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| BoT HQ in Dar |
Credit to the private sector grew by
18.7 per cent up to June this year, down from 25.6 per cent recorded in
the corresponding period of 2011, largely due to uncertainties of some
economic variables.
According to the Bank of Tanzania (BoT)
monthly economic review for the year ending June this year, major
economic activities recorded slow growth in credit in the year in the
period under review, save for some sectors like building and
construction.
During the period, the economy passed through
hardships like power blackouts, high inflation and foreign exchange
volatility which led to liquidity tightening.
"Building and construction
grew 51.6 per cent, up from 44.6 per cent recorded in the corresponding
period of 2011 in line with increased activities," stated the report.
In terms of shares to banks' credit to the private sector, trade activities accounted for the largest share by 21.4 per cent, followed by personal by 21.3 per cent, manufacturing by 10.9 per cent and agriculture by 10.6 per cent.
In terms of shares to banks' credit to the private sector, trade activities accounted for the largest share by 21.4 per cent, followed by personal by 21.3 per cent, manufacturing by 10.9 per cent and agriculture by 10.6 per cent.
In the meantime, annual growth of extended
broad money supply decelerated to 11.8 per cent in June 2012 from 22
per cent recorded in the corresponding period of the previous period,
and 12.7 per cent recorded in May this year.
This outturn stated the report, was explained by the slowdown in the growth of Net Foreign Assets (NFA) and Net Domestic Assets (NDA) of the banking system.
This outturn stated the report, was explained by the slowdown in the growth of Net Foreign Assets (NFA) and Net Domestic Assets (NDA) of the banking system.
The
NFA of the banking system recorded a growth rate of 3.6 per cent during
the twelve months to June 2012, lower than the growth rate of 10.6 per
cent in the corresponding period in the preceding year.
The slow growth in the NFA of the banking system was mostly driven by low disbursements of foreign programme assistance, coupled with an increase in demand for foreign exchange to support high import requirements.
The slow growth in the NFA of the banking system was mostly driven by low disbursements of foreign programme assistance, coupled with an increase in demand for foreign exchange to support high import requirements.
Likewise, NDA of the banking system grew by 19.6 per cent in the year
ending June 2012 compared to 35.6 per cent recorded in the corresponding
period in 2011.
The outturn was attributed to the slowdown in the growth of credit to the government and private sector. The net credit to the government was 69.5bn/- in the year ending June 2012, compared to 906.8bn/- recorded in the corresponding period in 2011.
The development was mostly explained by improved government revenue collections efforts and expenditure management coupled with the slowdown in banks' holdings of government securities.
The outturn was attributed to the slowdown in the growth of credit to the government and private sector. The net credit to the government was 69.5bn/- in the year ending June 2012, compared to 906.8bn/- recorded in the corresponding period in 2011.
The development was mostly explained by improved government revenue collections efforts and expenditure management coupled with the slowdown in banks' holdings of government securities.
During the period under
review, all components of the extended broad money supply recorded a
slowdown in annual growth rates compared to a similar period in 2011,
except for transferable deposits.
These deposits grew 30.5 per cent in period under review, compared to 25.3 per cent recorded in May 2012 and 16.0 per cent in the corresponding period of 2011, mainly on account of sizeable government payments in favour of infrastructure projects.
These deposits grew 30.5 per cent in period under review, compared to 25.3 per cent recorded in May 2012 and 16.0 per cent in the corresponding period of 2011, mainly on account of sizeable government payments in favour of infrastructure projects.
Meanwhile, the share of all components of M3 remained broadly the same.\
Source: The Daily News,http://www.dailynews.co.tz
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