Thursday , July 16 2020

World Bank sees Tanzania growth rising to 5.6%


The World Bank sees Tanzania’s economic growth accelerating to 5.6% this year from an estimated 5.4% in 2018, driven by a recovery in exports and growing tourist arrivals.
The rate of expansion will also quicken to 5.8% in 2020 and 6.1% in the following year, it said in a report published on Tuesday.
“Tanzania was again one of the top growth performers in the region,” the lender said.
The World Bank warned the government against accumulating arrears and domestic debt.
“Fiscal management needs to be strengthened, especially given the intensification of spending pressures in advance of elections” in 2020, according to the report.
The government is unlikely to boost revenue to a target of 17.1% gross domestic product from 14%. It may also fail to achieve its fiscal deficit goal of 2.3% of GDP because of increasing spending pressures.
While Tanzania’s economic growth prospects remain positive, sustainability is a concern unless the private sector takes a larger role, the World Bank said.
The Washington-based lender expects the economy to expand by 6% annually over the medium-term, but says that depends on speedy reforms to improve fiscal management and the business environment for private investment and growth.
The World Bank urged Tanzania to allocate more resources to agriculture — which will continue to be a key driver of growth — than the current 2.5% of public spending.

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