Tanzania's efforts to restore its credit rating among global lenders under President Samia Suluhu continued to bear fruit with the International Monetary Fund's latest approval of a zero-rated $372.4 million loan to support Covid-19 pandemic relief measures.

President Suluhu this week hosted the World Bank's Managing Director for Development Policy and Partnerships Mari Pangestu at State House in Dar es Salaam, in what officials described as a follow-up to the face-to-face talks she held with the bank's president David Malpass on the sidelines of the UN General Assembly in New York in September.

The latest IMF loan will be issued through the Fund's Rapid Credit Facility (RCF) and is part of a $567.25 million package released in September under a blended RCF/Rapid Financing Instrument (RFI) programme.

While the RFI part of the loan remains non-concessional, the RCF disbursement will allow Tanzania to "take full advantage of its new eligibility to borrow from the fund on fully concessional terms," the IMF said in a statement.

Global confidence

The announcement is the latest manifestation of renewed global confidence in Tanzania's approach to addressing cross-cutting issues such as Covid-19, downplayed during the late John Magufuli’s government.

According to IMF, the RCF disbursement will "help address Tanzania’s urgent balance of payment needs arising from the Covid-19 pandemic and provide it with concessional resources needed to take measures to mitigate the severe socio-economic impact of the pandemic."

The September 2021 funding announcement followed a pledge by Tanzania’s Finance minister Mwigulu Nchemba to resume publishing up-to-date Covid-19 statistics, including case and death numbers.

According to the IMF, recent reporting of Covid-19 data in Tanzania has indicated “an increase in the number of cases amid a third wave of the virus” while travel services receipts and travel arrivals continue to remain below pre-pandemic levels collapse in tourism in the wake of travel restrictions, growth reportedly decelerated to 4.8 percent in 2020, and economic performance is expected to remain subdued in 2021," the fund said.

Mr Li however sad the country’s risk of external and public debt distress remained moderate.