Tanzania: Flagship Projects Retains Supremacy

Government expenditures in the 2020/2021 fiscal year are projected at 34.360tri/-, which is 21.7 per cent of the country's Gross Domestic Product (GDP).

The new projection is an increase of about 3.8 per cent of the government's approved 33.105tri/- expenditure in the current 2019/20 fiscal year.

Finance and Planning Minister Dr Philip Mpango unveiled the new estimates in the National Assembly on Tuesday while presenting the status of implementation of the current budget and the next year's budget framework.

Dr Mpango said the government expenditures are further expected to increase by 4.7 per cent to 37.684tri/- in the 2021/2022 fiscal year.

He explained further that recurrent expenditures for the next financial year are projected to rise by 4.7 per cent to 21.66tri/-, translating into 13.7 per cent of GDP.

Development expenditure on the other hand is slated to 12.699tri/- in the year 2020/2021, about eight per cent of GDP, he explained.

The focus of government spending during the period, according to the minister, will be on flagship infrastructure projects, including the Standard Gauge Railway (SGR), Julius Nyerere hydro-power plant which is planned to generate 2,115 megawatts as well as strengthening of Air Tanzania Company Limited (ATCL).

The focus will also be on supply of electricity in rural areas, construction of irrigation projects, expansion of Dar es Salaam, Tanga and Mtwara ports and construction of ships and ferries to serve in major lakes-Victoria, Tanganyika and Nyasa.

The government will also set aside funds for the next general elections in October next year, servicing of the national debt, salaries for civil servants, provision of free education in primary and secondary schools as well as provision of loans to students in higher learning institutions.

Dr Mpango told lawmakers that internal revenue collections during the year 2018/2019 stood at 18.525tri/-, which was 88.7 per cent of the targeted 20.894tri/.

The revenue breakdown indicates that Tanzania Revenue Authority (TRA) collected 15.511tri/- or 86.2 per cent of the targeted 18tri/-, with nonrevenue sources and local government authorities raking in 2.356tri/- and 661.4bn/-, respectively.

Meanwhile, the minister said the national debt increased to 52.303tri/- as of August, this year, from 49.283tri/- during the same period last year.

Internal debts amounted to 14.075tri/- while external debts stood at 38.227tri/-, he explained, attributing the increment of the national debt to new loans which were secured to undertake various development projects.

Dr Mpango, a former World Bank economist, assured the legislators that an assessment conducted by the government in December last year showed that the national debt was on sustainable levels.

Projection for GDP growth is expected at seven per cent this year, with the growth rate likely to increase slightly to 7.1 per cent next year.

Shadow Minister for Finance and Planning David Silinde (Momba-Chadema) complained over delays in disbursement of development funds as the key obstacles in implementation of the Second National Development Plan 2015/2016-2020/2021.

"It is important that funds are disbursed on time to enable smooth and timely execution of development projects," Mr Silinde stressed when presenting views of the opposition in the house.

He as well urged the government to allocate more funds for development projects in agriculture, the sector that employs majority Tanzanians.

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