Oil & Gas

Tanzania’s import of goods and services recorded a modest 4.5 per cent increase to 17.42 billion US dollars for the year ending August, according to the latest Bank of Tanzania (BoT) monthly economic review. This growth was largely influenced by a decline in imports of refined white petroleum products, which fell by 11.4 per cent to 2.51 billion US dollars following a drop in global oil prices. The reduction in oil import costs is significant as it helps stabilise domestic fuel prices and reduce pressure on the trade balance.

Despite the overall decline in oil imports, the importation of industrial supplies, transportation equipment, spare parts, and accessories increased, supported by Tanzania’s ongoing industrialisation and infrastructure development projects. On a monthly basis, imports of goods amounted to 1.37 billion US dollars in August, compared to 1.46 billion US dollars in the same month last year, mainly due to lower oil import bills.

Meanwhile, service payments rose by 19 per cent to 3.02 billion US dollars, driven by higher freight charges linked to the overall import bill. However, on a monthly basis, service payments slightly decreased to 281.8 million US dollars from 284.7 million US dollars a year earlier. This indicates that while freight costs increased over the year, monthly fluctuations remained minor.

In contrast, Tanzania’s primary income account deficit widened to 1.99 billion US dollars from 1.70 billion US dollars last year due to increased payments on equity and interest abroad. The secondary income account surplus declined to 502.5 million US dollars, mainly due to a drop in personal transfers. These changes highlight a mixed performance in the country’s external sector, with gains from lower oil prices partly offset by rising external payments.