Dar es Salaam. Tanzania’s economy is projected to sustain its recovery momentum, with growth estimated at 6.9 percent in the fourth quarter of 2025 and 6 percent for the full year, according to the latest Monetary Policy Statement issued by the Bank of Tanzania (BoT).
The central bank expects the economy to expand further in 2026, with growth forecast at 6.4 percent, supported by continued public investment in strategic infrastructure projects, including railways, roads, and airports.
Key sectors such as tourism and manufacturing are also expected to underpin this growth, according to the report.
Additional stimulus is anticipated from the construction of sports facilities ahead of the upcoming Africa Cup of Nations (AFCON) tournaments, which are projected to boost economic activity further.
“For Tanzania, rising gold prices will enhance export revenues and bolster foreign reserves, while falling oil prices will reduce import costs and ease inflationary pressures,” the report states, adding that these developments create a favorable external environment, offering policy space to maintain or cautiously lower the central bank rate (CBR) to reinforce domestic economic growth while preserving macroeconomic stability.
The private sector continues to gain traction, with both foreign and domestic investment showing steady growth.
According to the report, credit to the private sector is expected to expand by around 17 percent yearon-year in the fourth quarter of 2025, supported by the accommodative monetary policy implemented since July 2025 and strong demand for loans.
Banks have reported loan applications worth Sh1.1 trillion, mainly from the trade and construction sectors, which are currently under review and may be disbursed in the coming months.
Exports are projected to remain robust in the final quarter of 2025, driven by gold, cash crops such as cashew nuts and tobacco, tourism, and transport services.
Fourth-quarter exports are expected to reach $2.97 billion, up from $2.9 billion in the same period last year.
Production of key cash crops— including cashew nuts, tobacco, cotton, and coffee—is forecast to rise by 42 percent in the 2025/26 fiscal year, while tourism receipts are expected to climb to Sh12.9 billion, compared with Sh10.9 billion in 2024/25.
The Zanzibar economy is also projected to perform strongly, with growth estimated at 7.2 percent in the fourth quarter of 2025 and 7.3 percent for the whole year, driven by the services sector.
Rising tourist arrivals, increased accommodation activities, the revival of clove harvesting, and ongoing construction projects supporting quarrying activities are cited as key drivers.
Inflation in Mainland Tanzania is expected to remain stable at 3.5 percent, within the target range of 3–5 percent, while in Zanzibar it is forecast to stay below 5 percent.
This outlook is supported by reliable electricity supply, stable exchange rates, and adequate food availability.
The BoT noted that prudent implementation of monetary and fiscal policies will continue to contain inflationary pressures, although climate change-related shocks remain a low-level risk.
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