• Tanzania has sustained relatively high economic growth over the last decade, averaging 6–7% a year. While the poverty rate in the country has declined, the absolute number of poor citizens has not because of the high population growth rate. The country's overall population is about 55 million (2016).  

    Political Context

    In October 2015, John Pombe Magufuli was elected the fifth president of the United Republic of Tanzania. Magufuli’s Fifth-Phase Government has prioritized efforts to clampdown on corruption, improve public administration and manage public resources for improved social outcomes. In 2017, 72% of Tanzanians said corruption had decreased “somewhat” or “a lot” over the preceding year, compared to 13% in 2014. Similarly, 71% said the government is fighting corruption “fairly well” or “very well,” compared to 37% in 2014.

    Economic Overview

    Economic performance in 2018 was mixed, while inflation remains low and stable. The National Bureau of Statistics did not release any quarterly gross domestic product (GDP) data for 2018, pending completion of a rebasing exercise. However, available data suggest signs of softening of the growth momentum. Foreign direct investment has declined from high levels five years ago (about 5% of GDP in 2014), and export growth has stagnated. The current account deficit has increased to 4.4% of GDP in the year ending in December 2018, from 2.9% in the preceding 12 months. Non-performing loans have declined recently to 9.7% in September 2018 from 12.5% in September 2017 but remain almost double the 5% statutory threshold. On the positive side, inflation has remained low and stable at 3% in January 2019. Credit to the private sector has edged upward, reaching 4.9% in the 12 months ending September 2018. Gross official reserves remain high at $5 billion in December 2018, equivalent to 4.9 months of projected import of goods and services, and the shilling has remained relatively stable.

    The fiscal deficit remains low, not counting payment arrears and delayed refunds of value-added tax. The 2017/18 budget deficit after grants of 1.3% of GDP suggests effective spending management but does not factor in payment arrears, with an estimated stock of over 3% of GDP. The government is paying down roughly TZS 1 trillion of verified arrears per fiscal year. The low deficit is the result of controlled recurrent expenditures and under execution of the development budget by more than 40%. Contributing factors include shortfalls in domestic revenue and external financing for large projects. Public debt is currently sustainable, but there is need for the Government to consider cost-effective financing options and manage associated risks to support public investments. The 2018/19 budget targets public investments to consume 45% of total spending, equivalent to 9.1% of GDP compared to 5.5 a year prior.

    Social Context

    Despite lower poverty rates, the number of poor people has stagnated due to high population growth. The national poverty rate had declined from 34.4% in 2007 to 28.2% in 2012 and then to 26.8% in 2016.

    Last Updated: Apr 01, 2019

  • World Bank Group (WBG) Engagement in Tanzania

    The World Bank’s active portfolio in Tanzania includes 22 national International Development Association projects with total net commitments of $4.23 billion. Key sectors supported include transport (25%), urban development (19%), energy (15%), water (11%), education (9%), social protection (8%), health/nutrition (4%), environment/natural resources (4%) and agriculture, finance, competitiveness and innovation, governance projects make up the rest of the portfolio. Tanzania is also included in six regional projects, with its total commitments reaching $923.3 million supporting the transport, energy, environment, health and education sectors.

    In March 2018, the Bank’s Board of Executive Directors endorsed the new Tanzania Country Partnership Framework 2018-2022 (CPF). The CPF is informed by extensive consultations with a wide range of stakeholders as well as a country opinion survey. Aligned with the priorities identified in Tanzania’s Second Five-Year Development Plan and Zanzibar’s Third Strategy for Growth and Reduction of Poverty, the CPF has three focus areas: (1) enhance productivity and accelerate equitable and sustainable growth, (2) boost human capital and social inclusion, and (3) modernize and improve the efficiency of public institutions.

    The CPF 2018-2022 represents both continuity with, and enhancement of, the current program and more intensive engagement in priority areas. It will deepen investments in transport, information and communication technology, and energy to support spatial transformation and inclusive growth, and will significantly scale up human capital development. These interventions will address the rural-urban divide and boost the enablers for poverty reduction that affect access to infrastructure, social services and productive jobs. Given the key role of the private sector, the new framework will innovate to maximize access to finance and generate jobs for Tanzania’s development.

    International Finance Corporation (IFC)

    IFC’s strategy in Tanzania involves proactively developing infrastructure projects through investment and advisory (Public-Private Partnerships) interventions, focusing on power, oil, and transportation. IFC will also work closely with the International Development Association to identify actions to promote more rapid commercialization of agriculture. IFC’s strategy places emphasis on strengthening financial markets, particularly in terms of access to finance for micro and small-medium enterprises. IFC is looking to forge partnerships with local banks aimed at supporting its initiatives in the financial sector with local currency financing, as well as developing products to support the microfinance, small-medium enterprises and housing sectors. IFC seeks to provide advisory services to improve the investment climate through reform programs that cover licensing, regulatory reform and other areas tracked in the Doing Business indicators.

    Knowledge Products

    High-quality, consolidated knowledge products facilitated and deepened policy dialogue, and informed design and realization of government programs. These products were used to inform plans for, e.g., tourism-led growth and initiatives related to energy, governance, education, and natural resources.

    The Tanzania economic updates have focused on select topics: productive jobs, unlocking the potential of the tourism industry, improving tax performance, and leveraging public private partnerships to finance development.

    Under the current CPF, the Bank will continue to use analytics to guide operations. The analytical products will be prepared in close collaboration with the client, taking into consideration counterpart capacity, and knowledge products will use a combination of hands-on technical assistance, impact evaluations, policy notes and broader reports to inform the lending programs and policy dialogue. The Systematic Country Diagnostic, completed in March 2017, has been recognized by a broad range of stakeholders as an important source of knowledge.

    Last Updated: Apr 01, 2019

  • Education: Tanzania has shown progress in primary education, where levels of access, completion and equity have improved, as did levels of secondary educational attainment for both women and men. In 2016, 23.4% of women and 28.2% of men had completed secondary education, a significant increase from the figures of 16.2% and 22.8% recorded in 2010.

    There was also progress in the areas of housing conditions, the ownership of assets, and access to clean drinking water and sanitation, including for the poor and rural populations.

    Financial Inclusion: The financially-included population increased to 62% in 2017 from 45% in 2009. This has been primarily driven by growth of mobile money services. Tanzania ranks second globally in mobile money use with mobile money transactions value-to-GDP ratio of 53%. The World Bank Group also engages in financial inclusion policy development and implementation, as well as technical assistance and financing investments by the private sector. For example, the International Finance Corporation (IFC) works with financial institutions to provide long-term funds for medium micro, small and medium enterprises. IFC facilitated the negotiations of an interoperability agreement between mobile financial services providers, making Tanzania one of the first countries in the world with an industry-agreed interoperable market for mobile financial services. IFC is also supporting the Bank of Tanzania and industry stakeholders to develop an efficient credit bureau reference system, including the support for the development of the credit reporting system regulatory and oversight framework for the supervision of credit bureaus and data providers to build confidence in the system and improve upon data quality. IFC also supports capacity building for key stakeholders and consumer awareness and literacy of the system and its benefits for lenders and borrowers.

    The World Bank Group (WBG) engagements in Financial Sector: The World Bank and International Monetary Fund (IMF) recently conducted the Financial Sector Assessment Program (FSAP) to review the current financial sector landscape in Tanzania, including financial sector stability and development aspect (diversification and financial inclusion). The FSAP results will support the government and regulators to strengthen and develop a well-diversified financial sector.

    The World Bank (WB) has also been actively supporting development of the long-term finance market, especially the capital market and housing finance. The Bank supported the Dar es Salaam Stock Exchange (DSE) to move from a manual trading system to an automated trading system and provide options / recommendations for new product development. This also led to the establishment of the Tanzania Mercantile Exchange. On housing finance, the WB has supported the development of the mortgage finance and affordable housing markets through a sustainable private sector-driven approach. The Tanzania Mortgage Refinance Company (TMRC) was established to provide medium and long-term liquidity to financial institutions. Between 2011 and 2017, the mortgage portfolio significantly increased and financial institutions offering mortgage products increased 11 times while maturity of mortgage loans is now 3-5 times longer. TMRC has also started to raise capital from the bond market and the project is now a strong model of maximizing finance for development.  

    Last Updated: Apr 01, 2019

  • Donor coordination has been strong at the sector level, and sector working groups have been effective. The World Bank has been actively engaged in and has often led coordination in, for example, fiscal management and public expenditure review, governance, statistics and poverty monitoring, energy, transport, agriculture, private sector development, health and education, and ICT. Leveraging its unique global expertise and knowledge in individual sectors, the Bank has been playing a catalytic role in informing the sector-level dialogues and supports by the donors in the country.

    Partnering with other development organizations for lending and analytical work has been at the core of the World Bank Group’s country strategy in Tanzania. Several large lending programs, such as the Productive Social Safety Net Project, the Education Program-for-Results, the Health Program-for-Results, and the Dar es Salaam Maritime Gateway Project, are co-financed by bilateral donors, including the US, UK, and Sweden. Partnerships through trust funds, such as public-private partnerships (PPPs), transport and urban resilience (Department for International Department), investment climate advisory services (Canadian International Development Assistance), and state-owned enterprise reforms (Norway), provide important complementary support to generation of knowledge on important development issues in Tanzania while facilitating government’s capacity building in related areas.

    Last Updated: Apr 01, 2019



Tanzania: Commitments by Fiscal Year (in millions of dollars)*

*Amounts include IBRD and IDA commitments


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Additional Resources

Country Office Contacts

Main Office Contact
50 Mirambo Street
P. O. Box 2054
Dar es Salaam, Tanzania
For general information and inquiries
Loy Nabeta
Communications Officer
For project-related issues and complaints