DAR ES SALAAM, Nov 8 (Reuters) - Tanzania’s current account deficit widened 20 percent in the year to August due to a sharp rise in the imports of oil and machinery for gas and oil exploration activities, its central bank said on Thursday.
Tanzania is fast becoming a regional energy hub following recent major discoveries of natural gas in its offshore.
The deficit in east Africa’s second-biggest economy widened to $3.596 billion from $3.006 billion in the year ago period.
Oil imports surged 30 percent to $3.457 billion due to a rise in domestic demand for thermal power generation.
“There was also a substantial increase in imports of machinery, which is associated with an increase in gas and oil exploration activities,” said the Bank of Tanzania in its latest monthly economic review report.
Imports of machinery rose 27.2 percent to $1.91 billion, said the central bank.
The country’s total imports bill rose by 18.2 percent to $12.781 billion, while exports increased by 15.2 percent to $8.281 billion from a year ago.
The central bank said the value of gold exports, the country’s top foreign exchange earner, rose 16.5 percent in the year to August largely due to an increase in gold prices at the world market and higher export volumes, fetching $2.27 billion.
Tanzania, with a population of around 43 million, is Africa’s fourth-largest gold producer after South Africa, Ghana and Mali. Gold accounted for 53.6 percent of the country’s total non-traditional exports.
The price of gold on the world market went up by 17.2 percent to $1,662.3 per troy ounce in the year to August, while the export volume of the precious metal increased to 40.2 tonnes from 37.9 tonnes previously.
Tourism earnings increased to $1.5 billion from $1.328 billion a year ago, on higher tourist arrivals.
Gross official foreign exchange reserves held by the central bank rose to $3.858 billion in the year to August, or about 4.1 months of import cover, from $3.725 billion a year ago.
For more details, go to here%202012.pdf (Reporting by Fumbuka Ng'wanakila; Editing by George Obulutsa, Ron Askew)