Tanzania’s current account deficit widens by 2%

Tanzania's current account deficit widened by 2.1 per cent in the year to October despite an increase in exports, after the country received less aid and fewer loans, the Bank of Tanzania (BoT) said.

The current account deficit expanded to $4.683 billion in the year to October from $4.588 billion in the same period last year.

“The widening of the deficit was driven by a fall in inflows of official current transfers, particularly those under the programme grants,” the Bank of Tanzania said in its latest monthly economic report.

For the first 10 months of 2014, “the overall balance of payments registered a deficit of $380.5 million compared with a surplus of $546.7 million recorded in the year ending October 2013,” said the central bank.

Total exports of goods and services rose 3.3 per cent to $8.6 billion, while the country’s import bill for goods and services rose 1.3 per cent to $13.445 billion.

Tourism, the country’s top foreign exchange earner, fetched $1.96 billion in the year to October from $1.79 billion previously. The rise was due to more visitors arriving.

Gold export earnings continued to slide, falling to $1.35 billion from $1.74 billion previously on lower output and declining world prices. Tanzania is the continent’s fourth-largest gold producer after South Africa, Ghana and Mali.

Gross official foreign exchange reserves held by the central bank fell to $4.26 billion in the year to October, or about four months of import cover, from $4.65 billion a year ago.
Source: Daily News, reported from Dar es Salaam, Tanzania
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