TANZANIA'S economy is gaining momentum, driven by a surge in export earnings from traditional commodities and a booming tourism sector.

The latest data from the Bank of Tanzania (BoT) reveals a significant 31.1 percent reduction in the current account deficit, marking a positive shift amid improving global and domestic economic conditions. 

With foreign exchange reserves climbing and exports outpacing imports, the country is poised for stronger financial stability in 2025.

Data show the current account deficit narrowed to $2,021.5 million from $2,935 million, supported by robust growth in export earnings amid modest increase in importation of goods and services.

Consistently, foreign exchange reserves rose to $5,323.6 million in January 2025, compared with $5,107.1 million in the same period of 2024, sufficient to cover 4.3 months of projected imports—exceeding the national benchmark of 4 months.

Data show earnings from travel and transportation amounted to $6.3 billion during the year ended in January this year, which is nearly doubled the amount earned from gold exports, from $3.4 billion recorded during the year ended January 2024.

Exports of goods and services grew by 16.6 percent to $16,313.1 million in the year ending January 2025, compared with $13,990.1 million in the same period in 2024.

During the month under review, exports of goods increased by 21.6 percent to $9,400.3 million compared to $7,730.4 million during the same period in 2024.

Major contributors were gold, cashewnuts, tobacco, horticulture products, cereals, and coffee.

Gold exports increased to $3,531.5 million from $3,075.9 million in 2024 due to favourable prices in the global market.

Traditional exports registered a strong growth of 58.4 percent to $1,567.6 million, much of it emanating from cashew nuts, tobacco, and coffee, owing to good prices in the world market. 

Conversely, the export of manufactured products amounted to $1,319 million, slightly lower than $1,398.8 million recorded in the same period in 2024. 

Service receipts for the year ending January 2025 increased by 10.4 percent to $6,912.8 million compared to $6,259.6 million in the same period in 2024. 

The increase was largely driven by travel receipts, which accounted for 56.8 percent of total service receipts and 24.1 percent of total goods and services exports. 

The growth in travel earnings was associated with a rise in international tourist arrivals, which increased to 2,157,419 from 1,841,750 during the same period in 2024, supported by enhanced marketing efforts by both the government and private sector.

Imports of goods and services grew moderately in the year ending January 2025, rising to $16,872.7 million from $16,036.9 million in the same period of 2024. 

This moderation was attributed to reduced imports of refined petroleum products, machinery, and wheat grain, which collectively accounted for 23.5 percent of total imports. 

However, a notable rise was registered in imports of industrial supplies, transport equipment, and associated accessories, reflecting increased activities in the manufacturing, construction, and transportation sectors. 

Services payments rose by 10.2 percent to $2,533.8 million in the year ending January 2025, compared to $2,299.3 million in the same period in January 2024. 

The rise was largely associated with higher freight payments, which contributed 50.7 percent of total service payments. 

During the period under review, the primary income account deficit was $1,816.2 million, higher than $1,603.3 million in 2024, explained by the increase in the payment of income on equity and higher interest payments abroad. 

The secondary income account recorded a surplus of $589.1 million in the year ending January 2025, down from $687.3 million in 2024, largely explained by personal transfers. 

However, on monthly, the surplus in the account increased to $66.7 million in January 2025 from $25.1 million in January 2024.