<\/p>\n
Tanzania is altering its foreign-exchange laws to allow non-residents to participate in government-securities auctions.<\/p>\n
Until now, only Tanzanians abroad and nationals of the Southern African Development Community and the East African Community could invest in Tanzania\u2019s domestic market.<\/p>\n
\u201cThe reform aims to broaden access to the government-securities market and is part of the bank\u2019s ongoing efforts to deepen the domestic financial markets and promote Tanzania as an attractive investment destination,\u201d the Bank of Tanzania said in a notice.<\/p>\n
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It is the latest reform measure for the nation that adopted a benchmark interest rate-based monetary policy framework at the start of 2024.<\/p>\n
Governor Emmanuel Tutuba announced the publication of a Tanzania sovereign yield curve on Friday that he said was coming in a \u201ctimely manner following the 100% liberalisation of our capital market.\u201d<\/p>\n
The central bank will publish the yield curve daily to give investors a benchmark for pricing loans and corporate bonds.<\/p>\n
\u201cOne of the expected benefits of this yield curve is that it will bring more foreign investors into our market,\u201d Tutuba said.<\/p>\n
The main attraction of local-currency bonds in frontier markets is the relatively high yields they offer, attracting strong bids from foreigners. Tanzania\u2019s 20-year bond maturing in 2047 has a 12.56% coupon, while one with a 2051 maturity carries a 13.25% coupon.<\/p>\n
In neighbouring Zambia, foreigners have piled into the local bond market after the government lifted in January a cap on non-resident participation in debt auctions.<\/p>\n
Tanzania, which historically has depended on concessional loans from multilateral lenders for its budget, plans to borrow 3.27 trillion shillings ($1.24 billion) from domestic sources this fiscal year, nearly 11% higher than a year earlier.<\/p>\n
Finance Minister Khamis Mussa Omar said last month that Tanzania could sell a Eurobond this year if market conditions allow. While he didn\u2019t specify the size of the bond, one adviser to the Tanzanian government said the issue could raise as much as $500 million.<\/p>\n
\u00a9 2026 Bloomberg<\/p>\n
#Tanzania #relaxes #forex #rules #draw #foreigners #bonds<\/p>\n","protected":false},"excerpt":{"rendered":"
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