Favorable way forward for Tanzania’s economy

According to the Central Bank reports, the economy in Tanzania grew 6.7% on average in the first three quarters of 2018. There was a healthy private sector credit growth in the fourth quarter which points to resilient economic dynamics.

The construction sector accounted for highest growth in Q1-Q3, supported by buoyant public infrastructure spending. A surge in capital good purchases powered by the government’s infrastructure push boosted imports. Politically, parliament granted the government extensive powers over political parties in late January, a move which could undermine investor confidence.

Strong public investment spending, solid credit growth and more favorable weather conditions should underpin growth this year. Higher infrastructure expenditure, however, could inflate fiscal and current account deficits, while weakening investor sentiment clouds the outlook. Experts panelists expect GDP to expand 6.3% in 2019, which is unchanged from last month, and 6.4% in 2020.

The trade and investment programs include trade capacity building, enhancement in the private sector, better market access and opportunities, trade facilitation, food security programs, and export promotion support for African products.Tanzania is one of Africa’s fastest growing economies and its sustainable economic growth, and improved effective democratic governance will advance Tanzania’s transformation toward middle income status by 2025.