1 October 2018

Tanzania 'Shifting From Traditional Trade Partners'

Dar es Salaam — Tanzania has made a major shift in trading in the first nine months of this year, with decreasing trade values among its major traditional partners, while it witnessed the emerging of new trade partners.

In that regard, the share of Tanzania's exports to the European Union (EU), Japan, the Middle East & North Africa (MENA), India and China has continued to shrink.

On the other hand, Zambia, Kenya and Turkey are emerging as Tanzania's major export destinations.

Tanzania had for a long time depended on India, China, EU, Switzerland and South Africa as its main trade partners for both exports and imports.

Gold was the main commodity exported to these five destinations, accounting for more than a half of the value of the country's exports.

The October 2018 Consensus Forecast for sub-Saharan Africa published last week by FocusEconomics, the Barcelona-based research institution, shows that EU suffered a major shrink in its imports from Tanzania, dropping from the 16.7 per cent recorded in January to 9.3 per cent nine months later.

Also, Tanzania's share of exports to China went down from 8.1 per cent in January to 7.8 per cent nine months later - while exports to India fell from 21.7 per cent in January this year to 21.1 per cent nine months down the road.

Major Tanzanian exports include - but are not limited to - ores and minerals, manufactured products, foods, mineral fuels and commercial crops such as cashew nuts, coffee, tea, cotton and tobacco.

The minister for Trade, Industry and Investments, Mr Charles Mwijage, told The Citizen last week that the emergence of countries such as the United Arabs Emirates (UAE) has led to increased fuel prices - which has in turn pushed up the prices of fuel imports.

He said the shrink in global trade volumes last year also slowed down trade transactions between Tanzania and its trading partners.

According to the minister, Tanzania is nurturing relatively new trading partners such as Turkey, which is becoming recognised as a serious trading partner in both import and export trade.

Mr Mwijage also said that the emergence of Zambia, Kenya and South Africa - whose trade volumes with Tanzania increased significantly during the first three quarters of this year - has contributed to the growth overall of Tanzanian trade with the regional economic blocs of the 16-member Southern African Development Community (SADC) and the six-member East African Community (EAC).

"We have decided to source some of the products we were importing from outside Africa to within our (African) continent to boost intra-regional trade," he said, citing as an example Tanzania's decision to import sugar from Zambia, Malawi and Mozambique instead of Brazil.

This, the minister stressed, has contributed in no small measure to the growth of trade values with these neighbouring countries.

The general idea is to also shift dependence on certain trade partners, opting instead to trade with any and all counties where lucrative opportunities are available.

Regarding the country's major sources of imports, the major decrease was experienced by China whose share fell from 35.2 per cent in January this year to 17.9 per cent nine months later, followed by the MENA countries (the Middle East and North Africa), whose exports to Tanzania fell from 11.9 per cent last January to 7.5 per cent in the third quarter of the year.

Major Tanzanian imports include fossil fuels - which accounted for 39 per cent of all imports in January, but whose share of the country's imports trade fell to 18.2 per cent nine months later - and manufactured products, whose imports increased to 64.1 per cent, up from 51.3 per cent in January.

Food imports - which had accounted for 7.6 per cent of all imports by Tanzania in January this year - fell to 6.9 per cent nine months later, while 'other' imports increased ten times during the same period: from 1.9 per cent in January to 10.8 per cent nine months later.

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