Dar es Salaam. As Tanzania’s national debt continues to fuel debate, David Kafulila, the founding Executive Director of the Public-Private Partnership Centre (PPPC), believes the country can curb its reliance on borrowing by tapping into the potential of public-private partnerships (PPPs).
In an exclusive interview with The Chanzo, Kafulila—a politician-turned-technocrat—maintained that Tanzania’s debt remains manageable compared to its East African peers. However, he stressed that PPPs offer a viable alternative to heavy borrowing for financing large-scale development projects.
“Increasing capital through coordinated public-private partnerships enhances tax capacity, as these projects generate revenue,” Kafulila said. “They also reduce expenditures that would otherwise fall solely on the government. By leveraging private sector resources, efficiency, and technology, Tanzania can achieve sustainable growth—a reality many nations now recognise.”
Recent figures from the Controller and Auditor General (CAG), Charles Kichere, show Tanzania’s national debt has risen to Sh97.35 trillion in 2023/24, up from Sh82.25 trillion in 2022/23—an 18.36 per cent increase. External debt accounts for Sh65.40 trillion, while domestic debt stands at Sh31.95 trillion.
During the interview, Kafulila highlighted Tanzania’s goal to grow its economy from US$85 billion to US$700 billion.
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“Aiming for a US$700 billion economy means surpassing South Africa’s current GDP of US$405 billion by over 1.5 times,” he noted. “You cannot achieve this through borrowing and taxes alone. Strategic partnerships are essential.”
The PPPC currently oversees over 84 public-private partnership projects, including the US$340 million Kibaha-Chalinze road and a US$1 billion ring road construction project. Mr. Kafulila has championed greater private sector involvement in public infrastructure, highlighting the advantages of modern technology, efficiency, and faster project delivery.
In September 2024, he led a delegation to India’s PPP Centre to learn from their successful models and attract potential investors, particularly in the aviation sector. This visit aimed to leverage Tanzania’s strategic position as a gateway to Africa and boost its aviation infrastructure.
Apart from exploring the potential of public-private partnership in funding Tanzania’s development agenda, Mr Kafulila also believes that anti-corruption measures will help Tanzania save a lot and be in a better position to fund its ambitions without over-relying on international borrowing.
In the reports he submitted to President Samia on Thursday, CAG Kichere revealed that audits conducted in 12 out of 217 parastatals uncovered inefficient expenditures amounting to Sh371.42 billion. He stated that these financial resources were used on activities that did not add value to the respective public institutions. He urged the government to address these inefficiencies.
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In an interview with The Chanzo, Mr Kafulila said: “I agree that the fight against corruption increases efficiency and accountability. When you improve efficiency and accountability, you save losses that would have resulted from those inefficiencies. Therefore, this is the reality.”
Mr Kafulila seized the moment to talk about the importance of local companies participating in the public-private partnerships project that the government seeks to implement, arguing that authorities prioritise this not just for political reasons but also economically.
“When you build the economy using domestic partnerships, first, you inject capital into the economy because these partners are local. What they earn, they reinvest here, unlike foreign investors, who would repatriate a significant portion of their earnings,” Mr Kafulila said.
“Now, in evaluations, according to the law, when assessing a company for a project, if a foreign company is competing with a local one, the local company is given priority—not just for political reasons but also for economic ones, because the money will circulate locally,” he added.
