For more information, see Tanzania and the IMF

Tanzania—Enhanced Structural Adjustment Facility
Policy Framework Paper for 1998/99–2000/01

Contents

Tables

Table 1.  Tanzania: Recent Policy Performance


Sector Steps Taken Timing

1.  External sector
Trade policy Abolished all trade restrictions except for petroleum products and
goods restricted for health and security reasons
1993
Reduced number of nonzero tariffs from seven to four, and top rate to 30 percent June 1997
Completed preliminary study of further reform of customs tariff structure March 1998
External current payments Removed limits on payments and transfers for current international transactions 1994
Accepted the obligations of Article VIII of the Fund's Articles of Agreement July 1996
International reserves Increased gross international reserves 1995/96-1997/98
External debt Negotiated Paris Club flow rescheduling on Naples terms January 1997
Established multilateral debt fund January 1998
Regional initiatives Endorsed the Common Market for Eastern and Southern Africa (COMESA) 1995

Endorsed the "road map" for external trade liberalization proposed by the Cross-Border Initiative cosponsors, together with 12 other countries from the region March 1995
The East African Monetary Affairs Committee was established March 1998
 
 
2.  Fiscal Policies
Overall Achieved recurrent budget savings above 1 percent of GDP 1996/97-1997/98
Revenue Established the Tanzania Revenue Authority (TRA) July 1996
Revised investment act to eliminate tax holidays 1996/97
Harmonized duties between Zanzibar and mainland Tanzania on five major commodities December 1996
Implemented new preshipment inspection contract, with sealing of containers January 1998
Completed preparation for introduction of value-added tax (VAT) on July 1, 1998 1997/98
Adopted narrow definition of capital goods for customs purposes June 1998
Adopted effective and transparent monitoring system for bonded warehouses June 1998
Expenditure Introduced stringent expenditure control, based on rigorous cash management system From second half
of 1995/96
Fully protected social sectors in implementing cash budget 1997/98
Revitalized development budget, reducing number of projects to a more manageable level 1996/97-1997/98
Established sub-treasuries 1996/97-1997/98
 
3.  Monetary policy and financial reform
Overall Liberalized interest rates and established competitive treasury bill auctions 1993
Reduced rate of monetary expansion 1996/97-1997/98
Banking Began licensing private banks 1993/94
Split National Bank of Commerce (NBC) into NBC (1997) and National Microfinance Bank (NMB) October 1997
Issued invitation to bid on management contract for NMB May 1998
Insurance Implemented insurance sector liberalization May 1998
Capital markets Operationalized Dar es Salaam Stock Exchange April 1998
 
4.  Public sector reform
Civil service reform Reduced employment by 77,000, including removal of "ghost workers" from payroll, reducing the workforce to 273,000 1993-96; ongoing
Introduced a pay reform program to reduce the number of salary scales and include most allowances in the basic wage, and monetized most in-kind benefits June 1996
Restructured regional administration 1997/98
Parastatal reform Removed more than half of parastatals from government control 1994-98
 
5.  Sector policies
Investment policy Adopted new investment code August 1997
Power Set up a system of direct payment to electricity parastatal Tanzania Electric Supply Company Ltd. (TANESCO) from Ministry of Finance to cover bills for customers TANESCO is not allowed to disconnect September 1997
Petroleum Abolished monopoly on refined petroleum product imports April 1997
Assigned collection of petroleum funds to TRA 1997/98
Mining Revised legal framework and enacted new mining legislation 1997/98
Land policy Adopted a new land policy to improve security of tenure and allocation of land February 1995
Agriculture Opened marketing and processing of traditional export crops to the private sector through legislation and accompanying regulations 1994
Adopted agriculture and livestock policy, as well as cooperative development policy 1997
Water Set up semiautonomous water boards in regional headquarters 1997/98
Reviewed rural water policy 1997/98
Roads Completed study on institutional arrangements for road management March 1998
 
6.  Social sectors
Poverty reduction Initiated implementation of National Poverty Eradication Strategy June 1998
Education Approved a new education and training policy June 1995
Adopted Basic Education Master Plan February 1997
Completed studies on issues in secondary education June 1998
Health Approved a proposal for health sector reform March 1995
Introduced cost sharing at primary care facilities in nine districts 1997/98
Environment Adopted national environmental policy November 1997
Endorsed the National Conservation Strategy for Sustainable Development 1996

 
7.  Statistics Published revised national accounts May 1997
Began publication of balance of payments data on basis of Balance of Payments Manual (5th ed.). December 1997
Began monthly publication of trade statistics based on customs data January 1998

Table 2.  Tanzania: Policy Matrix, 1998/99-2000/01


Sector Objectives and Targets Strategies and Measures Timing

1.  External sector policies
Overall Achieve benefits of international integration and reduce aid dependency Continue financial and economic reforms and liberalization Continuous
Maintain flexible exchange rate Continuous
Tariff reform Simplify tariff structure and reduce protection Complete a follow-up study of the customs tariff structure October 1998
Reduce import duties in line with Cross-Border Initiative (CBI) undertakings and reduce statutory exemptions to a minimum July 1999
Regional integration Enlarge markets and enhance cooperation Reinstate most Common Market for Eastern and Southern Africa (COMESA) preferences July 1998
Reduce tariff and nontariff barriers within East African Cooperation 1998-2001
Follow policies set out in CBI policy letter Continuous
Export development Promote export growth Eliminate export duty on traditional exports July 1998
Capital controls Enhance efficiency of capital markets and promote capital inflows Review capital controls with a view to their eventual elimination with appropriate safeguards Continuous
Foreign reserves Promote external stability Increase gross reserves to the level of four months of imports of goods and nonfactor services June 2000
External debt Reduce external debt service to sustainable level Maintain multilateral debt fund Continuous
Study case for Heavily Indebted Poor Country (HIPC) debt relief 1998/99
Avoid nonconcessional borrowing by public sector Continuous
Normalize relations with external creditors Complete commercial debt buyback February 1999
Negotiate stock-of-debt Paris Club rescheduling 1999/2000
Observe revised debt-service schedules Continuous
2.  Fiscal policies
Overall Achieve and maintain fiscal stability and increase domestic savings Maintain recurrent budget savings above 1 percent of GDP Continuous
Revenue Broaden revenue base and improve efficiency Introduce value-added tax (VAT) and make complementary changes to the tax system July 1998
Introduce VAT in Zanzibar with the same rate and coverage as on the mainland January 1999
Limit exemptions on capital goods under the investment act using the harmonized tariff system, with a view to ensuring that investment incentives do not undermine revenue collection July 1998
Strengthen customs administration and continue implementation of the customs reform program Continuous
Introduce pre-shipment inspection (PSI) for private sector imports to Zanzibar January 1999
Establish a harmonized tax appeals mechanism 1998/99
Reduce customs exemptions in conjunction with revision of tariff structure (see under "Tariff reform" above) July 1999
Further simplify and rationalize the tax system July 1999
Expenditure control Limit expenditures to maintain
fiscal stability
Strengthen subtreasury system 1998/99
Institute comprehensive personnel database December 1998
Install new payroll system July 1999
Complete reviews of transfers to public institutions December 1998
Protect expenditure on social services in administering the cash management system Continuous
Introduce an expenditure commitment monitoring system in ten key ministries to run in parallel with the cash management system July 1998
Extend the expenditure commitment monitoring system to all ministries July 1999
Strengthen the system for monitoring overall public debt 1998/99
Conduct public expenditure review Annually
Development expenditure management Reallocate resources to reflect changing roles of government in economic management and improve accounting and efficiency of public expenditures Prioritize development expenditures among and within sectors and ensure their consistency with the medium-term expenditure framework (MTEF) Continuous
Achieve full budgeting and accounting coverage of donor-financed government expenditures in collaboration with donors in the context of the public expenditure review 1999/2000
Integrate fully the recurrent and development budgets to take into account sector priorities and recurrent cost implications 2000/01
Intergovernmental relations Regularize financial relations between Zanzibar and mainland Tanzania Move all government of Zanzibar accounts from People's Bank of Zanzibar (PBZ) to Bank of Tanzania (BoT) 1998/99
Make Joint Finance Commission operational 1998/99
Local government finances Ensure viability of local government finances Revise legal framework for grants, revenues, and negotiation mechanism for sharing of revenue and sources of revenue between central and local government February 1999
Ensure agricultural taxation consistency Review local taxes and levies on the agriculture sector, and implement key recommendations June 1999
3.  Monetary policy and financial reform
Overall Reduce inflation, increase domestic resource mobilization, and improve allocation of financial resources Maintain market-oriented policies of monetary restraint Continuous
Promote and sustain positive real interest rates Continuous
Inflation Reduce inflation rate to 4 percent by 2000/01 Maintain low rates of monetary expansion Annual targets
Limit bank financing of the budget Continuous
Financial markets Deepen markets Introduce primary dealer system and institute book-entry system December 1998
Promote private sector establishment of a credit information bureau by 1999/2000 1998/99
Financial institutions Improve efficiency of financial intermediation and stem losses Issue National Bank of Commerce (NBC) (1997) and National Microfinance Bank (NMB) investment memoranda July 1998
Evaluate bids for NBC (1997) and NMB February 1999
Ensure NBC (1997) and NMB comply with memoranda of understanding until they are in compliance with regulatory standards Continuous
Complete study of options for restructuring and privatizing PBZ March 1999
Restructure PBZ June 1999
Operationalize commercial courts July 1999
Revise the Banking and Financial Institutions Act to institute legal framework for regulation and supervision of microfinance institutions 1998/99
Strengthen banking supervision Continuous
4.  Public sector reform
Civil service reform Establish efficient and motivated civil service and improve quality and effectiveness of delivery of public services Prepare recommendations on the affordable size of the civil service, consistent with the MTEF pay targets and efficiency Annually from
December 1998
Improve performance Compile ministerial performance objectives and targets, and details of administrative and technical support requirements
•  Pilot phase: three ministries
•  Second phase: six ministries
•  All ministries
July 1999
December 1999
December 2001
Establish performance improvement fund July 1999
Reform civil service pay structure Continue rationalization of civil service pay structure with a view to its enhancement Continuous
Restructure and promote private sector participation Rationalize civil service employment based on needs for quality, service delivery, efficiency reviews, and wage bill targets Continuous
Expand contracting out of noncore functions March 1999
Complete implementation of "quick wins" service improvements July 1999
Launch six new executive agencies July 1999
Commence privatization of low-priority functions March 1999
Complete assessment of the adequacy and distribution of staff in hospitals and local authorities February 1999
Reallocate surplus staff at hospitals and local authorities April 1999
Implement management information systems Establish and maintain a central personnel database June 1999
Install new payroll system December 1999
Complete all key computer interventions to address Y2K risk October 1999
Strengthen leadership, management, and governance Establish new Public Service Commission with sufficient powers and resources to ensure increased transparency in appointments and promotions December 1999
Restructure civil service training institutions into a public service college 1999/2000
Coordinate, monitor, and evaluate policies Complete job evaluation program, with the aim of rationalizing the pay structure for professional and technical staff June 1999
Local government reform Improve the quality of, and access to, public services provided through or facilitated by local government authorities Clarify roles and responsibilities of the Ministry of Regional Administration and Local Government and key sectoral ministries for the disbursement of district block grants
Implement the local government reform program:
•  Phase 1
•  Phase 2
•  Phase 3
January 1999
January 2000
January 2001
Amend existing legislation to support the effective implementation of the program January 1999
Adopt plan for strengthening capacity in the 35 local authorities January 1999
Adopt transparent systems for disbursement and accounting for the block grants January 1999
Adopt a system for ensuring consistency between district programs and sector-wide/national policy priorities February 1999
Parastatal policy Improve efficiency and reduce fiscal and monetary pressures Remove public enterprise (PE) units from government control through sales, lease, liquidations, and divestitures of 50 additional PEs 1998/99-2000/01
Complete divestiture of PEs 2000/2001
Bring to point of sale Tanzania Telecommunications Company Ltd. May 1999
Remove monopoly of National Shipping Agencies Corporation (NASACO) (amend act to open entry) April 1999
Deregulate Tanzania Central Freight Bureau (amend 1981 act to remove exclusive authority to negotiate rates and allocate cargo) March 1999
Review regulatory framework for utilities and infrastructure October 1998
Finalize study on PE retrenchment compensation packages March 1999
Adopt comprehensive policy on PE retrenchment compensation April 1999
Finalize study on PE debt December 1998
Adopt comprehensive policy on PE debt treatment April 1999
Complete economic impact study of privatization program December 1998
5.  Sector policies
Investment policy and private sector development Promote efficient private sector investment by providing a level playing field with limited tax incentives Review operations of the Tanzania Investment Centre (TIC) and prepare a strategy to ensure its efficient operation, emphasizing a shift from regulatory functions to promotional activities, in collaboration with the private sector June 1999
Streamline regulatory environment and ensure effective application of the private sector investment code Continuous
Power sector Satisfy the economy's needs
for electrical power in an
efficient and environmentally
sound manner
Charge economic tariffs and strengthen revenue collection by electricity parastatal Tanzania Electric Supply Company Ltd. (TANESCO) Continuous
Develop a power sector regulatory policy and plan, and have it approved by government June 1999
Revise legislation and prepare regulatory framework for the power sector March 2000
Restructure power sector Adopt power sector restructuring strategy December 1999
Petroleum Enhance the capacity and efficiency of the petroleum industry, increase private sector participation in the sector, and encourage oil and gas exploration Institute automatic increases in petroleum product price ceilings when import costs increase November 1998
Complete draft of regulatory framework February 1999
Establish regulatory framework June 1999
Complete liberalization of retail prices February 1999
Decide on Tanzanian-Italian Petroleum Refinery (TIPER) strategy, based on recommended options from the TIPER study February 1999
Divest TIPER 1999/2000
Complete liberalization of petroleum products imports November 1999
Mining Establish framework for development by private sector Divest public mining companies 1999/2000
Review and decide on the future role of the State Mining Corporation (STAMICO) 1998/99
    Reorganize STAMICO June 2000
Land and human settlement Improve service delivery and allocation of land and encourage greater private sector involvement
in the provision of housing
Enact a new land policy law 1998/99
Revise policy and development strategy for human settlement development 1999/2000
Establish modalities for assigning value to land (land valuation manual) 1999/2000
Improve information flows through an appropriate information system Establish a data unit with networks 2000/01
Agriculture Ensure basic food security and develop a sustainable agriculture and livestock production Evaluate the effectiveness of the Strategic Grain Reserve (SGR), including alternative options for providing food security and disaster relief 1998/99
Support private sector role in agriculture and livestock 1998/99
Devolve extension services to local government and integrate with agricultural research 1999/2000
Evaluate strategies for technology development and dissemination to improve smallholder productivity, access to credit, and rural infrastructure 1998/99
Improve the regulatory framework for production, marketing, and processing of agricultural products Complete study of the need for regulatory institutions, such as commodity boards February 1999
Act on study findings June 1999
Remove restrictions on internal flows of agricultural commodities 1998/99
Encourage and support private sector participation Complete the divestiture and hiving off of the remaining agricultural parastatals and selected public sector activities 2000/01
Transfer research activities to the appropriate industry groups:
•  cotton, cashew, and sugar
•  tobacco, sisal, coffee, and pyrethrum
June 1999
December 1999
Water Ensure adequate water supply Complete review of water policy 1998/99
Develop regulatory framework for urban water supply and sewerage services June 1999
Consolidate the urban water and sewerage authorities 1999/2000
Restructure urban water supply pricing policy to address economic, financial, and equity objectives 1999 onward
Transfer management of existing rural water system infrastructure to local communities and introduce a water fund, managed by local authorities Continuous
Support "Water for Life" campaign Continuous
Roads Ensure effective and efficient management of the country's road network Establish an autonomous road agency to be staffed by personnel engaged on performance-contract basis March 1999
Put in place legislation for the road fund such that at least 90 percent of the fund is dedicated to maintenance December 1998
Railways Concession Tanzania Railways Corporation June 2000
Transfer assets to the newly established Marine Services Company December 1998
Issue information memorandum for Marine Services Company May 1999
Ports Mobilize consultants to assist Tanzania Harbour Authority (THA) in preparing bidding documents for the container terminal concession September 1998
Complete concessioning of the Dar es Salaam container terminal June 1999
Develop a plan for the remaining operations of THA 1999/2000
6.  Social sector policies, poverty reduction, and environmental protection
Poverty Reduce poverty Finalize and initiate implementation of National Poverty Eradication Strategy (NPES) December 1998
Institutionalize poverty monitoring system to assess impact of policies on poverty December 1998
Establish a poverty data bank March 1999
Finalize implementation guidelines for the NPES June 1999
Education Improve access to, quality, and cost-effectiveness of basic education Maintain basic education recurrent spending share at 65 percent minimum from FY 1998/99 onward and increase nonsalary spending per student by 0.5 percent annually July 1998 onward
Begin implementing Basic Education Master Plan (BEMP) 1998/99
Design priority programs for facilities, textbooks, school management and teacher rationalization, adult and complementary studies, inspectorate and TTC audit, and rationalization August 1998
Implement action plan for decentralization of education financing and management in 35 phase 1 local authorities January 1999
Adopt action plan for management and monitoring system March 1999
Undertake annual joint government/donor review to monitor progress in sector development, including basic education July 1999, 2000, and 2001
Improve secondary education, including broadened public-private partnership Complete Secondary Education Master Plan (SEMP) and adopt a framework for cost sharing among government, private sector, and local communities December 1998
Begin implementing SEMP 1999/2000
Rationalize postsecondary education Adopt action plan for the reform of technical and higher education, including management and financing reforms November 1998
Health Improve health outcomes by increasing level and improving allocation of resources for basic health care Complete compilation of the national health accounts and develop a public sector resource envelope for the health sector, including all donor resources, within the MTEF July 1999
Set targets for intrasectoral allocations of resources, with priority to basic health services and nonsalary items December 1999
Introduce revolving drug funds at pilot hospitals to ensure sustainable financing of pharmaceuticals January 1999
Review and improve efficiency of revenue collection for hospital services Continuous
Extend cost-sharing to dispensaries and health centers Continuous
Develop legislation and regulations for health insurance for public servants July 1999
Implement action plan for malaria control 1998/99
Raise public awareness of HIV/AIDS epidemic as a national development issue and strengthen political commitment to fighting it December 1998 onward
Environment Conserve natural resources for sustainable growth Prepare an environmental management framework for the mining sector February 1999
Complete an assessment of the institutional options for improving environmental management March 1999
Prepare a biodiversity conservation strategy and action plan July 1999
Adopt a national action plan to combat desertification December 1999
Present environmental framework legislation to Parliament 1999/2000
7.  Statistics Improve economic statistics for better monitoring and analysis of development Strengthen and computerize the national accounts compilation system Continuous
Begin publishing semiannual national accounts January 1999
Revise the consumer price index (CPI) basket on the basis of a new household budget survey 1999/2000
Complete the review of the statistical system in preparation for participation in the General Data Dissemination System (GDDS) June 1999
Appoint a coordinator for the GDDS November 1998

Table 3.  Tanzania: Selected Economic and Financial Indicators, 1994/95 2000/011


        1997/98

1998/99 1999/00 2000/01
  1994/95 1995/96 1996/97 Prog.2 Est. Prog.   Proj.   Proj.  

(Change in percent, unless otherwise indicated)
GDP and prices            
   Nominal GDP (in billions of
      Tanzania shillings;
      calendar year)
2,298.9 3,020.5 3,767.6 . . . 4,703.5 5,395.7 6,063.3 6,736.5
   Real GDP (calendar year) 1.6 3.6 4.5 . . . 3.5 3.3 5.2 5.9
   Nominal GDP (in billions of
   Tanzania shillings)3
2,659.7 3,394.1 4,235.6 4,679.2 5,049.6 5,729.5 6,399.9 7,088.7
   Real GDP3 2.6 4.1 4.0 6.0 3.4 4.3 5.6 6.1
   Real GDP per capita -0.3 1.2 1.0 3.2 0.6 1.5 2.8 3.3
   Consumer price index                
      Annual average 29.1 24.7 16.7 13.0 14.8 10.1 6.1 4.4
      End of period 26.7 22.8 16.4 9.5 12.0 7.5 5.0 4.0
                 
External sector                
   Exports, f.o.b.
      (in millions of U.S. dollars)
592.9 695.9 793.6 844.9 644.9 673.7 805.2 893.6
   Imports, c.i.f.
      (in millions of U.S. dollars)
-1,509.7 -1,370.3 -1,387.8 -1,671.8 -1,401.6 -1,510.0 -1,690.1 -1,892.5
   Export volume -2.7 24.9 18.8 8.0 -24.6 6.7 20.3 10.6
   Import volume -13.7 -9.8 4.3 18.4 10.6 10.0 10.8 10.8
   Terms of trade 24.3 -6.7 -1.1 -3.9 15.6 -0.1 2.0 -0.6
   Nominal effective exchange
      rate (end of period)
-20.1 2.7 -0.7 . . . 0.3 . . . . . . . . .
   Real effective exchange rate
      (end of period)
-3.8 22.2 13.3 . . . 10.8 . . . . . . . . .
                 
Public finance                
   Revenue (excluding grants) 36.6 35.4 27.6 17.4 8.2 19.8 15.7 10.9
   Total expenditure and
         net lending
. . . 22.2 7.2 30.4 19.8 23.5 10.7 7.3
      Current expenditure 41.5 18.1 11.3 17.2 7.5 19.8 10.4 5.9
      Capital expenditure and
         net lending
. . . 41.2 -9.1 93.8 78.9 34.0 11.3 10.8
                 
  (In percent of beginning-period broad money,
unless otherwise indicated)
Money and credit                
   Broad money 36.6 16.6 18.2 10.4 7.7 12.4 . . . . . .
   Net foreign assets 12.7 10.4 22.5 5.3 4.2 5.8 . . . . . .
   Net domestic assets4 21.3 6.9 -0.7 5.2 6.0 7.5 . . . . . .
      Credit to government (net) 12.2 14.7 -2.5 -5.8 -5.4 9.4 . . . . . .
      Credit  to the nongovernment
         sector4
0.5 -20.8 0.1 8.0 7.8 12.7 . . . . . .
   Velocity (fiscal-year GDP/
      end-period broad money)
4.1 4.6 4.8 5.2 5.3 5.4 . . . . . .
   Treasury bill interest rate
      (in percent; end of period)5
38.6 17.0 7.0 . . . 12.4 . . . . . . . . .
                 
  (In percent of GDP, unless otherwise indicated)
Public finance                
   Domestic revenue
      (excluding grants)
12.5 13.2 13.5 13.3 12.2 12.9 13.4 13.4
   Total grants 2.0 2.2 3.6 3.7 3.1 4.4 3.9 3.6
   Expenditure 18.3 17.6 15.1 16.5 15.2 16.5 16.3 15.8
   Recurrent savings
      (checks issued)
-2.7 -0.8 1.0 1.0 1.0 1.1 1.7 2.2
   Overall balance (including
      grants; checks cleared)
-5.0 -3.0 1.9 0.5 0.2 0.9 0.9 1.2
   Primary balance (excluding
      grants; checks cleared)
-3.6 -1.8 0.9 -0.8 -0.6 -1.6 -1.0 -0.8
                 
Savings and investment                
   Gross domestic savings 4.0 3.8 9.0 9.6 7.0 7.2 7.8 8.4
      Government -2.7 -0.8 1.0 1.0 1.0 1.1 1.7 2.2
      Nongovernment 6.7 4.6 7.9 8.6 6.0 6.1 6.2 6.2
   Investment 21.7 17.9 18.9 21.7 18.6 19.5 21.0 22.3
   Government 3.2 3.6 2.6 4.2 3.9 4.6 4.6 4.6
      Nongovernment 18.5 14.3 16.3 17.5 14.7 14.9 16.4 17.7
   Resource balance -17.7 -14.1 -9.9 -12.1 -11.6 -12.3 -13.2 -13.9
                 
External sector, public debt,
      and debt service
               
   Current acount balance
      (excluding grants)
-21.1 -16.2 -12.0 -14.3 -14.2 -14.1 -14.2 -14.5
   Current acount balance
      (including grants)
-10.5 -6.2 -2.2 -4.9 -5.7 -5.5 -6.3 -7.0
   External debt service,
      including IMF (in percent
      of exports of goods and
      nonfactor services)
43.5 44.6 36.9 22.6 36.4 33.6 31.3 28.3
                 
  (In millions of U.S. dollars, unless otherwise indicated)
               
Current account balance
   (excluding grants; deficit -)
-1,047.0 -941.9 -842.0 -1,072.4 -1,119.6 -1,181.7 -1,267.5 -1,398.6
Overall balance of payment
   (deficit -)
-222.8 -169.3 19.3 -36.1 -132.7 -44.2 -129.3 -201.9
Gross official reserves 255.1 240.1 460.5 591.7 502.5 678.4 812.9 910.6
   In months of imports of goods
      and nonfactor services
1.6 1.5 2.8 2.9 3.0 3.7 4.0 4.0

Sources: Tanzanian authorities; and Fund staff estimates and projections.
1Fiscal years run from July through June. All data in the table are on a fiscal-year basis, unless otherwise mentioned; calendar-year data cover the period ending at the middle of the fiscal year.
2See EBS/97/209 (11/19/97). The 1997/98 ratios relative to GDP are based on estimated GDP.
3National accounts in Tanzania are compiled on a calendar-year basis. Fiscal-year GDP data are derived as a simple average of two calendar years.
4The 1995/96 decline reflects loan write-offs of T Sh 112 billion by the National Bank of Commerce and the Cooperative and Rural Development Bank.
5Weighted average yield of 91-, 182-, and 364-day treasury bills.

Table 4.  Tanzania: Income and Social Indicators


  Latest Single Year

Same Region/
Income Group

  1970–75 1980–85 1990–96 Sub-  
Saharan
Africa  
Low-  
income  
countries

Population          
   Total population, midyear (millions) 15.9 21.8 30.5 . . . . . .
      Growth rate (percent annual average) 3.1 3.2 2.8 2.8 1.6
   Urban population (percent of population) 10.1 17.6 24.9 31.1 28.6
   Total fertility rate (births per woman) 6.8 6.7 5.6 5.7 3.2
   Agriculture (percent of labor force) 88.0 85.0 84.0 65.0 67.0
           
Income/consumption distribution          
   Share of income or consumption
      (in percent of income or consumption)
         
   Lowest quintile 5.0 . . . 6.9 . . . . . .
   Highest quintile 53.0 . . . 45.4 . . . . . .
           
Poverty indicators          
   Percent of population below poverty line . . . 64.6 50.5 . . . . . .
   Depth1 . . . 35.8 34.2 . . . . . .
   Total poverty gap (billions of U.S. dollars) . . . 1.21 0.31 . . . . . .
           
Social indicators          
           
Public expenditure (in percent of GDP)          
      Health . . . . . . 2.4 . . . . . .
      Education . . . 3.4 3.6 . . . . . .
           
Gross primary school enrollment rate
      (in percent of age group)
         
   Total 53 75 70 71 105
      Male 62 76 71 77 112
      Female 44 74 69 64 98
               
Access to health care (persons)          
   Population per physician 22,540 28,271 . . . . . . . . .
   Population per nurse 3,403 7,988 . . . . . . . . .
   Population per hospital bed . . . 768 981 1,316 1,034
           
Access to safe water
      (in percent of population)
         
   Total 39.0 . . . 49.0 47.0 53.0
         Urban . . . . . . 65.0 . . . . . .
         Rural 36.0 . . . 45.0 . . . . . .
           
Immunization rate
      (in percent under 12 months)
         
   Measles . . . 66 75 60 77
   Diphtheria . . . 67 79 58 80
           
Child malnutrition (percent under 5 years) . . . . . . 28 . . . 42
           
Life expectancy at birth (in years)          
   Total 46 51 51 52 63
      Male 45 . . . 49 51 62
       Female 48 . . . 52 54 64
           
Mortality          
   Infant (per thousand live births) 125 98 86 92 69
   Under 5 (per thousand live births) . . . . . . 144 157 104
   Adult (15-59) . . . . . .      
      Male (per 1,000 population) . . . . . . 485 433 244
      Female (per 1,000 population) . . . . . . 417 359 211
      Maternal (per 100,000 live births) . . . . . . 748 . . . . . .

Source: World Bank, World Development Indicators, February 1997.
1Percent of poverty line income required to bring everyone below the poverty line up to it.

Table 5.  Tanzania: External Financing Requirements and Sources, 1995/96–2000/011
(In millions of U.S. dollars)


  1995/96 1996/97 1997/98 1998/99 1999/00 2000/01
 
Est.

Proj.

Current account -941.9 -842.0 -1,119.6 -1,181.7 -1,267.5 -1,398.6
   Exports of goods and nonfactor
      services
1,167.9 1,313.2 1,107.1 1,171.8 1,350.0 1,489.6
   Imports of goods and nonfactor
      services
-1,986.0 -2,040.2 -2,016.1 -2,202.5 -2,438.8 -2,701.9
   Private transfers (net) 19.9 25.7 30.0 30.7 31.3 32.0
             
   Noninterest current account
      (excluding official transfers)
-798.3 -701.3 -1,305.0 -1,323.5 -1,428.4 -1,557.6
             
   Scheduled interest -143.6 -140.8 -185.4 -141.8 -160.9 -159.0
             
Capital account -113.2 -186.0 -105.5 -65.5 -50.1 -20.2
   Scheduled amortization -354.4 -317.0 -217.9 -251.7 -262.1 -262.2
   IMF repayments -22.2 -24.2 -36.0 -33.0 -29.1 -23.3
   Other capital2 263.5 155.2 148.4 219.2 241.1 265.2
             
Increase in net official reserves (-) -58.5 -320.6 -13.2 -175.9 -134.5 -97.6
             
Changes in arrears (decrease -) 250.0 -1,025.2 79.1 -1,742.3 0.0 0.0
             
External financing requirements 863.6 2,373.8 1,159.1 3,165.4 1,452.1 1,516.5
             
Disbursements 863.6 1,095.9 1,104.8 1,269.9 1,159.1 1,193.6
   Official transfers 581.4 689.9 668.7 722.3 706.2 719.5
   Loans 282.2 333.3 387.7 447.8 452.9 474.1
      IDA 166.9 135.7 191.0 219.9 76.3 38.7
      African Development Fund 32.2 26.5 57.8 71.1 21.2 13.4
      Official bilateral creditors 83.1 171.1 138.9 . . . . . . . . .
   IMF 0.0 72.7 48.4 126.5 . . . . . .
             
Debt relief and rescheduling3 0.0 1,277.9 54.3 657.3 36.3 . . .
             
Residual financing gap4 0.0 0.0 0.0 1,211.4 256.7 322.9

Sources: Tanzanian authorities; the World Bank's Debtor Reporting System (DRS); and Fund staff estimates and projections.
1Fiscal years run from July through June.
2Including foreign direct investment, short-term capital, and errors and omissions.
3Estimated debt relief from Paris Club creditors on the January 1997 rescheduling agreement and an assumed implementation of a bilateral agreement with Russia, involving an up-front discount of 80 percent on all Russian claims and a flow rescheduling on Naples terms.
4Could largely be filled by debt relief from nonžParis Club bilateral and commercial creditors on terms comparable to those granted by the Paris Club, including a debt buyback operation with commercial creditors.

Table 6.  Tanzania: Service on Public and Publicly Guaranteed
External Debt and Indicators,1996/97–2015/161

(In millions of U.S. dollars, unless otherwise indicated)


  1996/97 1997/98 1998/99 1999/00 2000/01 2001/02 2005/06 2010/11 2015/16 1996/97–
2005/06
2006/07–
2015/16
 
Est.

Prog.

Avg.

Total debt service, before rescheduling 316.3 322.1 341.5 341.1 322.0 274.8 327.2 373.8 478.8 311.1 390.1
   Principal 219.3 203.8 221.5 216.8 196.5 150.2 196.3 216.6 296.2 189.5 230.9
   Interest 96.9 118.2 120.0 124.3 125.5 124.6 131.0 157.2 182.6 121.6 159.2
                       
Debt service on existing disbursed debt 316.3 318.7 334.5 330.1 307.1 255.6 250.3 238.6 217.6 284.3 231.5
   Principal (medium- and long-term debt) 219.3 203.8 221.5 216.8 196.5 150.2 158.6 151.1 139.6 180.8 146.0
      Multilateral2 86.2 97.0 94.7 93.0 92.1 95.9 128.5 120.8 96.6 102.2 113.9
      Official bilateral debt 117.8 89.8 112.6 111.2 94.5 45.5 30.1 30.3 42.9 59.0 32.2
         Paris Club 117.8 79.8 105.0 103.2 86.2 37.9 22.8 25.8 39.5 51.8 27.6
            Post-cutoff-date debt . . . 0.0 0.6 4.6 4.3 4.3 4.3 4.3 4.3 3.1 4.3
            Pre-cutoff-date debt . . . 70.4 99.4 98.3 81.9 33.6 18.5 21.5 35.2 47.2 23.3
               PRD on Toronto terms . . . 66.4 82.6 82.6 81.9 32.5 13.3 5.4 0.0 42.3 5.3
               PRD on London terms . . . 4.0 16.7 15.6 0.0 1.1 5.2 16.1 35.2 5.0 17.9
            Russia . . . 9.3 5.0 0.4 0.0 0.0 0.0 0.0 0.0 1.5 0.0
         Other official debt . . . 10.1 7.6 7.9 8.4 7.6 7.3 4.5 3.4 7.1 4.6
      Commercial debt3 15.3 17.0 14.3 12.6 9.8 8.8 . . . . . . . . . . . . . . .
                       
   Interest (medium- and long-term debt) 96.9 114.8 113.0 113.3 110.6 105.3 91.7 87.5 78.0 103.5 85.5
      Multilateral2 37.7 30.5 28.2 26.6 25.3 24.5 16.7 14.2 9.0 24.9 12.8
      Official bilateral debt 55.2 81.0 82.3 85.0 84.2 79.4 75.0 73.3 69.0 71.6 72.7
         Paris Club 55.2 61.5 59.2 61.0 60.0 55.4 50.6 46.4 38.8 50.5 45.3
            Post-cutoff-date debt . . . 1.2 1.2 1.2 1.2 1.1 0.8 0.5 0.2 1.0 0.5
            Pre-cutoff-date debt . . . 41.7 39.1 40.4 38.9 33.8 26.6 19.1 7.6 31.0 17.6
               PRD on Toronto terms . . . 23.4 20.9 18.4 15.1 10.0 4.1 1.3 0.0 11.1 1.3
               PRD on London terms . . . 18.3 18.2 22.0 23.9 23.8 22.5 17.7 7.6 19.9 16.3
            Russia . . . 18.7 18.9 19.3 19.9 20.5 23.1 26.8 31.0 18.6 27.3
         Other official debt . . . 19.5 23.2 24.0 24.2 24.0 24.4 26.9 30.1 21.1 27.3
      Commercial debt3 4.1 3.4 2.5 1.7 1.0 1.5 . . . . . . . . . . . . . . .
                       
Debt service on new financing4 . . . 3.4 7.0 11.0 14.9 19.2 76.9 135.2 261.2 26.8 158.6
   Principal . . . 0.0 0.0 0.0 0.0 0.0 37.6 65.5 156.6 8.7 84.9
   Interest . . . 3.4 7.0 11.0 14.9 19.2 39.3 69.7 104.6 18.1 73.7
                       
Memorandum items:                      
Total public debt service 316.3 322.1 341.5 341.1 322.0 274.8 327.2 373.8 478.8 311.1 390.1
   (in percent of exports of goods and
      nonfactor services)
25.2 29.1 29.1 25.3 21.6 16.9 12.8 9.4 7.7 17.3 9.1
Total public debt service, after full relief5,6 316.3 250.2 252.5 247.4 209.9 234.7 297.0 355.6 476.9 260.2 374.0
   (in percent of exports of goods and
      nonfactor services)
25.2 22.6 21.6 18.3 14.1 14.5 11.6 8.9 7.7 15.2 8.9
Total debt stock, after full relief2,5 7,758.5 7,370.9 7,710.2 7,190.7 7,598.3 8,041.5 10,023.5 12,970.9 16,145.7 8,278.9 13,314.6
   (in percent of GDP) 110.9 93.7 98.4 84.7 82.5 80.6 72.8 63.0 52.4 86.4 61.8
   (in percent of exports of goods and
      nonfactor services)
618.3 665.8 658.0 532.6 510.1 495.7 391.1 324.9 259.5 473.7 318.2
NPV of total debt stock, after full relief5,6 3,596.7 3,499.2 3,545.5 3,204.4 3,348.3 3,496.0 4,264.6 5,318.9 6,318.1 3,652.3 5,428.1
   (in percent of exports of goods and
      nonfactor services)
286.6 316.1 302.6 237.4 224.8 215.5 180.1 133.2 101.5 210.7 130.9
GDP 6,995.2 7,866.6 8,442.9 8,493.8 9,206.0 9,977.9 13,769.1 20,594.0 30,801.8 9,872.4 22,017.9
Exports of goods and nonfactor services 1,254.8 1,107.1 1,171.8 1,350.0 1,489.6 1,622.1 2,306.7 3,591.5 5,599.2 1,675.9 3,852.1

Sources: World Bank's Debtor Reporting System (DRS); Paris Club data; and Fund staff estimates and projections.
Note: PRD= previously rescheduled debt.
1Fiscal years run from July to June.
2Including IMF.
3Includes debt to suppliers and financial institutions, as identified.
4Includes expected new borrowing from multilateral institutions (including IMF) and residual gap financing assumed on terms comparable to those of concessional multilateral lenders (IDA terms).
5After Paris Club agreement on a flow rescheduling on Naples terms, including Russia, through 1997-99, followed by a hypothetical stock-of-debt operation on Naples terms at end-1999 and comparable action from nonžParis Club bilateral creditors, including a fully donor-financed buyback operation of all identified debts to commercial creditors, assumed to become effective at end-1997/98.
6Calculated on the basis of the World Bank's DRS and Paris Club sources, using a 7 percent discount rate (6 percent for multilateral debt); data in U.S. dollars terms.
7Actual payments to be made, after full rescheduling, as per footnote 5.
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