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| President John Magufuli receives a report from the Controller and Auditor General (CAG), Professor Mussa Assad at State House in Dar es Salaam on Tuesday. |
- At 50.9trl/-, it is 33.5 pc against GDP, below international sustainability levels
Tanzania’s national debt which currently stands at 50.9trl/- as of January this year is still maintainable at 33.5 per cent against the country’s Gross Domestic Product (GDP), and remains below international sustainability levels, President John Magufuli, reiterated on Tuesday.
What is more, the Head of State explained further that the country boasts of foreign reserves amounting to 5 billion US dollars, which is sufficient to purchase goods and services for six months, above the convergence criteria agreed in the East African Community (EAC) at 4.5 months.
“Our debt is still sustainable and we can even borrow more for development projects; there are some nations, some of which are branded first world countries, whose national debts are 200 per cent more compared to their GDPs,” Dr Magufuli explained, adding: ” It is not bad to borrow for development projects.
In fact, some of the financial institutions which used to lend us funds at 7 per cent are now settling for less than 3 per cent. Our negotiation muscle has significantly improved.” President Magufuli made the remarks in Dar e Salaam on Tuesday after the Controller and Auditor General (CAG), Prof Mussa Assad, expressed concern over the trend of rising national debt which stood at 46trl/- as of June 30, 2017.
This was during an event at the State House where the CAG presented annual audited reports for central and local governments, public institutions, development projects and special audits for financial year 2016/2017. Dr Magufuli assured the CAG that Tanzania’s debt level was still manageable, meaning that the country could even borrow more from local and international lenders. Available statistics indicate that at the end of the second quarter of last year, the United States of America (USA)’s public debt to - GDP ratio was at 103.8 per cent while the level of public debt in Japan 2013 was 243.2 per cent against the GDP.
The Bretton Woods institute indicated in the report that during the period under review, China was faring well at just 22.4 per cent while in India it was at 66.7 per cent. Others are Germany (89.1 per cent) United Kingdom (98.2 per cent) and France and Italy (135.5 per cent). In a related development, Dr Magufuli asked Chief Justice Prof Ibrahim Juma and Principal Judge Ferdinand Wambali to spearhead the fast-tracking settlement of tax related cases worth about 4.4trl/- which remained unsolved in courts of law.
“This is a lot of money; please chart out a mechanism for speeding up the hearing of the cases so that the government can gain its fair share of revenues. We really need these funds for development projects and settling debts,” he stressed. Dr Magufuli was upbeat that the government was in a position to collect adequate revenues to undertake all development projects which have been earmarked, including the standard gauge railway, Stieglers Gorge hydro power plant and purchasing new planes for Air Tanzania Limited (ATCL).
At the same occasion, the Chairperson of the Parliamentary Public Investment Committee (PIC), Dr Raphael Chegeni, assured President Magufuli that revenues from public entities would hit one trillion shillings this year from 885.5bn/- recorded during the last financial year. Dr Chegeni appealed to the government to appoint executives in some public institutions where most of their officials and board chairpersons were in acting positions and thus unable to make crucial decisions.
What is more, the Head of State explained further that the country boasts of foreign reserves amounting to 5 billion US dollars, which is sufficient to purchase goods and services for six months, above the convergence criteria agreed in the East African Community (EAC) at 4.5 months.
“Our debt is still sustainable and we can even borrow more for development projects; there are some nations, some of which are branded first world countries, whose national debts are 200 per cent more compared to their GDPs,” Dr Magufuli explained, adding: ” It is not bad to borrow for development projects.
In fact, some of the financial institutions which used to lend us funds at 7 per cent are now settling for less than 3 per cent. Our negotiation muscle has significantly improved.” President Magufuli made the remarks in Dar e Salaam on Tuesday after the Controller and Auditor General (CAG), Prof Mussa Assad, expressed concern over the trend of rising national debt which stood at 46trl/- as of June 30, 2017.
This was during an event at the State House where the CAG presented annual audited reports for central and local governments, public institutions, development projects and special audits for financial year 2016/2017. Dr Magufuli assured the CAG that Tanzania’s debt level was still manageable, meaning that the country could even borrow more from local and international lenders. Available statistics indicate that at the end of the second quarter of last year, the United States of America (USA)’s public debt to - GDP ratio was at 103.8 per cent while the level of public debt in Japan 2013 was 243.2 per cent against the GDP.
The Bretton Woods institute indicated in the report that during the period under review, China was faring well at just 22.4 per cent while in India it was at 66.7 per cent. Others are Germany (89.1 per cent) United Kingdom (98.2 per cent) and France and Italy (135.5 per cent). In a related development, Dr Magufuli asked Chief Justice Prof Ibrahim Juma and Principal Judge Ferdinand Wambali to spearhead the fast-tracking settlement of tax related cases worth about 4.4trl/- which remained unsolved in courts of law.
“This is a lot of money; please chart out a mechanism for speeding up the hearing of the cases so that the government can gain its fair share of revenues. We really need these funds for development projects and settling debts,” he stressed. Dr Magufuli was upbeat that the government was in a position to collect adequate revenues to undertake all development projects which have been earmarked, including the standard gauge railway, Stieglers Gorge hydro power plant and purchasing new planes for Air Tanzania Limited (ATCL).
At the same occasion, the Chairperson of the Parliamentary Public Investment Committee (PIC), Dr Raphael Chegeni, assured President Magufuli that revenues from public entities would hit one trillion shillings this year from 885.5bn/- recorded during the last financial year. Dr Chegeni appealed to the government to appoint executives in some public institutions where most of their officials and board chairpersons were in acting positions and thus unable to make crucial decisions.
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