Macroeconomic Policy Development in Tanzania

The document examines Tanzania's macroeconomic responses to the COVID-19 pandemic, noting that a 'business-as-usual' approach without lockdowns, combined with expansionary monetary and fiscal policies, helped the country avert a recession in 2020. It details specific Bank of Tanzania (BoT) interventions to maintain liquidity and recommends further macroprudential policies, increased healthcare financing, and the implementation of climate-resilient economic strategies.

• Tanzania avoided an economic recession in 2020 by combining a 'business-as-usual' approach that avoided lockdowns with expansionary macroeconomic policy measures.
• The COVID-19 pandemic negatively impacted Tanzania's fiscal and balance-of-payments demands, specifically causing a sharp decline in traditional export receipts and tourism.
• To support business liquidity during the pandemic, the Bank of Tanzania (BoT) implemented several monetary easing measures, including reducing the statutory minimum reserves from 7% to 6% and lowering the discount rate from 7% to 5%.
• The BoT further increased commercial bank liquidity by reducing interest on Treasury bills from 10% to 5% and Treasury bonds from 40% to 20%.
• The government utilized fiscal measures to boost growth, including reducing taxes in the 2020/21 budget—such as removing VAT on crop insurance—and accelerating the payment of VAT refunds and domestic payment arrears.
• To protect vulnerable populations, the document recommends fast-tracking the disbursement of $882 million for the Productive Social Safety Net Programme (PSSN) via the Tanzania Social Action Fund (TASAF).
• The briefing recommends that Tanzania build a climate-resilient economy by accelerating the environmental, disaster-preparedness, and climate-change components of the Third National Five-Year Development Plan (2020/21 to 2025/26).

APA

MASHINDANO, O. J., & KAZI, V. (n.d.). Macroeconomic Policy Development in Tanzania. South African Institute of International Affairs. https://saiia.org.za/wp-content/uploads/2022/03/CoMPRA-14-mashindano-kazi5159.pdf

Chicago

MASHINDANO, OSWALD JOSEPH, and VIVIAN KAZI. Macroeconomic Policy Development in Tanzania. South African Institute of International Affairs, n.d. https://saiia.org.za/wp-content/uploads/2022/03/CoMPRA-14-mashindano-kazi5159.pdf.

Wikipedia

{{cite report |last1=MASHINDANO |first1=OSWALD JOSEPH |last2=KAZI |first2=VIVIAN |title=Macroeconomic Policy Development in Tanzania |publisher=South African Institute of International Affairs |url=https://saiia.org.za/wp-content/uploads/2022/03/CoMPRA-14-mashindano-kazi5159.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{mashindanondmacroeconomic, author = {MASHINDANO, OSWALD JOSEPH and KAZI, VIVIAN}, title = {{Macroeconomic Policy Development in Tanzania}}, institution = {South African Institute of International Affairs}, url = {https://saiia.org.za/wp-content/uploads/2022/03/CoMPRA-14-mashindano-kazi5159.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }