The John Magufuli government has a good plan to pay the debt. Available data reveals Sh64 or more out of every Sh100 collected by the Tanzania Revenue Authority (TRA) this year, FY2018/19, will be spent in repaying.
Data available in April shows Sh11.78 trillion was collected in the three quarters of the financial year, which means about Sh1.3 trillion collected each month.
Finance and Planning minister Phillip Mpango said in the FY2018/19 they have spent Sh10 trillion towards paying for debt.
In the budget for FY2018/19 Sh10 trillion was allocated for debt repayment, which means a monthly payment of Sh833 billion, about 64 percent of Sh1.3 trillion collected each month by the taxman.
Addressing to the Parliament on Monday he added debt sustainability analysis was conducted last year in November and the report reveals it to be sustainable.
Mpango said, “The ratio of the government debt to the Tanzania’s Gross Domestic Product (GDP) stood at 34.4 perent as of June 2017 against a threshold of 56 percent.”
Even though the debt is sustainable, the government is doing is taking every possible steps to keep it within the manageable levels, said Mpango.
The minister further continued that the borrowed funds will be invested into such projects which will help the country in stimulating economic activities.
On the other hand, the deputy chairman of parliamentary committe, Jitu Soni, said in past one year ending March 2018 the liability rose by 16.2 percent.
Meanwhile, it is also noted most of the ministry received far less fund for development projects than what were budgeted.
