Mining credit rebounds 91pc amid modernisation
DAR ES SALAAM: CREDIT to mining and quarrying surged 91.4 per cent in the period ending February, a sharp rebound from the 30.6 per cent decline in the same period last year, driven by government efforts to modernise the sector.
The latest Bank of Tanzania Monthly Economic Review shows that, in addition to government efforts to modernise the mining sector also access to credit for artisanal and small-scale miners was boosted through flexible collateral arrangements.
By reducing financial barriers through flexible collateral, these measures not only support individual livelihoods but also contribute to the growth and formalisation of the mining sector, boosting overall economic development and creating more employment opportunities.
During the period, annual credit growth to the trade sector surged to 50 per cent up from just 5 per cent in the same period last year.
The annual credit growth extended to transport and communication sectors were 34.2 per cent compared to 14.8 per cent in the year before.
On the other hand, credit to manufacturing activities decreased negative 7.7 per cent for the second month in row compared to 18.0 per cent of the corresponding period owing to net repayment of previously issued loans.
During the period under review, building and construction attracted annual credit growth of 29.5 per cent compared to 19.0 per cent of the year before.
Personal loans, primarily used to finance micro, small and mediumsized enterprises, remained the largest share of private sector credit, accounting for 35.6 per cent, followed by trade (14.9 per cent) and agriculture (13.1 per cent).
The monetary aggregates continued to register robust growth, in line with the prevailing stance.
Specifically, extended broad money grew by 26.3 per cent in January this year compared with 25.8 per cent recorded in the preceding month, driven mainly by sustained robust private sector credit growth.
Credit extended to the private sector grew by 23.5 per cent, remaining broadly unchanged from the rate recorded in the preceding month.
