The nation's total debt stock reached $51 billion (nearly 132trn/-) by the end of January 2026, marking a subtle 0.1 percent increase from the previous month, data from Bank of Tanzania’s (BoT) monthly economic review for February reveal.
This figure highlights a period of calculated fiscal management as the government balances large-scale infrastructure financing with a stable domestic securities market.
External debt remains the primary component of the national portfolio, accounting for 70.0 percent of the total debt stock.
The World Bank and African Development Bank remain the largest lenders, providing roughly 48 percent of external debt, largely on concessional terms (low interest, long grace periods).
By the end of January, according to the central bank report, the external debt stock—comprising both public and private sector obligations—rose by 0.6 percent to reach $35,750.7 million (nearly 91trn/).
The profile of Tanzania’s international creditors remains consistent as multilateral institutions continue to hold the largest share, representing 58.2 percent of the total external stock.
During the reported month, the country received $122.9 million in new disbursements, primarily directed toward government projects.
Simultaneously, Tanzania maintained its creditworthiness through $98.5 million in debt service payments, of which $81.1 million was dedicated to principal repayments.
In terms of how these funds are utilized, balance of payments and budget support remain the leading categories for disbursed outstanding debt, closely followed by investments in transport and telecommunications.
Currency-wise, the US dollar continues to dominate the external debt composition, followed by the Euro.
On the home front, the domestic debt stock stood at 38.6trn/- at the end of January 2026, a monthly increase of 1.9 percent.
A notable trend in the domestic market is the heavy concentration in long-term instruments. Treasury bonds now form the backbone of this portfolio, with commercial banks and pension funds holding 55.2 percent of the total domestic debt.
The government successfully mobilized 263.7bn/- through securities in January, split between 113bn/- in Treasury bonds and 150.7bn/- in Treasury bills. Domestic debt servicing for the month was substantial, totaling 669.8bn/- , which included 303.9bn/- in principal and 365.9bn/- in interest payments.
January’s Treasury bill auctions, for both liquidity and financing o purposes, were significantly oversubscribed, attracting bids worth 514.2bn/- against a tender size of 390.9bn/- . The overall weighted average yield remained stable at 5.89 percent.
Favorable borrowing conditions were also evident in the bond market as a 10-year Treasury bond auction attracted 194.1bn/ - in bids, surpassing the 144.6bn/- offered.
Weighted average yields for these bonds eased to 11.30 percent, a signal that the Bank of Tanzania interprets as sustained confidence in the domestic debt market and favorable conditions for long-term government borrowing.
However, Tanzania’s debt remains sustainable with a moderate risk of debt distress, according to the 2025 Debt Sustainability Analysis (DSA) conducted jointly by the IMF and the World Bank.
While debt levels have increased to support major infrastructure projects, key indicators remain below the critical thresholds that would signal high distress.
While the debt stock has grown, Tanzania’s ability to manage its international obligations is supported by a strengthening external sector.
The current account deficit narrowed to $1,927.8 million for the year ending January 2026, down from $2,448.5 million the previous year. This improvement was driven by a 12.7 percent surge in exports, particularly gold and tourism receipts.
Furthermore, foreign exchange reserves climbed to $6,295.3 million, which provides a critical safety net, covering 4.8 months of projected imports—well above the national and East African Community (EAC) benchmarks.
As the government continues to align its expenditure with available resources, the combination of robust reserves and stable domestic interest rates suggests a manageable path forward for the nation's $51 billion debt profile.
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