BoT: Imports surge driven by industrial demand
DAR ES SALAAM: IMPORTS of goods and services rose to 17.69 billion US dollars in the year ending May, up from 16.14 billion US dollars the previous year, driven mainly by increased imports of industrial transport equipment, raw materials and freight payments.
The latest Bank of Tanzania (BoT) monthly economic review indicates that higher imports of industrial transport equipment and raw materials reflect expanding infrastructure and manufacturing sectors, potentially boosting job creation and supply chains.
Additionally, increased freight payments highlight greater trade volumes and connectivity with international markets, which are crucial for sustaining economic development.
However, this trend also calls for careful monitoring of trade balances and policies to ensure sustainable growth and avoid excessive dependence on imports.
However, on a month-to-month basis, imports of goods declined slightly to 1.22 billion US dollars in May this year compared to 1.24 billion US dollars in May last year. In the year ending May service payments rose by 27.0 per cent to 2.84 billion US dollars up from 2.32 billion US dollars in the corresponding period last year.
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The increase was mainly driven by freight payments, which accounted for 47.7 per cent of total service-related expenditures.
On a monthly basis, service payments reached 247.6 million US dollars in May this year compared to 189.3 million US dollars in May last year.
The primary income account deficit widened to 1.98 billion US dollars in the year ending May this year up from 1.63 billion US dollars recorded in the same period last year.
The increase was largely driven by higher payments of income on equity and interest to non-residents. However, on a monthly basis, the deficit narrowed to 184.5 million US dollars in May this year from 145.6 million US dollars in May last year.
The secondary income account recorded a surplus of 554.0 million US dollars compared with 649.7 million US dollars in the year ending May last year largely due to a decline in personal transfers.
On a monthly basis, the surplus amounted to 31.4 million US dollars in May this year compared with 38.3 million US dollars in May last year.
