During the year ending April 2021, credit to the private sector grew by an average of 4.8 percent compared to 5.8 percent in the same period 2020, which is a one percent decline. The decline is due to adverse effects of Covid-19.
Minister for Finance and Planning Dr Mwigulu Nchemba said this when presenting the state of the economy and national development plan.
The minister said during the same period a large portion of the credit to the private sector was directed to personal activities which accounted for 35.8 percent, followed by business activities 15.7 percent, manufacturing 10.1 percent and agriculture activities 8.0 percent.
“Capital formation at current prices reached 59.2trn/- shillings in 2020 compared to 55.8trn/- in 2019, equivalent to a growth of 6.2 percent,” the minister said.
The minister said fixed assets increased by 7.8-percent from 59.4 trn/- in 2019 to 64.0 trn/- in 2020. Further, the value of capital accumulation at current prices decreased by 4.8trn/- in 2020 compared to a decrease of 3.7trn/- in 2019.
He said in 2020, public sector capital formation at current prices reached 19.0 trn/-while private sector capital formation reached 45.0 trn/- equivalent to a growth of 7.8 percent respectively.
The minister said during the year ending April 2021, the value of exports of goods and services was $8.5 billion compared to $9.6 billion during the same period in 2020.
He attributed the decline of revenue from tourism related activities due to measures against the spread of COVID – 19.
Further, the minister said export value for goods and services decreased to $9.3 billion from $10.5 billion during the same period in 2020.
The minister said during the year ending April 2021, the value of export of goods increased to $6.35 billion from $5.67 billion during the same period in 2020, and equivalent to 12.0percent.
According to the minister, this was due to increased exports of traditional and non-traditional products including gold, other minerals, horticultural products as well as manufactured goods.
In addition, the minister said the value of imports decreased from $8.75 billion during the year ending April 2020 to $8.11 billion April 2021, equivalent to a decrease of 7.4 percent.
“This was caused by a decrease in imports of some goods ascribed to improved production in domestic industries including construction materials,” he said.
The minister said foreign currency reserves have continued to remain at sufficient levels to meet the demand for imports of goods and services.
“As of April 2021, foreign reserves were $4.97 billion sufficient to cover 5.8 months of imports of goods and services,” he said adding this amount is higher than the country's threshold set of at least 4.0 months and is above the 4.5 months threshold by the Member States of the East African Community.”