Tanzania to Apply for IMF Loan in 2021

The IMF in Tanzania

On the 3rd of May 2021, the President of Tanzania Samia Suluhu Hassan held an online conversation with the Managing Director of the International Monetary Fund (IMF) Kristalina Georgieva to discuss cooperation between Tanzania and the IMF on economic matters.

During the conversation, President Suluhu assured Georgieva that the Sixth Phase Government will further develop and promote that partnership with the IMF to continue building a strong Tanzanian economy.

She stressed that the government is already taking various measures to strengthen the economy including creating a better business environment, strengthening good governance, and addressing the challenges of climate change.

She recalled that Tanzania’s GDP growth has dropped from an average of 6.9% in 2020 to 4.7% right now due to the Covid-19 pandemic that has affected its productive sectors, tourism, health, and agriculture.

And that’s why the Government needs to work more closely with the IMF to rescue these affected sectors and to develop ongoing strategic projects including the construction of Mwalimu Nyerere Dam on the Rufiji river that will generate 2,115 megawatts, the construction of the modern standard gauge railway, and construction of roads and bridges.

For her part, Georgieva assured President Suluhu that the IMF is ready to further develop its cooperation with Tanzania with the aim of strengthening the economy and provide immediate funding.

Consequently, President Suluhu instructed Tanzania’s Minister of Finance and Planning Dr. Mwigulu Nchemba and the Minister of Foreign Affairs and East African Cooperation Hon. Mulamula who have attended the talks to quickly complete the process to apply for a loan from the IMF.

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Current IMF Support to Tanzania

Tanzania Joined the IMF in 1962.

In June 2020, the IMF approved a grant under its Catastrophe Containment and Relief Trust (CCRT) to cover Tanzania’s debt service falling due to the IMF from 12th June to 13th October 2020, for the equivalent of USD 14.3 million.

And in October 2020, the IMF approved a second six-month tranche of USD 11.6 million debt service relief to cover the debt service of Tanzania from October 14th, 2020 to April 13th, 2021.