Business
Tanzania expects to see a growth and a drop in inflation in 2012
(Reuters) – Tanzania expects its punishing year-on-year inflation rate to fall to single digits by June this year from 19.2 percent in November, the east African country’s president said on Wednesday.
Like its east African neighbours, Tanzania struggled in 2011 with rising inflation driven by higher food and fuel prices, a worsening current account deficit and a slide in its currency to record lows against the U.S. dollar.
“We are still hopeful that our economy will grow at around 7 percent and that inflation will be brought down to single digits by June, 2012,” President Jakaya Kikwete said in a statement.
Chronic power shortages compounded the country’s problems against a backdrop of sluggish global recovery and the euro debt crisis.
“Inflation rose from 5.6 percent in December 2010 to 19.2 percent in November 2011, we have daunting challenges to contend with this year,” he said.
“I am confident, however, that with the plans and programmes we intend to initiate and, if we get the support of partners and friends of Tanzania, we should be able to rise to the challenges and prevail.”
Kikwete said power supply had stabilized after a period of prolonged rolling blackouts, with the government now eyeing long-term solutions to energy shortages.
The International Monetary Fund (IMF) said in November Tanzania’s growth in 2011 may exceed the 6 percent forecast earlier due to the strong performance of its telecommunications, construction and financial services sectors.
