Dar es Salaam. Public enterprises, including Air Tanzania Company Limited (ATCL) and the Tanzania Railways Corporation (TRC), continue to face financial difficulties despite ongoing government support, according to the 2024/25 report by the Controller and Auditor General (CAG), Mr Charles Kichere.
The report shows that 22 State-owned commercial entities recorded losses over a period of one to two years, largely due to operational inefficiencies and structural challenges.
The remarks were made on Monday, March 30, 2026, by CAG Mr Kichere while presenting the institution’s 2024/25 report to President Samia Suluhu Hassan at State House, Dar es Salaam.
For ATCL, the CAG reported that by June 2025, the airline’s accumulated debt had reached approximately Sh748 billion since its revival.
In the 2024/25 financial year alone, the company posted a loss of Sh191.19 billion, an increase of 108 percent, bringing total losses to over Sh700 billion, despite continued government subsidies for salaries and operations.
He said the losses were driven by a sharp rise in operating costs, which outpaced revenue growth. Expenses increased by Sh134 billion to reach Sh675 billion. Additionally, flight performance fell below expectations, with 87 routes recording an average passenger load factor of just 55 per cent.
The audit also highlighted inefficiencies in the use of cargo aircraft, noting that 94 per cent of flights operated on short- and medium-haul routes instead of more profitable long-haul services. The aircraft was often underutilised and, at times, grounded, yet continued to incur costs of about Sh3.35 billion for leasing and insurance without generating revenue.
Further concerns included weak internal controls, leading to losses of about Sh20 billion through agents without confirmation that tickets reached passengers, alongside frequent flight delays and cancellations.
“I believe the airline has the potential to become profitable,” said Mr Kichere, recommending a review of route planning and a restructuring strategy to improve performance, strengthen route management systems, enhance integration of Information and Communication Technology (ICT), and improve oversight and accountability in the use of resources.
Meanwhile, TRC continues to face operational challenges affecting its financial performance, particularly on the ageing metre gauge railway (MGR), where declining cargo volumes have reduced revenue and increased reliance on government subsidies, despite improved earnings from the standard gauge railway (SGR).
The corporation also incurred losses linked to railway accidents, which reached 328 incidents and caused damage worth approximately Sh3 billion, largely due to inadequate maintenance of infrastructure.
The CAG recommended that TRC strengthen routine maintenance and explore insurance cover for key strategic assets to minimise future losses.
