Tanzania Bans US Dollar and Other Foreign Currencies in Local Transactions to Boost National Economy
Dar es Salaam, Tanzania — May 2025
The Tanzanian government has officially banned the use of the US dollar and all other foreign currencies for domestic transactions. This directive aims to strengthen the Tanzanian shilling (TZS), curb dollarization, and promote economic sovereignty.
Why the Ban?
According to a statement from the Bank of Tanzania, the move is intended to “stabilize the local currency and restore full control over domestic financial operations.” Authorities say the increasing use of foreign currencies, particularly the US dollar, in everyday transactions was weakening the value and credibility of the Tanzanian shilling.
The decision follows similar steps by other African countries striving to assert greater control over their economies and reduce reliance on external currencies.
What Does the Policy Change?
Under the new directive, pricing of goods and services, as well as payments for transactions within the country, must be done strictly in Tanzanian shillings. This includes sectors such as real estate, tourism, education, hospitality, and retail.
Businesses, especially those in tourist-heavy zones that previously quoted in US dollars, are now required to revise pricing models and use the shilling exclusively.
Exceptions and International Transactions
While the law prohibits foreign currency use within domestic transactions, it does not affect international trade, remittances, or foreign currency accounts held at banks. Tourists and expatriates can still exchange foreign currency at licensed forex bureaus and banks — but cannot use them directly for payments at hotels, shops, or service providers.
The Bank of Tanzania has made it clear that violators of the policy will face sanctions, including fines and possible revocation of operating licenses.
Implementation Timeline and Compliance
The policy took effect immediately following the official gazette publication in early May 2025. Businesses have been given a brief grace period to comply, after which enforcement will begin nationwide. The Ministry of Finance and the Bank of Tanzania have deployed compliance officers to ensure smooth implementation.
Economic and Public Reactions
Reactions have been mixed. Some local economists have lauded the move as a bold step toward reducing dependence on the dollar and empowering the local economy. Others have expressed concern over the potential short-term disruptions to tourism and investor confidence.
However, the government remains optimistic. “This is about protecting the sovereignty of our economy,” a senior official from the Ministry of Finance stated. “Strengthening the shilling means strengthening Tanzania.”
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