Tanzania has demonstrated robust economic growth in the first and second quarters of this year, with a growth rate of 5.4 percent and 5.2 percent, respectively. According to the Monetary Policy Committee (MPC) Meeting Statement released by the Central Bank, this growth is expected to reach 5.3 percent by the end of the year.
The MPC convened its 228th Meeting on October 27, 2023, to evaluate the implementation of monetary policy and assess the recent economic performance and outlook.
The MPC highlighted that the adoption of a less accommodative monetary policy effectively maintained appropriate liquidity levels in the economy during August, September, and October 2023. This, combined with supportive fiscal and structural policies, has helped control inflationary pressures, promote economic activities, and preserve financial sector stability amid challenges in the global economic landscape. The policy stance has also alleviated foreign currency demand pressures.
The committee also evaluated the global economic environment for 2023 and observed that global growth remains lackluster despite surpassing projections in the first half of the year.
This subdued growth can be attributed to a tightening monetary policy cycle, geopolitical tensions, and high oil prices. While inflation has eased in many countries compared to 2022, it remains higher than target levels. To restore inflation to lower levels, central banks have maintained a tightening monetary policy.
The performance of government budgetary operations has been satisfactory, with revenue reaching 96.2 per cent during the first quarter of the 2023/24 fiscal year. In Zanzibar, the resource envelope exceeded the target by 1.7 per cent, and expenditure has continued to align with available resources, as stated in the MPC’s statement.