Joseph Isangura
The government of Tanzania has earmarked Sh14.2 trillion for debt servicing in the proposed 2025/26 national budget. The announcement was made on Wednesday, June 4, 2025, by the country’s Minister for Finance, Dr. Mwigulu Nchemba, during his presentation to Parliament.
This figure represents a considerable share—nearly 71 percent—of the Ministry of Finance and Planning’s total proposed allocation of Sh20.1 trillion for the year, underscoring the state’s commitment to addressing public debt.
Dr. Nchemba noted that the government is prioritizing macroeconomic stability, improved domestic revenue collection, and increased transparency in public finance. “The objective is to balance investment in critical sectors while ensuring the country meets its debt obligations on time,” he told lawmakers.
According to the minister, the government plans to raise a total of Sh40.97 trillion in revenue during the 2025/26 fiscal year, largely through domestic sources, including taxes and levies collected by the Tanzania Revenue Authority (TRA). Additional financing will be sought via external loans and grants—though within sustainable limits.
Part of the funding will go toward preparations for the upcoming general election in October 2025, in which President Samia Suluhu Hassan is expected to seek a new mandate. The budget also includes allocations for co-hosting the 2027 Africa Cup of Nations (AFCON) with Kenya and Uganda, a milestone event in East African sports diplomacy.
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Dr. Nchemba said that beyond elections and infrastructure, the budget will sustain ongoing investments in education, healthcare, agriculture, and energy—areas identified as essential to driving inclusive growth.
This proposed financial plan is being carefully examined in Parliament, where lawmakers are expected to deliberate on how best to implement the budget amid both domestic economic challenges and global uncertainties. Once approved, the budget will officially commence on July 1, 2025, marking the beginning of a critical fiscal cycle for Tanzania.
Observers, including economists and civil society groups, have welcomed the transparency shown in budget disclosure, though many urge the government to stay vigilant about borrowing trends. Some also emphasize the importance of ensuring that public funds translate into tangible improvements in livelihoods.
