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Tanzania needs no IMF support
2007-05-02 10:04:49
By Pastory Nguvu
Tanzania no longer needs financial support from the International Monetary Fund, IMF Deputy Managing Director Murilo Portugal has said.
Speaking at a press conference on Monday evening, Portugal said with the achievements Tanzania has recorded in improving its economy; it can stand on its own without any financial support from the IMF.
Portugal, who had been in the country for an official visit, met President Jakaya Kikwete and his economic team, including the Finance Minister Zakia Meghji, Bank of Tanzania Governor Daudi Ballali, and other senior government officials.
He also met with parliamentarians and representatives of the donor community.
Portugal said that during his meeting with Kikwete, he had commended the country`s economic performance.
Portugal said Tanzania had achieved strong growth and low inflation through macroeconomic policies in the past few years.
He added that the external position had strengthened in recent years, and debt relief reduced Tanzania’s external debt burden.
``We also discussed the next phase of Tanzania`s relationship with the IMF-through the Policy Support Instrument (PSI).
The PSI is an acknowledgement of Tanzania`s strong record of macroeconomic performance and that the essential economic policy-making capacity is in place.
Moreover, Tanzania no longer needs financial support from IMF. This is quite an achievement,`` said Portugal.
He said the role of the Fund in this phase is to continue supporting Tanzania`s development of a sound macroeconomic policy framework and to encourage reforms in areas that are critical to securing higher and more sustainable growth.
He said the Fund`s periodic assessment of those efforts might be used by private sector, the donor community and others to make judgment about progress being made.
``I expressed the Fund`s strong support for the overall direction of the policies being pursued, but noted that much remains to be done for Tanzania to make greater inroads in reducing poverty and raising living standards.
``In our discussions, we agreed that main challenge now for Tanzania is to seize the opportunity provided by macroeconomic stability and debt relief and to sustain, and indeed deepen, the progress achieved in recent years,`` he said, adding that stress should be put in creating business environment conducive to private investment.
He said that meant removing bottle-necks that prevented the efficient operation of the private sector; upgrading infrastructure electricity and transportation networks and simplifying business regulation.
He said structural reforms, including in the areas of governance, tax administration, and in the financial sector, were critical in supporting macroeconomic stability and growth.
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