Tanzanian Shilling Explained

Ashly Chole Senior Finance Researcher

Last Updated 24 April 2024

Tanzanian Shilling

The United Republic of Tanzania's national currency is the Tanzanian shilling (TZS). The East African shilling, which was first used in Aden as a substitute for the Somali shilling, was replaced by the Tanzanian dollar (TZS). In a lot of nations, the shilling is a widely used currency. With a cap on its value, it is issued by the Bank of Tanzania. Africa contains Tanzania as a nation. Located on Africa's east coast, it boasts a population of about 54 million, with Dodoma serving as the nation's capital. Swahili is Tanzania's official language, although due to its use in international trade, English is also commonly spoken there. There are numerous natural beauties and attractions in Tanzania. The biggest continuous volcanic caldera in the world, the Ngorongoro Crater, is one of them. The vast eruption that created this crater over a million years ago took place in northern Tanzania.

The Somali shilling

1921 saw the debut of the Somali shilling. The Somali shilling was used as Somalia's unit of currency. When Kenya became a British colony, its governor established two currencies: one for Kenya, called the 'East African shilling' or 'East African pound,' and another for Uganda (which retained its name), called the 'West African pound.' All of those nations' prior currencies were replaced by the East African pound (except for some local coinage). The same thing happened in Tanzania when it gained independence from Britain: they used their own currency when they joined the monetary union of Zanzibar, which obliged them to create a national currency, this time named the Tanzanian shilling.

In order to establish a shared market, Tanzania and Kenya agreed to launch their own currencies. They all decided to use Indian rupees as a single currency, nevertheless, because their respective currencies could not be exchanged for those of other countries in the area (such as the Tanzanian or Ugandan shilling).

The shilling is a widely used currency in many nations

Several nations use the shilling as a common currency. The Tanzanian shilling (TZS) is accepted in more than 25 nations, including France and Spain. Tanzania's central bank is called the Bank of Tanzania. It was started in 1965, and its main office is in Dar es Salaam. Tanzanian shillings, which are divisible into 100 cents, are issued by the bank and are subject to its monetary policy. There are five branches in significant cities. The shilling's currency symbol is TZS.

The bank's responsibilities

Including the control of interest rates, foreign exchange, and credit, the bank is in charge of all facets of monetary policy and currency management. To maintain price stability, the Bank of Tanzania regulates the amount of money in circulation. To do this, open market operations are used, which entail the purchase or sale of government securities on the secondary market. In addition, the bank regulates the foreign currency market in Tanzania by granting authorization to banks and other financial entities. In addition to being a signatory to the Declaration of Principles for Good Conduct in Development-Finance Partnerships, the Bank of Tanzania is a member of the Alliance for Financial Inclusion. It also participates in the Economic, Monetary, and Monetary Fund of the African Union (EMF). When Tanganyika and Zanzibar united to create Tanzania in 1965, the bank was founded.

The governor is chosen by Tanzania's president, and the institution is independent. Two subsidiaries belong to the bank. Tanzania only has one organization with the authority to print money, and that is the Bank of Tanzania. All Tanzanian shilling banknotes and coins are printed, produced, and distributed by it. As well as offering deposit services to both individuals and businesses, the bank also offers financial services such as check clearing, currency trading, and money transfers. Dar es Salaam, Tanzania's capital city and financial hub, is where the bank's headquarters are situated. A five-year term is assigned to the bank governor after appointment.

The ISO code for Tanzanian Shilling

The Tanzanian Shilling's ISO code is used to identify the nation, currency, and area. It also indicates the language used in Tanzania. The shilling is a component of the Convention against Transnational Organized Crime and its Narcotics Trade, which was signed in London by the UK, US, and France. Tanzania's national currency is the shilling, which 255 million people globally utilize at the moment. The shilling, which is divisible into 100 cents, is sometimes referred to as the East African shilling. It has been a part of the British Commonwealth.

Convention on International Traffic in Narcotic Substances

The Convention intends to combat cross-border smuggling of migrants by land, sea, and air by reducing people trafficking from developing into developed nations, preventing illegal migration across borders, and protecting and assisting trafficking victims. prosecute those responsible for human trafficking, gather information about related crimes for use by national law enforcement at all levels, including regional organizations, work closely with other regional organizations that share your goals but may be more focused on a specific crime than what is currently covered by this treaty, and encourage international cooperation in detecting and prosecuting cross-border crimes.

After more than five years of discussions, the Convention was born. It covers topics such as the definition of human trafficking and its reach, criminal prosecution, crime prevention, and victim protection, as well as collaboration between the States Parties, including extradition requests and reciprocal legal aid. The agreement also lays forth precautions against corruption linked to human trafficking.

States Parties must take action to stop human trafficking and safeguard its victims

In addition to the aforementioned, it outlines a number of steps that States Parties should take to stop human trafficking and safeguard its victims. They should, in particular, adopt specific laws and policies to prevent human trafficking; offer victims assistance and protection services, including access to civil remedies; ensure that those who are trafficked are not punished for crimes committed as a direct result of being trafficked; collaborate with other States Parties to increase their capacity to combat trafficking in persons through international cooperation; and encourage gender awareness among the general public.