THE CITIZEN (editorial)
The Higher Education Students’ Loans Board (HESLB) made a startling announcement yesterday: It will engage the Tanzania Revenue Authority, National Identification Authority, Tanzania Commission for Universities, the Business Registration and Licensing Agency and diplomatic missions to locate former university students who have not paid college loans amounting to a staggering Sh1.1trillion in the past 18 years.
By any standard, Sh1.1 trillion is a huge amount. Besides being equivalent to 7.2 per cent of the national 2012/2013 budget, the money could also help HESLB loan 40,000 students for over eight years. The amount is more than the Sh842.5 billion that the country expects to get from its general budget support partners in the current financial year. Yet our scholars see no reason to pay up.
Interestingly, these defaulters are the very same people who stand up in political, academic, religious and social platforms and declare that 51 years of independence are meaningless without economic independence. How does a country attain economic independence if its people are busy working out how to avoid paying the money loaned to them?
Worse still, if these “experts” evade paying what they owe, what can the country expect of them in their workplaces? Will they not extend their inherent defaulting tentacles to their workmates and business associates? Bankers estimate the country’s default or premium risk at a range of between seven to 10 per cent, way much higher than in developed countries, where default or premium risk is estimated to be less than one per cent. The results of such high default rates are devastating on private sector growth as they force commercial banks to keep lending rates at levels that are inordinately high for many potential clients. If we do not fight the defaulting mentality that is so ingrained in minds of Tanzanians, our country will never become economically independent.
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