Dar economy sees strong growth 

THE economy is expected to grow stronger this year compared to last year, as tourism recovers and global supply chain continues to stabilise, the Finance and Planning Minister, Mwigulu Nchemba has said.

Presenting the state of the economy for 2023 in the National Assembly on Thursday , the minister said the economy was expected to expand by about 5.2 per cent in 2023 from 4.7 per cent recorded last year, driven by the sustained recovery in tourism and gradual stability in supply and value chains.

Growth slowed to 4.7 per cent in 2022 from 4.9 per cent in 2021 due in part to the impact of the war in Ukraine that sent commodity prices, notably on food and energy, soaring.

Dr Nchemba said in 2022 Tanzania’s GDP value in current prices reached 171.3tri/- (equivalent to 77.6 billion US dollars) compared to 156.4tri/- (69.94 billion US dollars) in 2021.

And, basing on the 2022 Population and Housing Census where the population of Tanzania Mainland reached 59.9 million, GDP per capita increased to 2,844,641/- equivalent to 1,229.1 US dollars in 2022 up from 2,708,999/- equivalent to 1,173.3 US dollars in 2021 to make Tanzania remain in the lower middle-income status.

The minister said the public debt has continued to increase but remained within sustainability thresholds that are internationally acceptable during short, medium and long term.

Up to April 2023, the public debt stock as at April 2023 reached 79.1tri/-, which is equivalent to 13.9 per cent increase compared to 69.44tri/- for a corresponding period last year. The amount includes foreign debt of 51.16tri/- and domestic debt of 27.93tri/-.

The increase in the debt levels is due to new debts acquired to finance various development projects including road, railway, airport, energy education and health infrastructure.

Dr Nchemba said the government would put up measures to contain inflation to a single digit of the average of between 3.0 per cent and 7.0 per cent in the medium term.

The government has projected domestic revenue to reach 14.9 per cent of the GDP in 2023/24, up from 14.4 in the current financial year, he said, adding that tax revenue collections are projected to reach 12 per cent of the total economy up from projections of 11.5 for the current financial year.

The minister said the budget deficit will be contained below 3.0 per cent of the GDP and foreign reserves will be maintained to be sufficient to cover at least four months of imports of goods and services.

Dr Nchemba said the government would continue with measures to promote participation of the private sector in investments and business and will continue to put up measures to cushion the economy from the impact of natural and non-natural disasters.

The government will contain the impacts of declining global economic growth and increase of commodity service prices in the global market, he added.

Other targets for the next financial year include continued stability of food sufficiency in the country and maintenance of peace, security, unity and tranquility and continued improvement in indicators of well-being of society.

The government would prioritise implementation of flagship projects, which include construction of a standard gauge railway in remaining lots as the 300-kilometre Dar es Salaam – Morogoro section nears completion.

Other flagship projects to be prioritized are construction of Julius Nyerere Hydroelectric Power station, which is expected, generates 2115 megawatts of electricity and the government will continue improving the state-owned airline, ATCL with fleet modernization.

He said the government would also proceed with final preparations for investments in the long-delayed 40 billion US dollar Liquefied Natural Gas (LNG) plant project in Lindi Region for export after concluding negotiations with the international energy consortium in May to pave the way for signing of final agreements.

The consortium, led by Equinor, Shell and Exxon Mobil, wants to develop an onshore LNG plant south of Tanzania, close to huge offshore gas fields.

Other flagship projects include construction of hydroelectric generation stations at Ruhudji (MW 358), and Rumakali (MW 222) in Njombe, Kigongo – Busisi Bridge in Mwanza, road and bridge constructions.

The government plans to develop special economic zones, including a special investment area in Bagamoyo, Coast Region.

Related Articles

Back to top button