Fitch Upgrades Tanzania Outlook to Positive

Fitch Upgrades Tanzania Outlook to Positive

Fitch Ratings revised the outlook on Tanzania’s long‑term sovereign issuer default rating (IDR) from Stable to Positive on 22 August 2026, while affirming the B+ rating. The agency cited a projected strengthening of international reserves and moderate fiscal deficits, combined with continued high economic growth, as the basis for a downward trajectory in government debt.

International reserves are expected to increase from $6.3 billion at the end of 2025 to $7.9 billion by 2028, providing coverage of current external payments for approximately 3.3 months. Fiscal performance is projected to show a deficit of 2.8 % of GDP for the fiscal year that ended in June 2026, with the deficit remaining close to 3 % of GDP through FY 2028. Tax revenues have risen by one percentage point to 15.6 % of GDP between FY 2023 and FY 2025 under the government’s Medium‑Term Revenue Programme.

Government debt‑to‑GDP is forecast to decline to 46.2 % in 2028 from 48.9 % in 2025, positioning Tanzania well below the ‘B’ median figure of 55 % for the same period. Real GDP growth is projected at 5.8 % in 2026, substantially above the ‘B’ median of 3.7 %, and is expected to average 6.1 % in 2027‑2028. The agency attributes this resilience to continued public investment, a robust tourism sector, Tanzania’s role as a regional logistical hub, and the emerging mining sector, while also noting the economy’s capacity to absorb shocks such as the war in Iran.