Tanzania’s current account deficit narrows to $3.26 billion in October 2023

Tanzania’s current account deficit narrowed to $3.26 billion in October 2023, compared with $4.99 billion recorded the preceding year attributed to increased seasonal earnings from tourism activities and traditional exports, the Central Bank said.

According to the Bank of Tanzania (BoT) Monthly Economic Review for November 2023, external shocks continued to exert pressure on the current account position, foreign reserves, and exchange rate.

Tanzania’s foreign exchange reserves stock however fell to $4.61 billion in October 2023 as compared with 4.63 billion recorded at the end of October 2022.

“Despite the decrease, reserves were adequate to cover about 4.0 months of projected imports of goods and services,” the report shows.

Meanwhile, the value of Imports of goods and services increased to $16.17 billion in October 2023, higher than $16.06 billion that was recorded in the previous year, with the main drivers being machinery, industrial transport equipment, motorcars for household and fertilizers.

Import of refined white petroleum products, which accounted for 19.7 percent of the total imports bill of goods, fell by 16 percent, resulting from both price and volume.

“On a monthly basis, goods worth $1.305 billion were imported compared to $1.27 billion in October

2022,” the report shows.

Services payments also rose to $2.416 billion in October 2023 from $2.32 billion recorded inOctober 2022, largely attributed to freight payments consistent with a rise in import bill.

“On a monthly basis, service payments fell by 6.7 percent to $215.2 million in October 2023, compared with $230.6 million recorded in October 2022,” the report shows.