November 12, 2013 / 3:16 PM / in 4 years

Tanzania current account deficit widens 26.1 pct in year to September

DAR ES SALAAM, Nov 12 (Reuters) - Tanzania’s current account deficit widened 26.1 percent in the year to September following a decline in receipts of aid and loans, its central bank said on Tuesday.

The deficit narrowed to $4.676 billion in the 12 months to September from $3.707 billion during the same period last year.

“Official current transfers declined by 43.7 percent from the levels recorded in the year ending September 2012 resulting into widening of the current account deficit by 26.1 percent,” the Bank of Tanzania said in its latest monthly economic report.

The bank did not explain the sharp fall in official current transfers which are composed of aid and loans from external sources.

Tourism earnings outpaced gold exports as the country’s top foreign exchange earner due to higher visitor arrivals, fetching $1.818 billion from $1.61 billion a year ago, representing a 13 percent increase.

Gold exports declined to $1.747 billion in the year to September, from $2.151 billion a year ago, due to a decline in both export volumes and prices.

Tanzania, which has a population of around 45 million, is Africa’s fourth-largest gold producer after South Africa, Ghana and Mali.

The value of traditional exports declined 8 percent to $818.2 million in the year ending September 2013 from $889.4 million previously, due to a decline in both export volumes and prices of sisal, cashew nuts and cloves.

The country’s total bill for imports of goods and services rose 2.9 percent in the 12 months through September to $13.319 billion, while the value of its exports of goods and services fell 1.4 percent to $8.242 billion.

Gross official foreign exchange reserves held by the central bank rose to $4.59 billion in the year to September, or about 4.5 months of import cover, from $4.06 billion a year ago, the central bank said. (Reporting by Fumbuka Ng‘wanakilala; Writing by James Macharia; editing by Ron Askew)

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