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Tanzania: Peg Growth of Economy on Tourism, World Bank Tells Tanzania

tanzania peg growth of economy on tourism world bank tells tanzania
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The World Bank projects that Tanzania’s recovery from the Covid-19 pandemic remains fragile and recommended revamping of the tourism sector to support growth in the second half of 2021.

It also estimates the GDP to grow by between 3.5 percent and 5.5 percent in 2021, below its long-run potential growth rate of about 6 percent.

Going into the second half of the year, income generated by export-oriented activities and rebounding employment is expected to bolster private consumption, which accounts for roughly two-thirds of the GDP. But the World Bank predicts that by the end of 2021, Tanzania is projected to be among the top ten growth performers in sub-Saharan Africa. This is the outlook of the 16th Tanzania Economic Update titled Transforming Tourism: Toward a Sustainable, Resilient, and Inclusive Sector.

“Tanzania’s economy is also expected to remain among the most stable in the region,” says the report,

The government consumption is expected to increase together with investment growth which will be driven by public investment in the flagship projects under the Five-Year Development Plan, including the standard gauge railway, the Nyerere Hydropower Project, and Air Tanzania Company Ltd.

In contrast to other East African states, Tanzania’s GDP is not expected to rebound in the first half of 2021 because the country did not previously impose such strict mobility restrictions.

“The global evolutions of the pandemic and domestic policies to manage the pandemic are the most important sources of risk to the economic outlook.

Restrictions on international travel and trade, stress in global financial markets, and elevated sovereign debt levels continue to adversely impact worldwide economic activity including foreign direct investment threatening the projected recovery,” says the report.