Current account deficit on downward trend

DAR ES SALAAM: THE current account deficit declined to 2,903 million US dollars in the period ending December last year compared with 5,160.6 million US dollars in the preceding year on account of increased earnings from tourism activities and traditional exports.

“The current account deficit remained large, though has been narrowing gradually in recent months,” the Bank of Tanzania said in its monthly economic review for December last year.

According to the report, service receipts increased to 6,158.6 million US dollars in the year ending last November from 4,641.8 million US dollars in the corresponding period in 2022 driven by travel (tourism) and transport receipts.

The surge in travel receipts reflects the rebound of the tourism sector as tourist arrivals rose by 27 per cent to 1,797,347.

On a month-to-month basis, service receipts were 531.7 million US dollars in last November compared with 414.1 million US dollars in a similar period in 2022.

The export of goods and services increased by 17.8 per cent to 13,949 million US dollars in the year ending last November largely contributed by receipts from tourism and traditional and non-traditional exports.

The export of non-traditional goods grew by 5.8 per cent to 6,389.0 million US dollars with much of the increase driven by gold.

The exports of gold rose to 3,034.5 million US dollars compared with 2,822.4 million US dollars on account of both volume and price effects.

The improvement was also registered in exports of oil seeds and horticulture, particularly vegetables.

The export of traditional goods edged up to 969.1 million US dollars from 760.9 million US dollars largely driven by coffee and tobacco.

On a monthly basis, the export of traditional goods almost doubled to 185.3 million US dollars in last November compared to 126.5 million US dollars recorded in a similar month in 2022.

Meanwhile, non-traditional exports rose to 511.1 million US dollars from 488.4 million US dollars.

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