Tanzania’s Domestic Debt Surges to TZS 38. 6 Trillion, Treasury Bonds Lead. DAR ES SALAAM, Tanzania — As of the end of January 2026, Tanzania’s domestic debt stock has reached TZS 38.
6 trillion, marking a 1. 9 percent increase from the previous month, according to the Bank of Tanzania’s Monthly Economic Review.
The rise in domestic debt is primarily driven by an increasing reliance on Treasury bonds, which now constitute over 80 percent of the total domestic debt and 85 percent of all government securities.
The shift towards long — term borrowing instruments, such as Treasury bonds, has allowed the government to push repayment obligations further into the future, reducing the need for frequent refinancing.
However, this strategy also comes with higher interest costs over time.
In January 2026 alone, the government paid TZS 365.
9 billion in interest on domestic debt, surpassing the TZS 303. 9 billion spent on repaying principal.
Government securities, particularly Treasury bonds, are now the preferred investment for pension funds and commercial banks, which together hold more than half of Tanzania’s domestic debt stock.
This financial ecosystem has been structured around government securities, with public institutions, private companies, and individuals also contributing to the debt portfolio.
The government’s reliance on domestic borrowing has diminished its dependence on foreign currency loans and shielded the budget from exchange rate fluctuations.
However, the rapid increase in domestic debt raises concerns about future refinancing risks and the potential for crowding out private credit if fiscal deficits persist.
The World Bank’s Tanzania Economic Update highlights that while Tanzania’s public debt remains manageable by international standards when measured against the size of the economy, the structure of the debt and its ownership are crucial factors.
The increasing dependency of the domestic banking and pension sectors on government borrowing patterns raises concerns about the stability of these sectors.
The government’s focus on domestic borrowing and the growth of the Treasury bond market reflect the country’s ambition to finance large-scale infrastructure projects and manage public finances more effectively.
However, it also underscores the need for careful management of interest costs, maintaining investor confidence, and ensuring that borrowing does not inadvertently stifle economic growth. Further details are expected as the government continues to navigate the evolving dynamics of its domestic debt market.
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Source: Tanzania’s Domestic Debt Hits TZS 38.
6 Trillion, Treasury Bonds Take the Lead. — panafricanvisions.
*Additional reporting by ImNews | Sources consulted: 5*
