Tanzania’s Budget Points to a Promising Future for Telecommunications

Three weeks ago, Tanzania’s Minister of Communications and Information Technology, Jerry Silaa, presented the FY 2025/26 budget estimates for his ministry before the National Assembly. His budget has ambitious targets to expand digital infrastructure via the National ICT Broadband Backbone (NICTBB), with approximately TSh 80.7 billion (USD 30.7 million) earmarked for expanding the NICTBB, including the construction of a 186-kilometre line from Kigoma to the Democratic Republic of Congo. The extension is strategic, as it aims to connect Tanzania to the DRC via high-capacity fibre, thereby enhancing East-West regional internet traffic and boosting trade, cross-border communications, and data exchange. This will position Tanzania as a digital gateway to Central Africa.

It will also strengthen the national fibre optic grid, improve the redundancy and resilience of internet services and help lower bandwidth costs over time by lowering dependency on international links (via satellite or coastal cables alone). Areas like Kigoma will have access to high-speed internet. 

In addition to the expansion of broadband, the ministry allocated TSh 24.85 billion (USD 9.3 million) to the Digital Tanzania Project, which consists of various initiatives such as establishing ICT colleges in Nala-Dodoma and Buhigwe-Kigoma, developing National Data Storage Centres in Dodoma and Zanzibar, implementing Last Mile Optic Fibre infrastructure for 100 justice, safety, and security institutions, installing Wi-Fi access in 50 public areas, enhancing video conferencing equipment in 100 districts and conducting feasibility studies for national digital infrastructure development among others. 

This is beneficial to the Telecommunications industry as it offers a plan to train the next generation of network engineers, system administrators, and telecom technicians, increasing local talent availability and reducing operator training costs, while improving service quality. The plan also supports domestic data hosting and cloud services while also expanding fibre penetration into secure and remote government facilities.

In addition to these plans, the ministry intends to use the Universal Communications Service Access Fund (UCSAF),  established under the Universal Communications Service Access Act No. 11 of 2006, to extend communication services to underserved and unserved areas across the country,  to construct communication towers in 280 underserved villages during the 2025/26 fiscal year. This initiative aims to bridge the digital divide and promote socio-economic development in rural communities. The construction of these towers will enhance network coverage in remote areas in a bid to bridge the digital divide in Tanzania. 

 Since its inception, UCSAF has supported the deployment of over 1,500 communication towers across Tanzania, significantly improving network coverage. As of late 2023, 96% of the population has access to 2G services, 77% to 3G, and 65% to 4G. The Universal Communications Service Access Fund (UCSAF) is primarily financed through mandatory contributions from licensed telecom operators and allocations from regulatory bodies. The minister stated that UCSAF expects to collect 64.2bn/- from its revenue sources in FY 2025/2026. 

The wider network coverage, reduced investment risk, and faster time to service will benefit the telecommunications industry, expanding its consumer base and encouraging service innovation in Tanzania if the ministry achieves its targets.