Car imports soar by 70 per cent, rise oil bill

Car imports soar by 70 per cent, rise oil bill

Tanzania Revenue Authority (TRA) data shows that 93,009 vehicles of different categories  - buses, heavy duty trucks, light trucks, min buses and saloons - were registered by the end of last year compared to 55,144 in the previous year.

The data, excluding government, police, army and donor funded vehicles, shows that 67 per cent of registered vehicles in a single year were light passenger vehicles with carrying capacity of less than 12 passengers - the saloon cars.

Mzumbe University's Dar es Salaam Business School Senior Economists, Dr Honest Ngowi described the data as the reflection of increased middle class in the country. "The data quickly tells us that the consumption pattern has shifted from basic needs to luxurious goods, and it is simply the emergence of the middle class," Dr Ngowi told the 'Daily News' on Wednesday.

Between 1980s and 1990s owning a car was considered luxurious but economic liberalisation now has enabled many people to shift from basic needs to luxurious assets through saving or borrowing. "The boom has also its positive and negative effects...it brings about congestions in cities, especially in Dar es Salaam and Arusha where the road expansions are not correlated to the influx of cars," Dr Ngowi said. It is estimated that about 70 per cent of saloon cars are in Dar es Salaam and Arusha.

He said the positive side is that it increases revenues, should all taxes be collected accordingly. But effort to get data on revenue collected from increased vehicles on the road failed, with questions sent to TRA not being answered.

The more vehicles also mean that the country has to spend more on oil bill to keep the cars running. The Bank of Tanzania (BoT) says for the year ending last October, 2011, the oil bill increased by almost 44 per cent from 1.97 billion US dollars (over 3trn/-) to 2.84billion US dollars (over 4.5trn/-).

The central bank data indicate that the country's consumption per month has increased from 233.4 million US dollar to 261.4 million US dollars, equals to 12 per cent change between September and October last year. The Dar es Salaam Port receives an average of three million litres of petroleum products monthly, with 55 per cent of the consignment being for domestic market and the rest for the neighbouring countries.

In total TRA registered 235, 942 motor vehicles last year compared to 177,749 vehicles in 2010. The registration was mainly amplified by motor cycles, which were 129,448 last year compared to 115,732 of 2010.  The tricycle accounts for 5,383 and 2025 pieces in 2011 and 2010 respectively while tractors registration last year jumped to 2,430 from 1,481 units in 2010.

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