- The Bretton Woods institution forecast that Tanzania’s economy would grow by 5.5 percent in 2021 – up from its earlier estimate of 2.5 percent for last year.
Dar es Salaam. The World Bank has upgraded its assessment of prospects for Tanzania’s economic growth this year as the world starts to recover from the impact of the Covid-19 pandemic which was expected to send sub-Saharan Africa into recession in 2020.
The Bretton Woods institution forecast that Tanzania’s economy would grow by 5.5 percent in 2021 – up from its earlier estimate of 2.5 percent for last year.
Tanzania’s real GDP had been growing at an average of seven percent in the last decade. But the government lowered the projections for 2020 to 5.5 percent from the initial projection of 6.9 percent due to various factors, including Covid-19, heavy rains - which resulted in floods and destruction of transportation infrastructure - as well as delayed implementation of some projects.
Sectors like tourism were hard-hit by the pandemic as countries imposed travel restrictions to control spread of the pandemic.
However, mining was among the economic activities to watch due to the rising price of gold in the world market during the pandemic.
According to the World Bank forecast, Tanzania is among the fastest growing economies in sub-Saharan Africa - it being above the region’s average growth projected at 2.7 percent.
The regional growth dropped by 3.7 percent in 2020 as a result of the coronavirus pandemic and strict lockdowns enacted to stem its spread. The recession last year halted almost two decades of growth that averaged four percent per year.
“Expectations of a sluggish recovery in sub-Saharan Africa reflect persistent Covid-19 outbreaks in several economies that have inhibited the resumption of economic activity,” a World Bank statement said.
“The rebound is expected to be slightly stronger — although below historical averages — among agricultural commodity exporters.”
The bank named agricultural exporters such as Benin, Ivory Coast, Malawi and Uganda as countries whose economies contracted less sharply in 2020.
The World Bank downgraded its outlook for the global economy, and warned that the situation could deteriorate if Covid-19 infections accelerate, or the vaccine rollout is delayed.
The coronavirus pandemic also has worsened the risks surrounding the rising debt load in developing nations, and it will take a global effort to avoid a new crisis in those economies, the bank cautions.
After shrinking 4.3 percent in 2020, the world economy is projected to grow by 4.0 percent this year: two-tenths lower than previously forecast, as more than half of the countries were downgraded in the semi-annual Global Economic Prospects report.
China was a bright spot, with a surprisingly fast recovery in 2020. But, advanced countries which did better last year will fare worse in 2021, the World Bank says.