BoT to dish out 300bn/- in dividend to the state

29Dec 2017
The Guardian Reporter
The Guardian
BoT to dish out 300bn/- in dividend to the state

THE Bank of Tanzania (BoT) board of directors has approved 300 billion/- as dividend payment to the government for the 2016/17 fiscal year.

According to a statement issued by outgoing BoT governor Prof Benno Ndulu, the dividend comes out of profits collected for the year as required by law.

This brings the bank’s total dividends to the government over the past three years (2014/15 to 2016/17) to 780bn/.

In 2014/15, the bank issued a 180bn/- dividend, followed by a 300bn/- dividend in 2015/16.

According to then statement, the dividends are paid in line with Article 18 (5) of the Bank of Tanzania Act of 2006, which authorises the central bank to “issue dividends to the government whenever it makes profits.”

Making profit is not one of the bank’s basic responsibilities, but when it happens, dividend has to be paid to the government, the law says.

As per the legislation, the primary role of the bank is to formulate, define and implement monetary policy, directed to the economic objective of maintaining domestic price stability, conducive to a balanced and sustainable growth of the national economy.

The bank also has the sole responsibility of issuing notes and coins in the country to directly influence the amount of currency in circulation outside banks. It is obliged to provide economic advice and preserve foreign currency, among other things.

Back in July, Finance and Planning Minister Philip Mpango directed all state-run companies to increase their dividend payments to the government.

“We (government) need to improve water supplies to communities, ensure availability of electricity for our children to study, and ensure access to beds in hospital wards,” Mpango said.

He said figures showing that over 13 million Tanzanians are living in abject poverty are too alarming and institutions controlled by the state must support the government to improve social service access and delivery.

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