International Monetary Fund Approves Tanzania Policy Support Instrument

Tanzania has received a new three-year Policy Support Instrument (PSI) from the International Monetary Fund (IMF) to be used to assist the country in reaching its objectives including macroeconomic stability, debt sustainability, equitable growth and the creation of new jobs.

According to the country’s review, Tanzania has a favourable macroeconomic outlook, especially due to the finding of natural gas resources, and is expected to sustain high growth rates averaging 7% annually, and is likely to remain at low risk of debt distress

Naoyuki Shinohara, Deputy Managing Director and Acting Chair of the IMF in Tanzania stated Tanzania will sustain its positive macroeconomic performance based on the authorities’ intention to undertake necessary reforms to improve the investment climate, and on the appropriate budget and potential gas revenues.

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“Tanzania stands to benefit from potential revenues from offshore extraction of natural gas, likely to start in the early 2020s”, said Hon. Shinohara, adding that a framework of full integration of resource revenues in the budget is needed for further successful development.

The Public Support Instrument will support programs in Tanzania that will strengthen public finance management practices, improving public spending, mobilizing revenues, reducing aid dependence, and achieving financial stability, poverty reduction, and sustainable development.

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