations (Table 3.3.1).

Chart 6: Zanzibar Exports vs Imports of Goods & Services, Year Ending June (USD Million)

Chart unavailable — see Table 5 above (Goods & Services rows) and Table 6 below.

Chart 7: Tourist Arrivals to Zanzibar, Year Ending June

Central driver of Zanzibar's services export growth

Chart unavailable — tourist arrivals grew 18.9% from approximately 798,384 (FY2025 est.) to 949,278 (FY2026).

3.1 Export Composition, Year Ending June 2026

Clove exports — Zanzibar's flagship traditional export — surged in value, more than doubling from a low base as unit prices rose 33.8 percent to USD 6,335.9 per tonne. Non-traditional exports (seaweed, manufactured goods, fish products) softened somewhat in value even as export volumes shifted, while "other exports" grew strongly.

Chart 8: Zanzibar Export Composition, FY 2026 (USD Million)

Chart unavailable — see Table 6.

Table 6: Zanzibar Exports of Goods, Year Ending June (USD Million)
Item	2025	2026 (provisional)	% Change
Clove (traditional export)	3.45	44.58	+1,192%
Seaweeds	3.22	1.74	-45.9%
Manufactured goods	15.39	10.76	-30.1%
Fish and fish products	1.18	0.89	-24.0%
Other exports	10.05	12.49	+24.2%
Grand total (goods exports)	33.29	70.46	+111.6%

Source: Tanzania Revenue Authority and Bank of Tanzania computations (Table 3.3.2).

3.2 Import Composition, Year Ending June 2026

Import growth was broad-based across categories: capital goods imports more than doubled (led by machinery, mechanical appliances and industrial transport equipment), consumer goods imports rose 45.6 percent (soap and detergents, textiles, footwear), while intermediate goods imports were roughly flat overall as a 35.7 percent drop in fuel and lubricant imports offset a 48.5 percent rise in industrial supplies.

Chart 9: Zanzibar Import Composition, FY 2026 (USD Million)

Chart unavailable — see Table 7.

Table 7: Zanzibar Imports of Goods, Year Ending June (USD Million)
Category	2025	2026 (provisional)	% Change
Capital goods	68.9	161.0	+133.7%
Intermediate goods	399.1	395.0	-1.0%
of which: Industrial supplies	123.2	183.0	+48.5%
of which: Fuel and lubricants	159.7	102.7	-35.7%
Consumer goods	69.1	100.6	+45.6%
Total imports (f.o.b)	537.2	656.7	+22.2%

Source: Tanzania Revenue Authority and Bank of Tanzania computations (Table 3.3.3).

4. Outlook

Tourism remains the growth engine: With arrivals up 18.9 percent and services receipts up 24.7 percent, tourism continues to be the single biggest driver of Zanzibar's external strength — an encouraging sign as global travel demand remains resilient despite Middle East-driven energy volatility.

Inflation needs monitoring: At 6.0 percent, Zanzibar's headline inflation now sits above Tanzania Mainland's 4.0 percent, driven by food and transport costs. Continued food price pressure could erode real incomes if not addressed through supply-side measures.

Fiscal deficit financed domestically: A TZS 219.2 billion monthly deficit financed entirely through domestic borrowing adds to Zanzibar's public debt burden over time; revenue mobilisation (currently below target on income tax and other taxes) will be key to narrowing this gap.

For the Mainland picture behind these numbers, see TICGL's companion analysis on the full Tanzania Economic Update for July 2026 and Tanzania's national debt position.

Muhtasari kwa Kiswahili

Muhtasari wa Uchumi wa Zanzibar, kutoka Taarifa ya Kila Mwezi ya BOT, Julai 2026

Mfumuko wa bei: Mfumuko wa bei Zanzibar uliongezeka hadi asilimia 6.0 mwezi Juni 2026, kutoka asilimia 4.1 mwaka jana, ukichagizwa na bei za vyakula (asilimia 10.5) na gharama za usafiri zinazohusiana na bei za mafuta.

Bajeti ya Serikali: Mapato ya ndani na ruzuku Zanzibar yalifikia Shilingi bilioni 204.4 mwezi Juni 2026 (asilimia 77.5 ya lengo), huku matumizi yakifikia Shilingi bilioni 423.6 — na kusababisha nakisi ya bajeti ya Shilingi bilioni 219.2, iliyofadhiliwa kwa mikopo ya ndani.

Sekta ya nje: Ziada ya urari wa malipo (current account surplus) iliongezeka kwa asilimia 29.1 hadi dola za Marekani milioni 1,023.2, ikichagizwa zaidi na mapato ya utalii. Idadi ya watalii iliongezeka kwa asilimia 18.9 hadi 949,278.

Biashara ya nje: Mauzo ya bidhaa na huduma nje yaliongezeka kwa asilimia 26.7 hadi dola milioni 1,796.6, huku uagizaji ukiongezeka kwa asilimia 23.1 hadi dola milioni 785.7. Zao la karafuu liliongoza mauzo, likiongezeka kwa kiasi kikubwa kutokana na ongezeko la bei za soko la dunia.

Hitimisho: Utalii unaendelea kuwa nguzo kuu ya uchumi wa Zanzibar, lakini changamoto ya mfumuko wa bei wa chakula na nakisi ya bajeti zinahitaji ufuatiliaji makini katika miezi ijayo.

Frequently Asked Questions

What is Zanzibar's inflation rate in June 2026?

Zanzibar's headline inflation rose to 6.0 percent in June 2026, from 4.1 percent a year earlier, driven mainly by food prices (10.5 percent) and transport costs.

How is Zanzibar's government budget performing?

Domestic revenue and grants reached TZS 204.4 billion in June 2026 (77.5% of target), against expenditure of TZS 423.6 billion, resulting in a TZS 219.2 billion deficit financed by domestic borrowing.

How much did Zanzibar's current account surplus grow?

It grew 29.1 percent to USD 1,023.2 million in the year ending June 2026, from USD 792.4 million a year earlier, driven by tourism receipts.

How important is tourism to Zanzibar's economy?

Tourist arrivals grew 18.9 percent to 949,278, and tourism is the dominant driver of Zanzibar's services account surplus and overall current account strength.

What does Zanzibar mainly export and import?

Exports are led by cloves and non-traditional exports (seaweed, manufactured goods, fish). Imports are dominated by intermediate goods, followed by capital and consumer goods.

Primary source: Bank of Tanzania, "Monthly Economic Review," July 2026 — Section 3.0 "Economic Performance in Zanzibar" and related statistical tables (Tables 3.1.1, 3.3.1–3.3.3, Charts 3.2.1–3.2.2). This analysis is produced by TICGL/TERI for informational and research purposes and does not constitute investment advice.

01 — OverviewExecutive Summary

Read this alongside TICGL's full review of BOT's Strategic Plan 2026/27-2030/31

02 — Framing the QuestionTwo Models of Central Banking

🛡️ The Protective Model (Conventional Inflation-Targeting)

🌱 The Developmental Model (Structural / Directed Credit)

03 — The EvidenceTanzania's Banks Are Holding More Capacity Than Required

Idle Balance-Sheet Capacity: Actual vs Regulatory Floor

04 — Counting the TargetsHow Many of BOT's Own Targets Actually Aim at Growth?

Classification of BOT's ~31 Measurable KPIs by Function

05 — The Other Side of the ArgumentStability Has Genuinely Enabled Credit Growth Before

Inflation Stability and Private-Sector Credit Growth, 2021/22-2029/30

The case for the protective model

The limit of that argument

06 — Comparative EvidenceHow Other Central Banks Balance Protection and Generation

🇿🇼 Zimbabwe: The Cautionary Extreme

🇦🇷 🇹🇷 Argentina & Turkey: Political Pressure on Rate Policy

🇨🇳 China: Structural Directed Credit

🇮🇳 India: Mandated Priority-Sector Lending

🇷🇼 Rwanda: Credit Guarantees at Tanzania's Own Income Level

🇹🇿 Tanzania: Structural Tools Are Named, Not Yet Quantified

07 — TICGL AnalysisSo, Should BOT Do More to Generate Growth?

1. The credit-to-GDP target should not stand alone

2. Quantify the two structural tools already named in the Plan

3. Idle capacity deserves its own tracked metric

4. Tanzania's own history argues for addition, not replacement

08 — TICGL RecommendationsA Disciplined Path Toward a More Generative BOT

09 — Quick AnswersFrequently Asked Questions

Is the Bank of Tanzania's mandate to protect the economy or to grow it?

Do Tanzanian banks have spare capacity to lend more?

What is developmental central banking?

What are the risks of a central bank pushing growth too aggressively?

10 — MethodologySources & Notes

11 — Explore MoreTICGL Economic: Related Insights & Tools

Does BOT's 2026/27-2030/31 Strategic Plan Support FYDP IV and Dira 2050?

What's Next for Tanzania's Economy? The Policy Gaps Keeping $1 Trillion Out of Reach by 2050

Is Tanzania's Economy Growing?

What Opportunities and Risks Define Doing Business in Tanzania in 2026?

Why Tanzania's Economic Growth Has Not Been Sufficiently Inclusive

Tanzania Business Intelligence Dashboard

Muhtasari kwa Kiswahili

01 — OverviewExecutive Summary

Read this alongside TICGL's flagship Dira 2050 policy-gaps analysis

02 — ContextWhat Is the BOT Strategic Plan 2026/27-2030/31?

Seven Key Strategic Focus Areas

Three Thematic Areas, Six Strategic Objectives

03 — Policy AlignmentHow the Plan Maps Onto FYDP IV and Dira 2050

04 — The Track RecordHow Did the 2021/22-2025/26 Plan Actually Perform?

Previous Plan: Baseline vs Target vs Actual, Core Macro Indicators

Inflation: Baseline vs Actual (Q3 2025/26)

Financial Soundness: Baseline vs Actual (Q3 2025/26)

05 — The New CommitmentsWhat BOT Is Targeting by 2029/30

Theme 1 — Macroeconomic Stability

Credit to the Private Sector: The Plan's Boldest Target

Theme 2 — Stability of the Financial Sector

Financial Sector Soundness Targets vs Current Position

Financial Inclusion: Baseline vs 2029/30 Target

Theme 3 — Organizational Capacity

Digital & Institutional Maturity: Baseline vs Target

Governance & ESG: Baseline vs Target

Bank of Tanzania's Own Carbon Footprint: Reduction Target

06 — Reading the Fine PrintWhere BOT's Own Tables Disagree With Each Other

07 — Institutional Self-AssessmentBOT's Own SWOC Analysis

Strengths

Weaknesses

Opportunities

Challenges

08 — TICGL AnalysisSo, Will This Plan Protect Tanzania's Growth?

1. Macro stability is necessary but not sufficient for FYDP IV

2. The credit-to-GDP target is the single biggest lever

3. The GDP growth target undershoots FYDP IV's own ambition

4. Several "targets" are really floors, and that is fine — but should be labelled as such

09 — TICGL RecommendationsGetting the Most Out of BOT's Plan

10 — Quick AnswersFrequently Asked Questions

What is the Bank of Tanzania's Strategic Plan 2026/27-2030/31?

Does BOT's Strategic Plan align with FYDP IV and Dira 2050?

What GDP growth does BOT's plan target by 2029/30?

Did BOT meet its previous five-year targets from 2021/22 to 2025/26?

What is the biggest target BOT has set for credit to the private sector?

11 — MethodologySources & Notes

12 — Explore MoreTICGL Economic: Related Insights & Tools