Tanzania to Borrow $2.34 Billion for 2022/2023 Budget

Tanzania has announced plans to borrow at least $2.34 billion from foreign sources to finance its proposed 2022/2023 budget of $17.1 billion.

According to Finance minister Mwigulu Nchemba, 7.7% ($1.32 billion) of next financial year’s budget will be funded through direct concessional loans and grants from development partners under the traditional general budget support arrangement. Another $1.04 billion is expected to come from project-specific commercial loans from international lenders.

The government will borrow a further $2.32 billion from the domestic market towards ensuring at least $12.4 billion, internal financing of its 2022/2023 budget to balance the external funding.

As The East African reports, Tanzania’s total national debt currently stands at $33.88 billion.

According to MNchemba, next year’s budget will again prioritise external and domestic debt repayment along with the continued implementation of key infrastructure projects, including the standard gauge railway, the 2,115-megawatt Rufiji hydropower dam and revival of the ailing national carrier, Air Tanzania.

Other projects are the East African Crude Oil Pipeline from Uganda to Tanga and a liquid natural gas processing plant in Lindi.

In September this year, the International Monetary Fund (IMF) approved a $567.25 million loan for Tanzania, aimed at helping the country finance its urgent balance of payments needs arising from the global COVID-19 Pandemic.

The financing package comprised $189.08 million under the Rapid Credit Facility (RCF) and a purchase equivalent to $378.17 million under the Rapid Financing Instrument (RFI).

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Kenya’s External Debt Climbs to $37 Billion in First Six Months of 2021