TANZANIA’S economy is recording strong and stable growth despite persistent external pressures linked to global geopolitical tensions, top officials say,
Emmanuel Tutuba, governor of the Bank of Tanzania (BoT), made this affirmation in remarks after a recent monetary policy committee meeting, affirming that the country’s macroeconomic environment remains broadly resilient, supported by solid performance across key productive sectors and prudent management of monetary and fiscal policies.
Tanzania’s economic fundamentals constitute a buffer against global shocks, including disruptions linked to conflicts in the Middle East and volatility in international commodity markets, he said.
Real gross domestic product (GDP) growth is estimated at around 6 percent in the first half of 2026, due to sustained expansion in agriculture, construction, mining, financial services and transport, while Zanzibar’s economy recorded an estimated growth rate of 6.6 percent over the same period.
Expansion was largely driven by a rebound in tourism and increased construction activity, with overall economic growth across the country expected to remain above 6/0 percent in the second half of 2026, with investment inflows, improved productivity and stable macroeconomic conditions, he elaborated.
Monetary conditions were moderately accommodative, enabling significant expansion of credit to the private sector, with lending to businesses and households growing at 24 percent on average, tied to strong demand for financing in agriculture, manufacturing, trade and infrastructure development.
The trend signals growing confidence in the banking system and improved access to credit, even as the central bank closely monitoring inflationary pressures to ensure price stability is maintained.
The resilience of the financial sector was evident as commercial banks remain profitable, well-capitalised and stable under strengthened regulatory oversight and improved risk management practices.
The ratio of non-performing loans stood at 2.9 percent, comfortably below the regulatory threshold of 5.0 percent, indicating strong asset quality and improved loan recovery across the sector.
Steady progress in domestic revenue mobilization was equally visible; collections are projected to reach 16.8 percent of GDP for fiscal 2025/2026, up from 15.6 percent earlier, reflecting improved tax administration, strengthened compliance measures and ongoing reforms aimed at broadening the revenue base, he explained.
Stronger domestic revenue performance is expected to support government expenditure on infrastructure development, social services and strategic national projects while reducing dependence on external borrowing.
Notwithstanding uncertainties in the global economy especially from geopolitical conflicts and disruptions in global supply chains, the country’s economic outlook remains positive, with resilience tied to strong domestic demand, a diversifying economic base and consistent macroeconomic policy coordination between fiscal and monetary authorities, he specified.
Reaffirming the central bank’s commitment, to safeguard financial stability while supporting sustainable economic growth. Close coordination between monetary and fiscal institutions is essential in sustaining current growth momentum and achieving the country’s long-term development objectives, he added.