Trade Performance Review 2005: Tanzania

Year of publication: 
2005
Author(s): 
Josephat Kweka
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Despite the impressive macroeconomic performance of the Tanzania economy over the last decade (1995-2005), the trade (especially the export) response has been rather dismal. As shown in Table 1, whereas imports have increased tremendously (about 18 percent) between 1999 to 2003, export growth has decline by an average of -0.6% per annum respectively, implying deficit in trade balance. In the context of this study, trade performance between Tanzania and the SADC bloc show an encouraging trend for Tanzanian exports essentially reflecting the benefit of increased regional integration initiatives (Kweka and Mboya, 2004). Regional integration initiatives have included the progressive abolishment of some cross border non-tariff barriers and impact of SA's accession to SADC.

The growth in exports to SADC can also be attributed in part to the windfall gains from Tanzania's increase in cereal exports to the region because of the drought that hit the neighbouring countries of Malawi, Zambia and the DRC. Exports to SADC countries increased almost four-fold between 2000 and 2003, resulting in an average growth rate of over 45% over the five years under review, compared to imports that increased by 6% on average. However, it is important to note that the export base remains quite low in value compared to imports.

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