Tanzania’s 12-month current account gap shrinks 22.5% y/y at end-June

By bne IntelliNews August 12, 2015

Tanzania’s current account gap for the year to end-June narrowed by 22.5% y/y to $4.09bn on the back of rising exports and shrinking imports, the country’s central bank said in its latest monthly economic review.

Exports of goods and services grew 9.4% y/y to $9.4bn in the 12-month period, whereas imports fell 4.3% y/y to $13.37bn, resulting in a 26.1% contraction of the deficit on the goods and services account to $3.97bn.

Tourism remained the country’s main source of foreign exchange earnings, with travel receipts of $2.2bn, up 11.5% y/y on the back of growing number of tourist arrivals. Exports of manufactured products rose 14% y/y to $1.32bn and that of traditional exports, which include tobacco, coffee, cotton, cashew nuts, and tea, among others, increased 8.6% y/y to $907.7mn. On the other hand, the value of gold exports dropped 16.8% y/y to $1.23bn amid weak bullion prices and lower volumes.

The improvement in the trade and services balance was partly offset by a 7.2% expansion of the primary income deficit and a 22.7% contraction in the secondary income surplus. Inflows to the government, which comprise grants and loans, remained significantly lower y/y, reflecting smaller program grants from development partners. Tanzania is one of Africa's biggest per-capita aid recipients. A group of 12 international donors withheld in October 2014 budget support pledges worth nearly $500mn following a corruption scandal in the energy sector.

In June alone, Tanzania recorded a current account gap of $546.1mn, up 58% m/m, but down 13% y/y. The data suggests that some donors have restored budget support.

The Bank of Tanzania disclosed also that its gross official foreign exchange reserves widened 13.7% m/m to $4.4bn at end-June, sufficient to cover 4.2 months of projected imports of goods and services excluding those financed by foreign direct investment (3.7 month at end-May). At the same time, the gross foreign assets of banks stood at $1.04bn, up 4% from end-May.

$bn year to end-June 2015 year to end-June 2014 y/y change June 2015 May 2015 June 2014 June, m/m change June, y/y change
CURRENT ACCOUNT BALANCE -4 093.8 -5 281.2 -22.5% -475.8 -300.6 -546.1 58.3% -12.9%
Trade balance -4 944.7 -6 098.7 -18.9% -485.1 -344.9 -567.0 40.6% -14.4%
-exports of goods 5 714.7 5 248.4 8.9% 501.8 444.0 386.6 13.0% 29.8%
-imports of goods 10 659.5 11 347.1 -6.1% 987.0 788.8 953.6 25.1% 3.5%
Services balance 971.1 721.9 34.5% 61.7 65.9 38.3 -6.4% 60.8%
-receipts 3 681.8 3 340.9 10.2% 291.5 271.4 249.7 7.4% 16.7%
-payments 2 710.7 2 619.1 3.5% 229.8 205.5 211.4 11.8% 8.7%
Goods and services balance -3 973.6 -5 376.9 -26.1% -423.5 -279.0 -528.7 51.8% -19.9%
-exports 9 396.5 8 589.3 9.4% 793.3 715.4 636.3 10.9% 24.7%
-imports 13 370.1 13 966.2 -4.3% 1216.8 994.3 1165.0 22.4% 4.4%
Primary income balance -694.9 -648.1 7.2% -90.6 -44.9 -41.3 101.8% 119.4%
-receipts 121.3 123.7 -1.9% 9.0 6.9 10.6 30.4% -15.1%
-payments 816.1 771.9 5.7% 99.5 51.8 51.9 92.1% 91.7%
Secondary income balance 574.7 743.9 -22.7% 38.3 23.2 23.9 65.1% 60.3%
-inflows 650.8 800.0 -18.7% 41.8 29.4 29.1 42.2% 43.6%
--general government 289.9 439.0 -34.0% 12.7 0.1 0.0 12600% n.a.
-outflows 76.1 56.2 35.4% 3.6 6.2 5.2 -41.9% -30.8%
Source: Bank of Tanzania                

Related Articles

South Africa’s MTN fears sanctions may hinder profits repatriation from Iran

MTN Group, one of Africa’s biggest mobile operators, has said it will struggle to repatriate profits from its Iranian subsidiary MTN-Irancell if heavy sanctions are reimposed on Iran following ... more

Russia's Rosneft sets foot in Mediterranean with $1.125bn Eni deal

Russia's largest oil producer state-controlled Rosneft has acquired 30% in the largest natural gas field in the Mediterranean from Italian Eni, the company announced on October 9. Rosneft that ... more

PetroSA, Rosgeo sign $400mn oil and gas exploration agreement for South Africa

South Africa's national oil company PetroSA and Rosgeo, the geological exploration company of the Russian Federation, have signed an agreement on a $400mn oil and gas development project in South ... more

Dismiss