“Tanzania’s Public Debt Sustainable” — Central Bank Assures
November 22nd, 2018 (Dar es Salaam, Tanzania): The Tanzania private Sector Foundation together with the Economic Society of Tanzania successfully conducted a stake holder engagement with publics centered around “Public Debt in Tanzania”.
The topic of immense interest to the business community and private sector, was the reason TPSF decided to partner with Economic Society of Tanzania. Since it’s re-establishment February earlier this year. A priority of the society since it’s revitalization, has been to provide platforms for emerging ideas especially those stemming from economic research, whilst raising awareness and stimulating conversations along the same.
Speaking at the forum Dr. Tausi Kida the Executive Director at the Economic Social & Research Foundation and the Vice President at the Economic Society of Tanzania, highlighted the importance of such forums and dialogues and the need for stakeholders to participate in them. In light of the topic of public Debt in Tanzania Dr. Kida stated that “There is no harm in debt, however we all have a collective duty to ensure the money is spent as intended”.
The Director of Policy at TPSF Mr. Gilead Teri, in pointing the private sector’s interest was heard saying, “Over the past year we have been receiving incremental concerns from our members that arrears to the private sector are on the rise, thus when an opportunity presented itself to look into the matter we were on board”. Mr. Gilead was in representation of TPSF Executive Director Mr. Godfrey Simbeye who was attending to other official commitments.
The presentation delivered by veteran academician Prof. Mbelle titled the Paradox of Public Debt Sustainability, worked closely with the Central Bank and brought forth some interesting findings. The Report sought to gain a unique perspective on Tanzania’s debt situation and it’s sustainability by gauging the Debt ratio against GDP, Revenue and Export among other key indicators. It was identified that the current Debt ratio to GDP stood close to 4 years, in literal terms it would take Tanzania approximately 4 years if it’s GDP was solely dedicated to debt settlement.
With this in mind is Tanzania Public Debt Sustainable? At the moment “Yes”, in accordance with sustainability ratios measured, a conclusion echoed by Dr. Maduhu Kazi the Director of Economic research at the Central Bank. The Forum was assured by Dr. Maduhu that the findings of their 2018 report was credible of which, it was compiled with external stakeholders. The Current Tanzania Government debt stands at 37.40% of country’s GDP as of 2017, this is lower than all countries in EAC (Kenya 57.10%, Uganda 38.60% , Rwanda 40.20%) and less than the global level of 59.9 However, concerns were raised on public debt being perceived to grow at a faster rate than the economy, as well as the accumulation of arrears.
According to Dr. Blandina Kilama CEO at Economic Society of Tanzania, a host of series of similar engagements were in the pipeline, to discuss economic issues of public interest.