The Bank of Tanzania’s (BoT) monthly economic review showed that, gold and manufacturing exports rose highers compared to the past two years.
Exports from Tanzania have slightly increased, according to a recent economic review from the National Bureau of Statistics (NBS).
NBS’s second-quarter report, indicates that the economy has grown to 7.2 percent, anchored by the Information and Communications Technology (ICT), construction and water sectors, hence—still the external sectors records significant deficits, sparked by importation of higher goods imports.
The report showed that the overall balance of payments was a deficit of $37.7 million in the year ending September 2019 compared with a deficit of $276.4 million in the year ending September 2018. Meanwhile the current account deficit widened to over $2,1 billion from over $1.8 billion, owing to higher goods imports, particularly capital and intermediate goods which are used for production.
However, on the other side of the sector, the report argues that: Tanzania’s holds sufficient reserves to sustain its operations for over 6.1 months of projected imports of goods and services, which is higher than the country benchmark of not less than 4.0 months, and East Africa Community (EAC) and Southern African Development Community (SADC) benchmarks of at least 4.5 and 6.0 months.
Additionally, in that context, the BoT, highlights that foreign assets of banks increased to about $1.1 billion from $1.052.4 billion in the year ending September 2018.
Per the report, the exports took a slight rise in the year ending September 2019, with a 5.2 rise, which is equivalent to $9 billion, compared to 921.8 million in August. This is attributed to the increase in service receipts and value of non-traditional goods exports, which were worth around $3.9 billion, higher than $3.2 billion in the corresponding period in 2018.
“Earnings from all major categories of non-traditional goods exports increased, except for fish and fish products, and re-exports. Export of gold accounted for 48.6 per cent of nontraditional goods exports and increased by 26.1 per cent to over $1.9 billion on account of volume and price effects. Export value of manufactured goods grew by 32.6 per cent to $1 billion, driven by exports of sisal products, iron and steel, glass and glassware, manufactured tobacco, and fertilizers,” the report reads.
However, the September monthly economic review highlighted that, the value non-traditional exports increased by 48.5 per cent to USD 532.9 million in August 2019, driven by minerals, particularly gold, manufactured goods, and horticultural products.
On the side of the mark, the report denotes that: traditional goods exports declined to $563.5 million in the year ending September 2019 from $1.16 billion in the corresponding period in 2018, as all traditional goods declined, except for coffee and tea.
“Cashew nuts exports, in particular, decreased owing to a fall in prices in the world market and volume due to delays in exporting after government intervention to safeguard farmers’ earnings. It is estimated that about 90,000 tonnes of cashew nuts stock for the 2018/19 crop-season were exported in August and September 2019. Exports of coffee and tea improved, supported by favorable weather conditions,” the reports denote.
Patently, the report also cast an analysis on the exports, whereby–gold and manufacturing goods exports performed rather well compared to the past two years. Foreign exchange earnings from services amounted to $4.1 billion in year ending September 2019 compared with $3.9 billion in the corresponding period in 2018, largely driven by tourism.
Further tourism accounted for 61.8 per cent of service receipts and grew by 9.9 per cent, which is equivalent to $2.5 billion, owing to the increase in tourist arrivals. Service receipts accounted for 45.6 per cent of total export of goods and services.
The reports show that Tanzania took a rather substantial rise in imports, the increase in imports was attributed by capital and intermediate goods particularly oil. Hence, the reports state that: imports of goods and services increased to over $10.9 billion in the year ending September 2019, from over $10.1 billion in the corresponding end of year in 2018.
The rise of imports on the latter is shown to have emanated from capital goods, which mostly falls under the demand from infrastructure projects undergoing in Tanzania, which rose to 21.6 per cent, equivalent to over $3 billion, while oil imports rose by 15.8 per cent (and accounted for 22.5 per cent of goods imports) which is equivalent to around $2.15 billion.
“Services payments fell by 10.1 percent to USD 1,987.9 million in the year to September 2019, mainly on account of a decline in travel payments. Foreign payments for transport services, particularly freight, increased by 18.8 percent to USD 986.2 million in line with the increase in goods import,” the report depicted.
At present Tanzania is one of leading East Africa’s nations with the fastest growing economy, thus—the current government has been cementing its efforts to revolutionize Tanzania’s industrial economy to attain a decent mid-sized economy.
Source: The Exchange