Manufacturers have been asked to put emphasis on the production of goods of high demand to reduce imports as well as use of scarce foreign currencies.
According to the Central Bank, the imports of goods and services increased to 16,796.5 million US dollars in the year ending July from 14,298 million in the previous year.
The main drivers of the rise include machinery, white petroleum products, industrial transport equipment, fertilizers and service payments, particularly freight payments.
The Ministry of Finance Minister, Dr Mwigulu Nchemba told the Confederation of Tanzania Industry (CTI) recently at the Public-Private dialogue on scarcity of US dollars in the market and its impact on the manufacturing sector in Tanzania that the government can reduce the pressure on finding US dollars for imports goods if the adequate products are produced in the country.
“We urge manufacturers to increase the production goods to be self-sufficient as well as exports more to boost export earnings,” said Dr Nchemba.
Dr Nchemba assured CTI that the government still had enough dollars compared to other East Africa countries.
“So far we are still better than many of our neighbouring countries since we have enough reserves,” he said.
He urged manufacturers to stop looking at the central bank policy of disbursing dollars as a solution to the problems.
He said it is an unusual approach for the central bank to intervene through issuing dollars to the economy rather than the sustainable economy which involves economic activities itself to finance the movement of dollars in the economy.
“We are looking forward to injecting dollars through various economic activities which will restore the situation as it concerns the availability of forex,” he said.
Similarly, the process of issuing licences to people who want to start engaging in forex business is continuing where almost 80 licences have been presented to traders since the process resumed, inviting more others to apply in accordance with the new licensing conditions.
Dr Nchemba said that they focus more on production activities to ensure the huge export to bring US dollars to the country.
He said the shortage of US dollars is a temporary issue which will be solved soon and asked those hiding dollars to release them.
The CTI Chairman Mr Paul Makanza said the shortage of US dollars is a complex issue with economic implications to address short term measures and long-term structural reforms.
CTI advised the government in collaboration with key stakeholders to have transparency and accountability which will be vital, achieving sustained progress and assuring the stability and resilience of Tanzania economy.
Another suggestion is to ensure that the available dollars are used on priority, especially on export industries.
Mr Makanza urged Tanzanians to use the products produced in the country to slow down the use of dollars in buying products from abroad.