Tanzania's current account deficit narrows 11 pct in year to Nov
Sat Jan 31, 2015
Tanzania's current account deficit narrowed 11 percent in the year to November despite a sharp fall in gold exports as declining crude oil prices curbed the import bill, its central bank said on Friday.
The gap narrowed to $4.755 billion in the 12 months to November from $5.342 billion in the same period in 2013, the Bank of Tanzania said in its latest monthly economic report.
'Meanwhile, current transfers inflows declined substantially, albeit with limited impact on the overall current account balance,' the central bank said in the report. Current transfers comprise aid and loans.
Tanzania is one of Africa's biggest per-capita aid recipients.
A group of international donors said in October they will only pay outstanding pledges of budget support worth nearly $500 million to the aid-reliant nation if the government took appropriate action against graft allegations in the energy sector.
Current transfers fell to $513.1 million in the year to November, a 35.1 percent drop from $790.5 million previously.
The bank said overall balance of payments swung into a deficit of $259.9 million from a surplus of $538.4 million in the year ending November 2013.
Earnings from tourism, the main foreign exchange source, rose to $1.93 billion from $1.85 billion previously due to more visitor arrivals.
Imports of goods and services were $13.347 billion, a 6.1 percent decline from a year before, helped by falling global oil prices and lower machinery imports.
Earnings from gold, the other main source of foreign income, continued a downward spiral, falling 32.45 percent to $1.29 billion, reflecting lower export volumes and global prices.
Tanzania, which has a population of around 45 million, is Africa's fourth-largest gold producer after South Africa, Ghana and Mali.
The value of traditional exports - such as tobacco, cotton and coffee - fell to $785.1 million from $867.1 million previously due to a decline in export volumes and prices.
Gross official foreign exchange reserves held by the central bank fell to $4.25 billion in the year to November, or about four months of import cover, from $4.538 billion a year ago.
SOURCE: IPPMEDIA
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