DODOMA: Tanzania plans to increase public spending by about 10% in the next financial year as it prepares to implement its long-term economic strategy aimed at transforming the country into a high-income economy by mid-century.
Finance Minister Khamis Mussa Omar told parliament on Wednesday that the government had proposed a budget of 62.33 trillion Tanzanian shillings (about $24 billion) for the 2026/27 fiscal year, up from 57.04 trillion shillings in the current year.
The spending plan forms the first budget aligned with Tanzania’s National Development Vision 2050, which aims to transform the country into an inclusive, prosperous and industrialised economy by 2050.
The government intends to maintain a fiscal deficit of about 3% of gross domestic product, in line with fiscal convergence criteria agreed by the East African Community and the Southern African Development Community.
Between January and June 2026, the government expects to collect and spend roughly 28.27 trillion shillings, or about half of the current fiscal year’s budget.
Domestic revenue is projected to contribute about 20.16 trillion shillings, while grants and borrowing will finance the remaining balance.
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The government plans to borrow 15.54 trillion shillings in the coming fiscal year, including domestic and external loans, while repaying 7.84 trillion shillings in maturing debt.
Public debt stood at 109.44 trillion shillings by December 2025, equivalent to about 47% of GDP, the finance minister said.
Much of the borrowing has funded large infrastructure projects including railways, roads, electricity generation and water systems.
The government says a recent debt sustainability analysis concluded that Tanzania’s debt remains manageable in the medium and long term.
The 2026/27 budget will also launch the Fourth Five-Year Development Plan (FYDP IV) covering 2026–2031, which prioritises industrial growth, human capital development, climate resilience and governance reforms.
