Government Domestic Debt

Treasury Bills

Treasury bills are short-term government securities, which are issued at discount and mature in less than a year. Treasury bills are used as a primary instrument for raising funds to meet temporary budget deficit and regulate money supply. Currently, the Bank of Tanzania issues on behalf of the Government of Tanzania, treasury bills in four maturities, namely 35, 91, 182 and 364 days. The minimum bid amount for Treasury bills is TZS 500,000 (Five Hundred Thousand Tanzania Shillings in multiples of TZS 10,000.

Treasury Bond

Treasury bonds are long-term debt instruments with a maturity period of more than one year and pay interest on semiannual basis. Treasury bonds issued by the Bank of Tanzania are in six maturities: 2, 5, 7, 10, 15 and 20 years. They are issued at fixed interest rate (coupon). The minimum bid amount for Treasury bonds is TZS 1,000,000 (One Million Tanzania Shillings) in multiples of TZS 100,000. They are quoted at either Premium, Par or Discount. As investment instruments, both Treasury Bills and Treasury Bonds have the following advantages:
  • They are relatively risk free because they are issued by the Government.
  • They are transferable and negotiable.
  • They can be pledged as collateral.
  • The rate of return is competitive.