BoT governor Prof Benno Ndulu at a past event. Tanzania’s current account deficit narrowed by 22 per cent during the year to January 2013. PHOTO | FILE
By Alawi Masare
The Citizen Reporter
Dar es Salaam. The current account deficit -- a result of importing more in terms of goods, services and transfers than exporting the same -- has narrowed by 21.9 per cent, the Bank of Tanzania has reported.
The BoT said there was an increase in export of goods and services resulting in the contraction of the current account deficit to $3.37 billion in the year ending January 2013 compared to a deficit of $4.31 billion recorded in the corresponding period in 2012.
The central bank’s February Economic Review shows that the overall balance of payment recorded a surplus of $313.8 million compared to a deficit of $371.0 million recorded in the year ending January 2012.
“Net increase in inflows in the form of capital grants, foreign direct investment and foreign borrowing contributed towards the improvement of the overall balance of payment position,” reads the BoT report in part.
Gross official reserves stood at $3.88 billion at the end of January 2013, sufficient to cover 3.7 months of import of goods and services. Gross foreign assets of banks stood at $880.1 million in the same period.
The value of export of goods and services amounted to $8.69 billion during the year ending January 2013 compared to $7.37 billion registered a year earlier due to an increase in receipts from travel, traditional and manufactured exports.
The value of traditional exports increased by 50.8 per cent to $963.9 million largely on account of a remarkable increase in the export volumes of coffee, cotton, tobacco and cashews associated with good weather conditions.
The value of non-traditional exports increased by 15.8 per cent to $4.34 billion on account of improved performance of manufactured goods, re-exports and other exports.
The value of manufactured goods increased by 20.7 per cent to $1.06 billion compared to a decline of about 12 per cent recorded in the preceding year.
Likewise, the value of re-exports increased to $184.0 million from $102.5 million recorded during the year ending January 2012, the report showed.
Services receipt increased from $2.32 billion in 2012 to $2.66 billion in the year ending January 2013 largely explained by travel and transportation receipts, accounting for over 80 per cent of services receipt. The good performance in travel receipts is mostly associated with an increase in international tourist arrivals.
The value of imports of goods and services increased by 2.4 per cent compared to an increase of 34.9 per cent in the preceding year while the value of intermediate goods remained almost unchanged at $4.31 billion compared to $4.29 billion following stabilisation of oil imports which accounted for over 70 per cent of intermediate goods.
Development was mainly explained by a decline in volume of oil imports as average prices of oil in the world market increased.
http://thecitizen.co.tz/business/-/29659-govt-external-borrowing-declines-by-22pc-says-bot
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