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.
Key Highlights:
- 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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To contact the reporter on this story: Ken Karuri in Dar es Salaam at kkaruri@bloomberg.net
To contact the editors responsible for this story: David Malingha at dmalingha@bloomberg.net, Helen Nyambura
©2019 Bloomberg L.P.
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