Fitch Ratings has kept Tanzania’s credit rating at B+ with a Stable Outlook, showing confidence in the country’s economic direction, even as some risks remain.

In simple terms, this rating means Tanzania’s economy is growing and its debt is under control, but there are still some challenges to watch. A Stable Outlook means Fitch does not expect major changes—either better or worse—in the near future.

The country’s economic growth remains a strong point. Tanzania’s economy is expected to grow by about 6 percent in 2026 and 2027, which is higher than many countries with similar ratings. This growth is being supported by key sectors such as agriculture, mining, and major infrastructure projects like the Standard Gauge Railway and the East African Crude Oil Pipeline. Inflation also remains relatively low, helping to keep prices stable.

Government finances are also showing improvement. Fitch expects the budget deficit to stay moderate at around 3 percent of GDP, while public debt is projected to slowly fall from about 50 percent to 47 percent of GDP over the next few years. This suggests that the government is managing its borrowing carefully. At the same time, tax collection is improving, meaning the government is getting better at raising its own revenue. Continued support from the International Monetary Fund also adds confidence that reforms will continue.

However, challenges remain. One key issue is that Tanzania still collects less government revenue compared to similar countries. This makes it harder to fund development projects and public services without relying on loans or external support. Fitch also points to concerns about governance, institutional strength, and policy consistency, which can affect investor confidence.

Another area of concern is foreign exchange reserves. Tanzania has a relatively small reserve of foreign currency, enough to cover about 2.5 months of external payments. This is below the average for countries with the same rating. Because the country depends on imports such as fuel and fertiliser, any rise in global prices can put pressure on the economy. Fitch also warns that ongoing tensions in the Middle East, especially involving Iran and the Gulf region, could increase import costs and affect tourism, adding further strain.

Overall, Fitch’s message is clear: Tanzania is performing well in key areas such as economic growth, inflation control, and debt management. However, the country still needs to improve revenue collection, strengthen institutions, and build larger foreign currency reserves.

In summary, Tanzania’s economy is stable and moving forward, but not yet strong enough for a higher rating. That is why it remains at B+ with a Stable Outlook