Dar es Salaam. Investors could be rubbing their hands in glee as authorities plan the issuance of municipal bonds in the endeavour to get funds to finance local government’s infrastructure development needs and related projects.
Basically, a municipal bond is a debt security issued by a state, municipality or county to finance its capital expenditures, including the construction of highways, bridges or schools.
This comes at a time when the central government was working towards streamlining and improving revenue collection, resulting into transferring some local government’s sources like property tax abd service levy to Tanzania Revenue Authority (TRA).
But according to the board chairman for the Capital Markets and Securities Authority (CMSA), Dr John Mduma, some municipal bonds would be issued during the coming financial year.
This - he said during a function to award certificates to 60 students who had excelled in the Securities Industry Certification Course (SICC) – was in line with the CMSA’s strategic plan for the financial year 2018/19.
“One of our major strategic plans for 2018/19 is to initiate the issuance of municipal bonds…it is proposed that the plan must be coordinated at national level….well implemented, the plan will give special impetus to the growth of capital market and thus boost economic growth,” Dr Mduma told participants to an event that was graced by Deputy Finance and Planning minister, Dr Ashatu Kijaji.
Improved infrastructure at local government level, he said, would attract investors would bring the much-needed funds to enhance Tanzania’s well-publicised industrial revolution dream.