Tanzania’s proposed Sh57.04 trillion budget for 2025/26 has drawn praise and concern from stakeholders over heavy borrowing. The plan prioritizes debt repayments and preparations for elections and AFCON, which may affect development funding. Experts advocate for stringent financial management and a focus on domestic revenue to mitigate borrowing risks.
The Tanzanian government recently unveiled its Sh57.04 trillion budget framework for the 2025/26 financial year, sparking discussions about its heavy reliance on loans for essential expenditures. Key budget priorities include funding for the General Election, debt repayments, and the Africa Cup of Nations (AFCON), which have raised concerns about potential complications in financing development projects.
Acknowledging these financial pressures, the government plans to refrain from launching new projects in the upcoming fiscal year and instead focus on completing existing initiatives to maintain financial discipline. Finance Minister Dr. Mwigulu Nchemba emphasized six main priorities during the budget presentation: settling government debts, paying salaries, preparing for elections and AFCON, and fostering democracy and stability.
According to the budget outline, Sh40.09 trillion (69.7 percent) will be sourced domestically, while Sh16.7 trillion (30.3 percent) is expected from external funding. Economists like Zacharia Jackson have expressed concerns regarding the risk of accumulating more debt due to the substantial funding required for these key priorities, cautioning that mismanagement might hinder developmental funding.
Financial analyst Sablina Kaijage echoed similar sentiments, noting that significant election-related expenditures could detract from ongoing projects. She highlighted the unpredictability of election costs, urging a focus on maximizing domestic revenue and emphasizing the importance of self-sufficiency during election periods.
Additionally, vendors such as Aidan Chedego stressed the importance of timely salary payments to civil servants, linking economic stability to consumer spending. As discussions unfold, experts underscore the need for rigorous financial oversight to navigate upcoming fiscal challenges effectively.
In conclusion, while stakeholders have recognized the importance of Tanzania’s budget proposals, concerns regarding the increasing reliance on borrowing and its implications for development funding persist. The government’s strategy to prioritize ongoing projects and focus on domestic funding is crucial in managing financial stability. Emphasizing financial prudence and efficient allocation of resources is essential for navigating the challenges ahead, ensuring that both economic growth and social stability are sustained.
Original Source: www.thecitizen.co.tz
