IMF Approved $150 Million Loan for Tanzania

The International Monetary Fund (IMF) has given its approval for the second review of Tanzania’s extended credit facility, paving the way for the immediate disbursement of approximately $150.5 million (TZS 384 billion) in budget support.

This brings the total disbursements to Tanzania under the $1.04 billion loan arrangement, approved last year, to around $455.3 million, as stated by the IMF executive board in a release on Thursday.

The IMF highlighted that Tanzania’s structural reform agenda is making good progress, with all end-June 2023 structural benchmarks being met on schedule, demonstrating the authorities’ dedication to the reform agenda.

The IMF said Tanzania’s economic growth is anticipated to bounce back in 2023 after a slowdown in 2022.

However, both global economic challenges and domestic factors continue to impact the country’s economic recovery.

IMF Deputy Managing Director Bo Li emphasized the importance of structural reforms in fostering inclusive, resilient, and sustainable growth in Tanzania.

Li stressed the significance of ongoing efforts to modernize the monetary policy framework and complete the transition to an interest rate-based monetary policy to bolster the effectiveness of monetary policy.

Tanzania has also been challenged to implement business reforms to concentrate on simplifying bureaucratic procedures, refining the regulatory regime, and improving regulatory transparency.

IMF underscored the central role of implementing and enforcing anti-corruption legislation and strategies in enhancing governance.

Given Tanzania’s high vulnerability to climate change, Li emphasized the necessity for sustained efforts to bolster resilience through mitigation and adaptation policies.