Account Deficit wider, Inflation up

h3. Current Account Deficit

p. Tanzania’s current account deficit widened 17.1 percent in the year to March on the back of increased oil import costs and lower aid receipts, its central bank said this week. The deficit widened to US$ 4.758 billion in the 12 month period. “The value of oil imports rose by 12.7 percent to $4.226 billion, due to an increase in volume as oil prices in the world market declined,” the Bank of Tanzania said in its latest monthly economic report. The total import bill for goods and services rose 6.6 % to US$ 13.87 billion, while the value of goods and services exported fell 1.7 % to US$ 8.709 billion.

p. Aid and grants to Tanzania, east Africa’s second largest economy but still one of the continent’s biggest per capita aid recipients, fell 12 % to US$ 754.4 million in the 12 months to March. Tourism earnings continued to outpace gold exports as the country’s top foreign exchange earner due to higher visitor arrivals, fetching US$ 1.93 billion, up from US$ 1.74 billion a year ago, while Gold exports fell to US$1.75 billion in March, down from US$ 1.97 billion a year ago, due to a decline in both export volumes and prices. Tanzania, which has a population of around 45 million, is Africa’s fourth-largest gold producer after South Africa, Ghana and Mali.

h3. Inflation Rate

p3. The inflation rate in Tanzania inched up to 6.5 % in the year to May from 6.3 % in April, the statistics office stated. “The rise of the annual inflation rate in May was caused by higher price increases in food and non-food items such as fuel,” said Ephraim Kwesigabo, a director at state-run National Bureau of Statistics (NBS).

p. The NBS said that month on month inflation slowed to 0.4 % from 0.7 % in April.

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