Current account deficit narrows by 16 per cent

 

By By Veneranda Sumila The Citizen Reporter

In Summary

However, according to BoT, capital and financial account balances deteriorated, leading to the worsening of the overall balance of payments to a deficit of $460.2 million compared with a surplus of $192.2 million recorded in the corresponding period in 2014.

Dar es Salaam. The current account balance narrowed by 15.8 per cent to a deficit of $4.295 billion in the year ending March 2015 compared with $5.102 billion recorded previously, the Bank of Tanzania (BoT) has reported.

It said in its economic review for April that the improvement was mainly on account of an increase in exports of goods and services coupled with a decrease in imports of both goods and services.

However, according to BoT, capital and financial account balances deteriorated, leading to the worsening of the overall balance of payments to a deficit of $460.2 million compared with a surplus of $192.2 million recorded in the corresponding period in 2014.

Gross official foreign reserves declined to $4.064 billion as at the end of March 2015 from $4.226 billion recorded at the end of the preceding month.

“The decline was on account of payment of government external obligations and selling of foreign exchange in the inter-bank foreign exchange market for liquidity management and smoothening out of short-term fluctuations in the exchange rate,” said BoT.

The country’s value of imports of goods and services amounted to $13.45 billion in the year ending March 2015 compared with $13.76 billion recorded in the corresponding period in 2014.

BoT said the decline in the value of imports was largely on account of a decrease in imports of intermediate goods which more than offset increases in capital and other consumer goods.

A significant decline, according to BoT was recorded in the value of oil and fertilisers.

The value of export of goods and services increased to $9.355 billion in the year ending March 2015 compared with $8.593 billion recorded in the corresponding period in 2014.

“The good performance in exports of manufactured goods, travel receipts and traditional exports accounted for the improvement.”