The national debt stock remained broadly stable at $47,640.5 million in January 2025, a 0.1 percent decline from the previous month.

The decrease was primarily driven by a marginal decline in external debt, which was partially offset by increased domestic borrowing, mainly through the issuance of long-term government securities and the utilization of overdraft facility.

The external debt stock (public and private) recorded a monthly decrease of 0.5 percent, reaching $33,905.1 million at the end of January 2025. Of this amount, 76.4 percent was public debt, while the remainder was private sector debt. 

External loan disbursements during the month totalled $101.8 million, primarily to the central government, whereas external debt service amounted to USD 133.4 million, including $102.6 million in principal repayments and the remaining balance in interest payments. 

The composition of external debt by creditors remained unchanged from both the previous month and the corresponding month in 2024. By the beneficiary economic activity, transportation and telecommunications retained the largest share of outstanding disbursed debt (Table 2.6.2 and 2.6.3). The currency structure of external debt also remained unchanged, with the US dollar maintaining its dominant position.

The domestic debt stock recorded a monthly increase of 1,505.6bn/- reaching 34,154.9bn/- at the end of January 202. 

The increase was mainly attributed to higher utilization of overdraft facility, coupled with the issuance of long-term government securities, which significantly outweigh the redemptions. 

The domestic debt portfolio remained unchanged, with Treasury bonds dominating at 78.2 percent of the total, while commercial banks and pension funds continued to be the Government’s primary domestic creditors.

Select State-Owned Enterprises (SOEs) had an outstanding domestic debt of 84.2bn/- at the end of January 2025 compared to 74.1bn/- in the previous month. This increase was driven by DAWASA, whose debt increased by 9.2bn/- .

​As of the latest assessments, Tanzania's risk of external debt distress is considered moderate. The International Monetary Fund (IMF) and World Bank's Debt Sustainability Analysis (DSA) indicates that Tanzania's risk of external debt distress has increased to moderate, primarily due to the effects of the COVID-19 pandemic and other external shocks

In December 2024, the IMF's Executive Board completed reviews under the Extended Credit Facility and the Resilience and Sustainability Facility arrangements with Tanzania, making available approximately $204.5 million. This financial support aims to bolster Tanzania's economic resilience and address fiscal challenges.

Additionally, the government's draft budget for the fiscal year starting in July 2025 proposes a 13.4% increase in spending, reaching 57.04trn/- (approximately $22 billion). 

This budget emphasizes debt repayment, funding for the upcoming general election, and addressing the impact of paused foreign aid from the United States. The reliance on both domestic and external debt to finance the budget underscores the importance of maintaining debt sustainability.

According to IMF, Tanzania's external debt distress risk remains moderate, ongoing fiscal management, transparency in project financing, and prudent debt policies are crucial to ensure long-term debt sustainability.

“Tanzania’s capacity to repay its debt to the International Monetary Fund (IMF) remains robust, underpinned by a strong track record of servicing obligations and sound economic management practices,” said a report by IMF released in January 2025.