Dar es Salaam. Financial leaders from across Sub-Saharan Africa have expressed cautious optimism about the region’s financial stability, even as climate change, cyber threats, debt pressures and global policy uncertainties continue to test economic resilience.
Speaking during the Financial Stability Board Regional Consultative Group for Sub-Saharan Africa meeting in Zanzibar, Bank of Tanzania Governor, Mr Emmanuel Tutuba, said the region must remain vigilant against mounting global and domestic risks.
“Geopolitical tensions, climate-related risks, policy uncertainties and the aftermath of the pandemic have fuelled inflationary pressures, heightened debt vulnerabilities and triggered volatile exchange rate movements,” he said. “These dynamics have constrained fiscal space and complicated the attainment of fiscal targets.”
Despite these headwinds, Mr Tutuba said Tanzania’s financial sector remains stable and well positioned to support economic growth.
“Looking ahead, Tanzania’s financial sector is expected to maintain its resilience. The banking sector will remain well capitalised and liquid, broadening access to financial services for households and businesses,” he said.
He cited strong economic performance, with growth in 2025 estimated at six percent for Mainland Tanzania and 6.8 percent for Zanzibar. Growth is projected to rise further in 2026 to 6.3 percent and 7.2 percent, respectively, driven by improved agricultural productivity, reliable electricity supply, rising gold and coffee exports, and increased tourist arrivals.
Inflation has remained within the medium-term target range of three to five percent, fluctuating between 3.1 percent and 3.6 percent in the second half of 2025 on the Mainland, while averaging 3.7 percent in Zanzibar. “Prudent monetary policy, stable food prices and exchange rate stability have been key anchors,” Mr Tutuba said.
The banking sector’s asset quality has also improved, with the non-performing loan ratio declining to 2.8 percent in December 2025, below the five percent tolerable threshold. Credit to the private sector expanded by 17.6 percent, reflecting improved business confidence.
Mr Tutuba underscored the importance of regional cooperation in addressing emerging risks, including those linked to fintech innovations, cryptocurrencies and artificial intelligence.
“Collaboration is essential. We must continue to share best practices, data and insights to create an enabling environment for growth, innovation and stability across the region,” he said.
Global Manager for Financial System Resilience and Integrity at the World Bank, Ms Saskia de Vries, said banking crises in Sub-Saharan Africa have had relatively contained impacts compared to other regions.
“On average, GDP per capita is only about three percent lower than pre-crisis levels one year after a crisis occurs,” she said, cautioning that resilience depends on strong macroeconomic fundamentals.
She warned that in higher-risk countries, financial stability is closely tied to market depth, liquidity and the concentration of sovereign debt holdings, particularly where domestic banks hold significant shares of government securities.
“To mitigate sovereign-bank nexus risks, authorities should reduce overreliance on domestic banks for sovereign financing,” she advised.
On foreign exchange pressures, Ms de Vries noted that although several African currencies have strengthened against the US dollar over the past year, some countries continue to face persistent shortages due to structural imbalances and global financial tightening.
“A common response is to impose foreign exchange controls. However, once implemented, such measures are often difficult to unwind and can result in dual exchange rate regimes and widening spreads between formal and informal markets,” she said.
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