Transport propels services earnings growth

DAR ES SALAAM: TRANSPORT earnings contributed about 66 per cent of the growth in services receipts in the year ending June this year, making the sector the biggest driver of the country’s expanding foreign-exchange income.

According to the latest Bank of Tanzania Monthly Economic Review, total services receipts rose by 981.5 million US dollars, or 13.7 per cent, to 8.14 billion US dollars from 7.16 billion US dollars a year earlier, with transport accounting for 650 million US dollars, equivalent to about 66 per cent of the increase.

Transport receipts rose 25.1 per cent to 3.23 billion US dollars from 2.58 billion US dollars, adding 650 million US dollars to total services earnings.

The performance marks a growing shift in services earnings, with transport expanding more than three times as fast as travel, which remains the country’s largest source of services income.

Travel receipts, which include tourism, increased 7.6 per cent to 4.41 billion US dollars from 4.10 billion US dollars in the year ending June 2025.

Despite its slower growth, travel remained the largest component of services receipts, accounting for more than half of total earnings and continuing to provide a major source of foreign exchange for the economy.

The faster expansion of transport earnings, however, is narrowing the gap between the two categories.

Transport receipts were equivalent to about 73 per cent of travel earnings in the year ending June 2026, compared with about 63 per cent a year earlier.

The shift highlights the increasing importance of transport and logistics in Tanzania’s services economy, as the country seeks to strengthen its position as a gateway to regional markets.

Tanzania’s transport corridors connect the country with several landlocked economies in East and Central Africa, providing opportunities to earn foreign exchange from transit, freight and other transport-related services.

The rise in transport receipts therefore adds another important source of foreign exchange alongside tourism and merchandise exports, potentially reducing reliance on a narrower group of external earning sectors.

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Receipts from other services increased by about 5 per cent to 504.5 million US dollars from 480.6 million US dollars, making a relatively small contribution to the overall increase.

The latest figures extend a broader upward trend in Tanzania’s services earnings.

Total receipts increased from 6.31 billion US dollars in the year ending June 2024 to 7.16 billion US dollars in 2025 before reaching 8.14 billion US dollars in 2026.

The nearly 1 billion US dollar increase in services receipts over the latest year strengthens the sector’s role in Tanzania’s external position, providing additional foreign exchange inflows to support the economy’s import requirements.

For policymakers and businesses, the trend highlights the growing economic importance of transport and logistics alongside tourism, particularly as Tanzania seeks to capture a larger share of regional trade and related services.

With transport generating about two-thirds of the latest increase in services receipts, the sector is emerging as a key engine of Tanzania’s foreign exchange earnings growth.