Dodoma. Tanzania's public debt rose by 8.97 percent to Sh114.34 trillion as the government continued to borrow from both domestic and external sources to finance development projects across the country.
According to the National Development Plan tabled in Parliament on Thursday June 11, 2026, the debt reached Sh114.34 trillion as of March 2026, up from Sh104.93 trillion recorded during the corresponding period in 2025.
The report also shows that domestic debt stood at Sh38.45 trillion, while external debt amounted to Sh75.89 trillion.
"The increase in debt resulted from the government continuing to receive both new and existing loans from domestic and external sources for the implementation of development projects," the report states.
Despite the rise in debt, the government maintained that Tanzania's debt remains sustainable over the medium and long term.
According to a debt sustainability assessment conducted in November 2025, the country's debt indicators remained within internationally accepted thresholds during the 2025/26 financial year.
The assessment found that the present value of external debt to Gross Domestic Product (GDP) stood at 24.4 percent, well below the 40 percent ceiling, while the ratio of external debt to exports was 123.1 percent against a threshold of 180 percent, according to the document.
Similarly, external debt servicing accounted for 12.8 percent of export earnings compared with the 15 percent limit, while debt service as a share of domestic revenue stood at 15.4 percent, below the 18 percent ceiling.
The present value of total public debt to GDP was 39.6 percent, lower than the sustainability threshold of 55 percent.
"According to the assessment, government debt is sustainable in the medium and long term," the document states.
The report also highlights Tanzania's stable sovereign credit ratings, citing positive assessments by international rating agencies.
In February 2026, Moody's Investors Service maintained Tanzania's B1 credit rating with a Stable Outlook, unchanged from March 2025. Fitch Ratings also affirmed the country's B+ rating with a Stable Outlook in March 2026.
The government said the ratings reflected the country's strong economic fundamentals, including sustained GDP growth, stable inflation and prudent debt management.
"This is attributable to the continued strength of economic fundamentals, including GDP growth, inflation stability and sustainable government debt," the report notes.
According to the government, the ratings are expected to bolster investor confidence and enhance Tanzania's access to international financing.
The report states that the positive assessments "strengthen the confidence of domestic and foreign investors in the stability of the economy and the government's ability to manage debt," helping to lower borrowing costs in international markets and improve access to financing for development projects.
