The World Bank (WB) on Wednesday urged Tanzania to take bold policy actions to maintain the east African nation’s lower-middle income status in the post COVID-19 era.
“Realizing the goals of Tanzania’s Development Vision 2025 will require a concerted effort to restore the economy’s growth momentum while expanding access to economic opportunities,” said Mara Warwick, World Bank’s Country Director for Tanzania, Malawi, Zambia and Zimbabwe.
Warwick was speaking at the launch of the World Bank’s 15th Tanzania Economic Update which observed that the global COVID-19 pandemic has significantly slowed economic growth, adversely affecting lives and livelihoods of Tanzanians.
Following two decades of sustained growth, Tanzania reached an important milestone in July 2020, when it formally graduated to the lower-middle-income country status.
“Tanzania’s sustained economic expansion in recent years has supported improvements in overall living standards,” said Warwick.
“However, there is an important opportunity for the country to raise its own bar, providing greater opportunities and economic security for the large proportion of Tanzanians still living in poverty amidst serious impacts from the global COVID-19 pandemic,” she said.
The economic update launched in the commercial capital Dar es Salaam noted that while Tanzania avoided a recession in 2020, economic growth decelerated to an estimated two percent.
The update said the poverty rate was estimated to have risen to 27.2 percent, warning that the loss of income could have pushed an additional 600,000 Tanzanians below the national poverty line, most of which are households relying on self-employment and informal micro-enterprises in urban areas.
The economic update also highlights the uncertainty of the country’s economic outlook.
According to the update, real gross domestic product was projected to grow in 2021 in the range of three percent to 5.3 percent, with realization on the upper side of this range hinging on a strong recovery in global economic activity supported by the world-wide rollout of COVID-19 vaccines, and sound domestic policies to foster a sustainable recovery.