Dar’s inflation to decline to 5pc by mid-2014: IMF

President Jakaya Kikwete in a group photo with leaders of opposition parties and senior officers of his government at the State House in Dar es Salaam a fortnight ago. The Head of State agreed with the leaders to incorporate their views on the new Constitution Review Bill to be drawn by the government soon. PHOTO I FILE 

By Alawi Masare ,The Citizen

In Summary

Tanzania recorded an overall inflation of 6.1 per cent in September while the current account deficit also declined though minimally during the past few months.

Dar es Salaam.The speed at which the general prices of goods and services increases – inflation rate -- in Tanzania will slowdown further next year, the International Monetary Fund (IMF) has said, sending rays of hope to consumers as the buying power of the shilling will be enhanced.

The IMF – in statement sent to the media after completion of the Fund’s mission to Tanzania – said yesterday that it was convinced with the pace of the country’s economic growth, noting that inflation should go down further to five per cent by mid 2014.

“The economy has continued to perform well, growing by 7 per cent in the first half of 2013. In light of broadly benign developments in domestic food prices and with a continued prudent monetary policy stance, inflation is projected to decline to the authorities’ medium term target of 5 percent by mid-2014,” it says.

Tanzania recorded an overall inflation of 6.1 per cent in September while the current account deficit also declined though minimally during the past few months.

With such a background, IMF sees Tanzania’s economic future as bright. “The economic outlook is promising, with growth projected to continue at a similar pace for the full year,” says the Fund.

It noted, however, that for the current financial year, tax revenues are likely to fall short of initial projections. The Fund adds that development is likely to require sizable adjustments to the budget in the upcoming mid-year review to align expenditure plans with the available resources.