THE current account deficit has narrowed by almost half on an account of export increase and import decrease for the year ending January, this year.
The Bank of Tanzania (BoT) said current account narrowed to a deficit of 1.79 billion US dollars down by almost half from a deficit of 3.80 billion US dollars in the corresponding period in 2016.
“The reduction in the deficit was on account of an increase in export and a decrease in imports,” BoT said in its latest Monthly Economic Review of February. During the year ending January, exports of goods and services increased by 5.1 per cent from the corresponding period in 2016 to USD 9,342.1 million.
“The improvement occurred in exports of gold, traditional crops and travel receipts,” the report read. Revenue from export of traditional crops increased to 941.9 million US dollars from 768.5 million US dollars in the year ending January 2016.
“This was mostly contributed by an increase in export volumes and prices of cotton, tobacco and cashewnuts,” the report indicated. By contrast, the report indicated, export values of coffee, sisal, tea and cloves declined.
The decline in coffee export was manifested in price, as volume increased. On the other hand the value of sisal and tea declined on account of a fall in volumes. Cloves export fell on account of a drop in both volume and price. On the other hand nontraditional exports grew by 4.1 per cent on year-on-year to 4.28 billion US dollars in January, despite declining of manufacturing goods revenue.
On the other hand, export of manufactured goods declined to 1.07 billion US dollars from 1.32 billion in the year ending January 2016.
“Items that declined include edible oil and iron and steel products,” BoT said. While export revenue increased import of goods and services went down by 15.3 per cent to 10.49 billion US dollars in the year ending January.
“All the categories of goods import declined, except for industrial raw materials,” central bank report said.
During the year ending January 2017, the overall balance of payments was a surplus of 367.0 million US dollars compared to a deficit of 422.4 million US dollars in the corresponding period in 2016.