Govt to Borrow 347bn/- From Local Sources

nngu007 · 2011-04-11T14:37:01+00:00

Abduel Elinaza POOR revenue collection has forced the government to borrow 346.52bn/- from internal sources to finance its budget, it has been learnt. The amount represents one per cent of the country's Gross Domestic Product (GDP) and would be spent to fill a gap created as a result of the Tanzania Revenue Authority (TRA) failure to meet its collection target. The Ministry of Finance and Economic Affairs said in a statement on Thursday that efforts are underway to increase revenue collection to reach at least 94 per cent of yearly tax target. "After considering the current situation (on revenue collection), the government has decided to borrow internally to maintain the economic growth," the statement said. However, the ministry said the total government expenditure in the current budget year would fall short by 510.42bn/-, "not because of streamline spending, but due to deficit of revenue collections and loans." The national debt stock at the end of January stood at 10.97 billion US dollars, representing a decrease of 2.1 per cent compared to 10.98 billion dollars recorded at the end of the preceding month. "The decrease was mainly explained by low issuance of Treasury Bills compared to maturing obligations," the Bank of Tanzania (BoT) said in its monthly economic review report issued in February. Out of the total stock, 82.0 per cent was external debt and 18.0 per cent was domestic debt. But the Chairman of Parliamentary Public Account Committee, Mr John Cheyo said the national debt is ballooning at an un-proportional rate and should be checked "to save the country from becoming debt slave." "The debt should grow at an acceptable level," Mr Cheyo told the parliament in Dodoma on Wednesday when presenting his committee's report on public accounts. Nevertheless, the central bank said, on cumulative basis for the first seven months of 2010/11, the government expenditure reached 5.23trn/-, against the estimated 5.92trn/-. Recurrent expenditure amounted to 3.85trn/- in line with budget estimates whereas 1.38trn/- or 71.4 per cent of budget estimate was spent on development projects. The under performance in development expenditure was mainly a result of lower disbursement of project grants which was only 14 per cent of the projected 546.7 billion, the central bank said. The total expenditure during the first seven months of 2010/11 was 15.1 per cent, compared to 13.7 per cent of corresponding period in 2009/10.

Thread starter nngu007
Start date Apr 11, 2011

nngu007

JF-Expert Member

Apr 11, 2011

M-mbabe

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