Moody’s Ratings has reaffirmed Tanzania’s long-term issuer rating at B1 with a stable outlook, citing strong economic fundamentals and sustained growth prospects driven by manufacturing, mining and tourism.
In its latest assessment released on February 23, 2026, the global ratings agency said Tanzania’s economy is expected to grow by around 6 percent annually through 2026, supported by rising private-sector investment, improved policy effectiveness and continued public spending on strategic infrastructure.
Moody’s noted that growth is becoming increasingly broad-based, with manufacturing and mining benefiting from higher investment in processing and value addition.
These developments are expected to strengthen exports and support job creation. The tourism sector is also recovering strongly, aided by improved transport services and increased international arrivals, while infrastructure investment continues to enhance energy reliability and logistics.
On the monetary side, the agency commended the strong performance of the Bank of Tanzania, which has maintained inflation below 5 percent for nearly eight consecutive years.
Recent reforms to allow greater exchange-rate flexibility have helped eliminate parallel foreign-exchange markets and reduced vulnerabilities to external shocks, further strengthening macroeconomic stability.
Fiscal management was also viewed positively. Although public debt has increased to just under 50 percent of GDP due to sustained infrastructure spending, Moody’s described the level as moderate compared to regional peers.
The agency expects the debt burden to stabilize at current levels, supported by strong nominal growth and improved domestic revenue mobilization.
Revenue performance remains a key credit strength. Non-grant government revenue is projected to exceed 17 percent of GDP this year, up from 13.7 percent in 2021, reflecting progress in tax administration reforms and compliance measures.
While interest payments currently account for about 16 percent of government revenue, Moody’s expects pressures to ease as digitalization of tax systems and efficiency gains continue.
However, the agency cautioned that Tanzania still faces social and political challenges following the 2025 general elections.
Although calm returned after the presidential inauguration, Moody’s highlighted underlying social risks linked to a rapidly growing youthful population, rising demand for jobs and public services, and persistently low household incomes.
The report also pointed to potential financing risks, noting that access to concessional external financing has weakened following the election period, which could raise borrowing costs in the medium term.
On environmental, social and governance considerations, Moody’s assigned Tanzania a Credit Impact Score of CIS-4, indicating that ESG factors continue to weigh on the rating.
Climate-related risks such as droughts and floods remain a concern, particularly for agriculture, while gaps in access to basic services and education outcomes present social challenges. Governance indicators are improving, but still lag behind global peers.
Overall, Moody’s said the stable outlook reflects Tanzania’s strong growth trajectory and improving policy framework, balanced against structural, social and environmental challenges that will require sustained reform efforts to address over the medium to long term.