THE Current account deficit narrowed by nearly 45 percent to US$2.7 billion during the year ending February 2024, compared to US$5.1 billion recorded in February 2023, thanks to increased exports, moderated global commodity prices and decline of imports bill.

According to the Bank of Tanzania (BoT) monthly economic review for March, in the year ending February 2024, exports of goods and services rose by 14.7 percent, reaching US$14,274 million compared with the level recorded inthe corresponding period in 2023. 

The main drivers included tourism receipts, traditional goods and minerals, specifically gold.

Traditional goods exports amounted to US$ 1,022.7 million, from US$748.7 million in the previous year, with much of the increase observed in exports of tobacco and coffee on account of volume and price effects. 

According to the global market reports, prices of agricultural products have also exhibited a mixed trend, with coffee, cotton, palm oil, and sugar prices increasing due to supply constraints globally. 

Exports of non-traditional goods rose by 2.4 percent to US$6,343.1 million, with the increase noticeable in gold, horticultural products, and oil seeds. 

The export of gold amounted to US$3,108.8 million, compared with US$2,872.6 million in the previous period, and accounted for 49 percent of non-traditional exports.

Exports of horticultural products edged up by 46.5 percent to USD 425.4 million, driven by an increase in exports of edible vegetables.

Service receipts surged to US$6,482.5 million in the year to February 2024 from US$5,094 million in the previous year, largely driven by travel (tourism) and transportation receipt.

The surge in travel receipts reflects the rebound of the tourism sector, as tourist arrivals rose by 21.4 percent to 1,881,823 from 1,550,333. 

In Zanzibar Exports of goods and services reached US$ 217.7 million in the year ending February 2024, up from US$198.0 million recorded in similar period in 2023  on account of an increase in exports of both goods (seaweeds, manufactured products, fish, and fish products) and services (tourism).

Earnings from services rose by 12.8 percent to US$145.9 million, following an increase in tourist arrivals. 

Cloves exports in value terms declined by 33.1 percent to USD 28.3 million due to the cyclical nature of the crop. 

On a month- to-month basis, exports of goods and services rose to US$20.2 million compared to US$2.7 million in February 2023, largely associated with an increase in manufactured goods.

The central bank monthly review also shows imports of goods and services fell to US$16,087.2 million, compared with USD 16,928.3 million a year earlier.

The decrease was driven by refined white petroleum products, fertilizers, and plastic items. 

Conversely, imports of machinery, industrial transport equipment and passenger motor cars increased. 

On a monthly basis, goods imports slightly rose to US$1,056.8 million in February 2024, compared with US$ 1,003.7 million recorded in similar month in 2023.

Services payments declined to US$2,280.6 million compared with US$2,561.8 million in the year to February 2023 on account of lower freight payments attributable to reduced import bills.

The primary income account recorded a deficit of US$1,551.7 million, higher than US$1,255.0 million recorded in February 2023, due to higher interest payments abroad. 

In Zanzibar, the imports of goods and services across all goods categories rose to US$ 613.3 million from US$568.3 million recorded in the year ending February 2023. 

Capital goods increased to US$71.6 million from US$44.0 million, largely associated with ongoing infrastructure projects while intermediate goods import rose by 1.7 percent to US$384.0 million, largely due to an increase in imports of ingredients for food and beverages, and motorcars for households. 

Consumer goods imports increased by 3.6 percent to US$ 57.9 million, mostly influenced by other consumer goods, in particular insecticides, textiles, paper, and paper products