THE national debt reached 16.16 billion US dollars, equivalent to 59.48trl/- up to 30th April this year, and remains sustainable in medium and long term, the Deputy Minister for Finance, Dr Ashatu Kijaji has said.
She said in Parliament yesterday that the national debt includes public and private sector debt and the
government is responsible to service the public debt only.
The Deputy Minister was responding to a question from Masoud Abdallah Salim (Mtambile, CUF) who wanted to know the level of the national debt up to the time his question was being answered in Parliament.
The Mtambile legislator wanted also to know about details of funds set aside to service the debt.
The Deputy Minister said funds to service public debt were being set aside through normal budgetary allocation. She said the government set 1.262tri/- for payment of domestic debt and 685.06bn/- for external debt.
There were no money in a special fund for servicing national debt, she added. However, according to the Central Bank, the national debt is declining as the government continues to honour its payment obligations.
The Central bank said in its latest monthly economic review that the external debt, comprising public and private sector debt, amounted to USD 20,027.7 million at the end of April 2018, a USD 128.9 million decrease from the level registered at the end of the preceding month.
The decrease was on account of debt service payment and appreciation of US dollar against other currencies in which the debt is denominated.
The Deputy Minister said the government was servicing the public debt using domestic resources and had never defaulted in the payments.
She said the Ministry of Finance and Planning was conducting its activities in highest level of diligence particularly in implementing government directive on domestic and external debt servicing.
In his supplementary question, the legislator asked why the government continued to borrow when the debts levels were soaring. He wanted also to know when the government would conduct a review on the national debt.
The Deputy Minister said the review of the national debt would be conducted from next financial year.
The Minister for Finance and Planning, Dr Phillip Mpango said in Parliament last week that the government conducted a public debt sustainability analysis which indicated the debt was sustainable in medium and long term.
The Minister said the ratio of the public debt to GDP was 34.4 per cent compared to a threshold of 56 per cent. The value of external debt to GDP was 19.7 per cent compared to a threshold of 40 per cent.