Tanzania expects GDP growth of 2.5 percent in 2020

Thursday, September 24, 2020

In the recently published 14th Tanzania Economic Update (TEU), the World Bank predicts a drastic slowdown in economic growth due to the Covid 19 pandemic. According to World Bank analysts, the growth rate of 6.9 percent reported by the government in 2019 will be reduced to 2.5 percent. The outbreak and spread of Covid-19 has affected the labor market, production capacities and productivity. The country’s economy is already feeling the effects and although the government is trying to improve the situation by strengthening the health care system and numerous support measures for local companies, GDP will still fall dramatically in 2020. For example, tourism has come to a standstill and exports of industrial and agricultural goods have collapsed.

A downturn in the economy of Tanzania’s main trading partners has reduced demand and prices for industrial and agricultural goods. Restrictions on international travel and fear of infection with the virus are preventing the recovery of the tourism industry, which was one of the fastest growing sectors of the Tanzanian economy. The effects are also being felt on the labour market, with consumption and spending by private individuals falling and local shops having to close. The confidence of domestic investors is weakened, investments are held back and the government was able to collect less taxes due to the crisis.

Nevertheless, the World Bank sees numerous advantages for Tanzania over other African countries. The country has financial leeway due to balanced national finances and low debt. The international currency reserves are relatively high and amount to 6 months of import coverage. In addition, as an oil importer and gold exporter, Tanzania benefits from fluctuations in commodity prices, which can mitigate the effects of the lack of trade. For many products in the field of radio and telecommunications, certification is required for most African countries. The most important and sought-after certification of this is the Radio Type Approval. Radio Type Approval is intended to ensure that all local regulations are met and that only products without safety hazards are introduced to the market. For Tanzania a so-called Pre-Export Verification of Conformity (PVoC) is also required and is issued by the Tanzania Bureau of Standards (TBS). The PVoC is a verification of the declaration of conformity that must be made prior to import. MPR International GmbH – Africa Certification offers you a complete package for certification, where you will be excellently supported. Contact us for a free and non-binding assessment of your certification process for Tanzania or another African country.

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