The East African Business Council (EABC) has praised President Samia Suluhu Hassan for enabling East Africans to invest in treasury bills and bond markets.
The apex private sector body in the region said in a statement that it appreciates such a bold and visionary decision by the Tanzanian government, through the central bank, on issuing the new Foreign Exchange Regulations 2022 under of the Foreign Exchange Act Cap 271, which will attract and stimulate cross-border investments needed to generate capital and develop the economy in Tanzania and the East African region in general.
According to the EABC, the regulations allow residents of the East African Community (EAC) and the Southern African Development Community (SADC) to invest in treasury bills and bonds.
The regulations also allow a person residing in Tanzania to invest in the prescribed territory.
The EAC Monetary Union Protocol signed on 30 November 2013 provides for monetary and fiscal cooperation to establish monetary stability and facilitate economic integration.
“The East African Business Council is committed to partnering with the Government of the United Republic of Tanzania to promote the free movement of capital and payments as mandated by the Common Market Protocol of EAC (2010),” the statement read.
Treasury bills are short-term government securities, which are issued at a discount and mature in less than a year. Treasury bills are used as the main fundraising instrument to bridge a temporary budget deficit and regulate the money supply, while treasury bills are long-term debt instruments with a maturity of more than one year and pay interest on a semi-annual basis. Treasury bills issued by the Bank of Tanzania have six maturities: 2, 5, 7, 10, 15 and 20 years. They are issued at a fixed interest rate (coupon).