Prepared by TERI for research and strategic-information purposes only; it is not investment, legal, tax or financial advice. Figures are from the Bank of Tanzania; August 2026 data are provisional and July 2026 is revised. Growth rates, shares of arrears and exchange-rate effects marked "TERI calculation" are derived from published figures. Tables 2.6.3 and 2.6.4 cover disbursed outstanding debt (DOD) of USD 36,422.5 million, which excludes USD 309.0 million of interest arrears.
01 — OverviewExecutive Summary
The stock of national debt rose 1.7% month on month to USD 52,224.4 million at end-August 2026, with external debt accounting for 70.3%. The external component, public and private, stood at USD 36,731.5 million, up 0.8% from July. During August, external loan disbursements were USD 160.1 million, mostly to the central government, and debt service was USD 139.1 million, of which USD 69.2 million was principal. Multilaterals hold 59.5% of the stock, commercial lenders 34.4%, bilateral creditors 4.3% and export credit agencies 1.8%.
The debt is concentrated, concessional-heavy and dollar-linked. Four-fifths is sovereign, nearly 60% is multilateral, and 64.9% is in US dollars. That structure is manageable while the shilling is stable, but the shilling depreciated 6.7% against the dollar over the year, and the fastest growth is in private-sector borrowing and in arrears, where oversight is weakest.
1. External Debt Stock by Borrower
The central government owed USD 30,751.9 million (83.7%) at end-August 2026, the private sector USD 5,979.6 million (16.3%), and public corporations nothing: TANESCO, ATCL, TRC, TPA, TFC and DAWASA have no outstanding external debt. The private sector's share has crept up from 15.3% a year earlier.
| Borrower (USD million) | Aug 2025 | Share | Jul 2026 | Aug 2026 | Share | y/y |
|---|---|---|---|---|---|---|
| Central government | 28,745.9 | 84.7% | 30,512.1 | 30,751.9 | 83.7% | +7.0% |
| Disbursed outstanding debt | 28,667.2 | 84.5% | 30,431.6 | 30,671.3 | 83.5% | +7.0% |
| Interest arrears | 78.7 | 0.2% | 80.5 | 80.6 | 0.2% | +2.4% |
| Private sector | 5,192.9 | 15.3% | 5,942.2 | 5,979.6 | 16.3% | +15.2% |
| Disbursed outstanding debt | 5,088.1 | 15.0% | 5,732.0 | 5,751.2 | 15.7% | +13.0% |
| Interest arrears | 104.8 | 0.3% | 210.2 | 228.4 | 0.6% | +118.0% |
| Public corporations | 1.3 | 0.0% | 0.0 | 0.0 | 0.0% | — |
| External debt stock | 33,940.1 | 100% | 36,454.3 | 36,731.5 | 100% | +8.2% |
Source: Bank of Tanzania, Table 2.6.1. Year-on-year changes are TERI calculations.
External Debt Stock
Interest Arrears
Private-sector interest arrears reached USD 228.4 million, up from USD 104.8 million a year earlier, equal to 3.8% of private external debt compared with 0.26% for central government (TERI calculation). Total external debt arrears rose to USD 1,040.0 million, with commercial creditors owed USD 417.8 million in principal and USD 163.8 million in interest.
1.1 Creditor structure
| Creditor (USD million) | Aug 2025 | Share | Aug 2026 | Share |
|---|---|---|---|---|
| Multilateral | 20,014.9 | 59.0% | 21,867.4 | 59.5% |
| Commercial | 11,694.9 | 34.5% | 12,633.7 | 34.4% |
| Bilateral | 1,557.5 | 4.6% | 1,568.2 | 4.3% |
| Export credit | 672.8 | 2.0% | 662.1 | 1.8% |
02 — Use of FundsWhat the Borrowing Financed
Balance of payments and budget support is the largest use of disbursed outstanding debt at 23.6%, followed by transport and telecommunications (21.8%), social welfare and education (19.3%) and energy and mining (12.6%). Together these four account for 77.3% of DOD. The composition was broadly unchanged from July.
| Use of funds | Share Aug 2025 | Share Jul 2026 | Share Aug 2026 | Aug 2025 $M | Aug 2026 $M | y/y |
|---|---|---|---|---|---|---|
| BoP and budget support | 23.2% | 23.6% | 23.6% | 7,834.4 | 8,582.7 | +9.6% |
| Transport and telecommunication | 21.0% | 21.6% | 21.8% | 7,096.1 | 7,930.4 | +11.8% |
| Social welfare and education | 19.9% | 19.3% | 19.3% | 6,711.7 | 7,014.7 | +4.5% |
| Energy and mining | 11.9% | 12.7% | 12.6% | 4,026.5 | 4,600.1 | +14.2% |
| Agriculture | 5.1% | 5.2% | 5.2% | 1,722.6 | 1,903.6 | +10.5% |
| Real estate and construction | 5.5% | 4.8% | 4.7% | 1,844.6 | 1,727.8 | −6.3% |
| Finance and insurance | 3.6% | 4.2% | 4.2% | 1,212.7 | 1,525.3 | +25.8% |
| Industries | 2.9% | 2.6% | 2.7% | 992.2 | 966.9 | −2.5% |
| Tourism | 1.8% | 1.6% | 1.6% | 597.1 | 598.0 | +0.2% |
| Other | 5.1% | 4.3% | 4.3% | 1,718.7 | 1,573.0 | −8.5% |
| Total DOD | 100.0% | 100.0% | 100.0% | 33,756.6 | 36,422.5 | +7.9% |
Sources: Bank of Tanzania, Table 2.6.3 (shares) and Table A10 (amounts). Year-on-year changes are TERI calculations.
Share of DOD by Use of Funds
Growth in DOD by Use of Funds
- Growth is fastest in finance and insurance (+25.8%) and energy and mining (+14.2%), reflecting private-sector and project borrowing.
- Productive sectors are small: agriculture and industries together are only 7.9% of DOD, although agriculture employs most Tanzanians.
- Budget support rose faster than education and social welfare, raising the share of debt that finances recurrent needs rather than assets that generate foreign exchange.
03 — Currency CompositionWhich Currencies the Debt Is Owed In
The US dollar accounts for 64.9% of disbursed outstanding external debt, down from 65.4% a year earlier. The euro's share rose to 18.4% from 17.9%, the Chinese yuan holds 6.7% and other currencies 10.0%.
| Currency | Share Aug 2025 | Share Jul 2026 | Share Aug 2026 | Aug 2025 $M | Aug 2026 $M | y/y |
|---|---|---|---|---|---|---|
| United States dollar | 65.4% | 65.1% | 64.9% | 22,090.5 | 23,632.6 | +7.0% |
| Euro | 17.9% | 18.2% | 18.4% | 6,045.9 | 6,696.7 | +10.8% |
| Chinese yuan | 6.6% | 6.7% | 6.7% | 2,218.0 | 2,452.7 | +10.6% |
| Other | 10.1% | 10.0% | 10.0% | 3,402.0 | 3,640.5 | +7.0% |
| Total DOD | 100.0% | 100.0% | 100.0% | 33,756.6 | 36,422.5 | +7.9% |
Sources: Bank of Tanzania, Table 2.6.4 and Table A10. Year-on-year changes are TERI calculations.
Currency Composition, August 2026
Debt by Currency
The end-of-period rate moved from TZS 2,463.3 to TZS 2,639.9 per USD over the year, a 7.2% depreciation (TERI calculation). On a dollar-linked stock of USD 23,632.6 million, that adds roughly TZS 4.2 trillion to the shilling value of the dollar debt alone, before euro and yuan effects. Gross official reserves of USD 5,888.2 million cover 4.2 months of imports.
04 — AnalysisRisks and Strengths
- Strength, concessional mix: with 59.5% multilateral, much of the stock should carry long maturities and lower rates than commercial debt.
- Strength, no public-corporation debt: central government control limits hidden contingent liabilities from state enterprises.
- Dollar dependence: 64.9% of DOD is in USD, so depreciation or a strong dollar raises the shilling cost of servicing.
- Commercial debt of USD 12,633.7 million (34.4%) is costlier and arrears to commercial creditors are growing fastest.
- A rising share of budget support means more borrowing finances consumption, not export-generating assets.
- Higher oil and freight costs are widening the current account deficit to USD 2,481.8 million, tightening foreign-exchange availability.
Undisbursed commitments fell to USD 15,302.9 million from USD 18,855.9 million a year ago, so total committed external debt is USD 51,725.3 million, and the pipeline for new disbursements is shrinking even as the stock rises.
05 — RecommendationsPolicy Recommendations
1. Manage currency risk
- Raise the share of shilling and concessional multi-currency borrowing.
- Publish a hedging and currency-risk strategy within the medium-term debt strategy.
2. Align borrowing with productive use
- Prioritise projects that earn foreign exchange, such as agriculture, energy and industry.
- Publish project-level use-of-funds reports.
3. Clear and monitor arrears
- Set a plan to clear commercial arrears of USD 581.6 million (principal and interest).
- Strengthen oversight of private external borrowing and its reporting.
4. Plan for investors and lenders
- Investors should weigh sovereign exposure and FX conditions when pricing Tanzania risk.
- Project sponsors should match revenue currency to debt currency.
"Debt that is 84% sovereign, 60% multilateral and 65% in dollars is a sound structure only as long as the shilling holds and the borrowing builds assets that earn dollars. The composition tells us where the risk sits."
— TICGL / Tanzania Economic Research Institute (TERI)
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✉️ economist@ticgl.com →06 — Quick AnswersFrequently Asked Questions
How large is Tanzania's external debt?
USD 36,731.5 million at end-August 2026, up 0.8% from July and 8.2% from a year earlier.
Which currencies is the debt in?
US dollar 64.9%, euro 18.4%, Chinese yuan 6.7% and other currencies 10.0%.
What was the borrowing used for?
Balance of payments and budget support 23.6%, transport and telecommunications 21.8%, social welfare and education 19.3%, energy and mining 12.6%.
Who owes the debt?
Central government 83.7% (USD 30,751.9m) and private sector 16.3% (USD 5,979.6m).
Built from the Bank of Tanzania Monthly Economic Review, September 2026: Section 2.6, Tables 2.6.1 to 2.6.4 and Table A10. Y/Y growth rates, arrears ratios and the exchange-rate effect are TERI calculations; the exchange-rate effect is illustrative and ignores hedges and repayment timing.
Muhtasari kwa Kiswahili
Deni la Nje la Tanzania, Agosti 2026 — Deni la nje (sekta ya umma na binafsi) lilifikia Dola milioni 36,731.5 mwishoni mwa Agosti 2026, ongezeko la 0.8% kutoka Julai na 8.2% kwa mwaka. Serikali Kuu inadaiwa 83.7% na sekta binafsi 16.3%; mashirika ya umma hayana deni la nje.
Matumizi ya mikopo: Msaada wa urari wa malipo na bajeti 23.6%, usafirishaji na mawasiliano 21.8%, huduma za jamii na elimu 19.3%, nishati na madini 12.6%. Kilimo ni 5.2% tu.
Sarafu: Dola ya Marekani 64.9%, Euro 18.4%, Yuan ya China 6.7%, nyingine 10.0%. Shilingi ilishuka thamani takriban 7.2% kwa mwaka (hesabu za TERI), hivyo gharama ya kulipa deni la dola imeongezeka.
Hatari: Madeni ya riba yaliyochelewa yamefikia Dola milioni 1,040.0 (kutoka 578.9), na ya sekta binafsi yameongezeka mara mbili. Wakopeshaji wa kibiashara wanamiliki 34.4% ya deni.
Mapendekezo: Kupunguza hatari ya sarafu, kuelekeza mikopo kwenye miradi inayozalisha fedha za kigeni, kulipa malimbikizo, na kusimamia mikopo ya sekta binafsi.
- Deni la nje: $36,731.5M | Serikali Kuu: 83.7%
- Dola: 64.9% | Wakopeshaji wa pande nyingi: 59.5%
- Malimbikizo: $1,040.0M
Chanzo: Benki Kuu ya Tanzania, Monthly Economic Review, Septemba 2026. Maelezo zaidi: economist@ticgl.com.