TANZANIA’S external sector has shown remarkable improvement, driven by strong export growth and slowed import costs, as the global economy continues its recovery.
The Bank of Tanzania (BoT) latest monthly economic review for August shows that the favourable global commodity prices have played a key role in boosting the country’s trade balance, signalling a positive outlook for economic growth.
Thus, the current account deficit narrowed to 2.56 billion US dollars in the period ending August from 3.84 billion US dollars in the corresponding period last year.
The exports of goods and services surged to 15.06 billion US dollars in the year ending August up from 13.29 billion US dollars in the same period last year.
“The growth was largely driven by higher service receipts, particularly from tourism, increased exports of gold and traditional goods including tobacco, cashew nuts and horticultural products,” Bank report stated.
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Traditional exports amounted to 1.09 billion US dollars during the year ending August higher than 807.9 million US dollars in the previous year.
Much of the increase was recorded in the exports of tobacco and cashew nuts, on account of both volume and price effects.
Non-traditional exports were 6.56 billion US dollars compared with 6.34 billion US dollars with the increase largely driven by gold exports which rose by 8.2 per cent from a similar period in the preceding year to 3.18 billion US dollars largely explained by volume and price effects.
Horticultural products increased by 35.3 per cent to 454.4 million US dollars backed by higher shipments of edible vegetables.
On a monthly basis, exports of goods amounted to 934.3 million US dollars in August compared to 785.3 million US dollars in August last year.
Service receipts surged to 6.94 billion US dollars in the year ending August from 5.71 billion US dollars in the previous year, largely driven by travel (tourism) and transport services.
The increase in travel receipts reflects the sustained good performance of the tourism sector, with tourist arrivals increasing by 21.7 per cent to 2,051,404.
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Transport earnings, primarily freight charges, amounted to 2.59 billion US dollars up from 2.18 billion US dollars. On a monthly basis, service receipts were 663.2 million US dollars in August this year compared with 694 million US dollars in August last year.
Looking ahead, the BoT remains optimistic about maintaining this growth trajectory, emphasising the importance of diversifying export products and expanding into new markets.
By capitalising on the positive trends in the global economy, Tanzania aims to bolster its external sector further, ensuring sustained economic resilience and development for its citizens.
