tanzania prezi
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Tanzania: A tale of assisted reform
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Agenda
Brief economic history
Real sector
Prices
Fiscal Sector
External sector
Monetary Sector
Summary and the way forward
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Background and Brief economichistory
Low lows and high highs
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Snapshot of Tanzania
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Contrary to popular belief
Kilimanjaro is predominately found in Tanzania.
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8185 Declines
in foreign aidNyerere Resigns
8691 Partialliberization andinitial round ofreforms
91 SecondPoorest Country inthe world
9195 Stallingeconomicreforms
96presentDeeper reformsand efforts
65 Arushadeclarationadopted
Impasse with IMF
Large inflows offoreign aid
Independence, up untilthe Arusha declaration
59 Tanganyikaindependene
63 Zanzibarindependence
64 Tanzania
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Real Sector
High highs following major reform
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On the rise
-5%
-4%
-3%
-2%
-1%
0%
1%
2%
3%
4%
5%
6%
Percentage(%)
Tanzania real GDP per capita growth
Economicrecoveryprogramme
PrivatizationAgenda;fiscal andfinancialsector reforms
Miningactadopted
Fall inforeignassistance
IMF
/WBERP
Debt relief
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Not too shabby across the board
-6%
-4%
-2%
0%
2%
4%
6%
8%
10%
Percentage(%)
GDP growth
Tanzania Sub-Saharan Africa Emerging and developing countries Advanced economies World
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Fairly stable
0%
1%
2%
3%
4%
5%
6%
0
50
100
150
200
250
300
350
400
450
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
Percentage(%)
US$
Real GDP per capita and growth
Real GDP per capita (LHS) Real GDP per capita growth (RHS)
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Contraction of 1, Expansion of 2
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
ProportionofrealGDP
(%)
GDP by sector
Primary Sector Secondary sector Tertiary sector
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0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
ProportionofrealGDP(%)
GDP by economic activity
Agriculture, hunting, and forestry Mining and quarrying Manufacturing
Construction Trade and repairs Transport
Real estate and business services Public administration Other
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Driven by consumption?
0
2
4
6
8
10
12
14
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
GDP(US$)
Billions
GDP by expenditure
Household consumption Government consumption Investment
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Consumption declines steadily, asinvestment rises
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
ProportionofrealGDP(%)
Consumption/GDP and Investment/GDP
Household consumption Government consumption Investment
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Where is this investment from?
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
Proportion(%)
Public and private sector investment distribution
Private sector
Public sector (central government,
parastatals, and institutions)
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Fiscal sector
How much is too much?
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More taxes.
0
0.5
1
1.5
2
2.5
3
3.5
4
4.5
5
82%
84%
86%
88%
90%
92%
94%
96%
98%
100%
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
US$
Billions
Percentage(%)
Domestic revenue
Tax Revenue Non-tax Revenue Domestic Revenue
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Is there a development agenda?
0
1
2
3
4
5
6
7
8
9
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
US$
Billions
Percentage(%)
Total expenditure
Recurrent expenditure Development expenditure Total expenditure
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-40%
-20%
0%
20%
40%
60%
80%
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
Percentage(%)
Fiscal balance, shares of GDP
Domestic Revenue Total expenditure Overall deficit
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Continued reliance on the outside
0%
5%
10%
15%
20%
25%
0
0.2
0.4
0.6
0.8
1
1.2
1.4
1.6
1.8
2
1965
1966
1967
1968
1969
1970
1971
1972
1973
1974
1975
1976
1977
1978
1979
1980
1981
1982
1983
1984
1985
1986
1987
1988
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
Percentage(%)
US$
Billions
Official donor assitance and ODA/GDP
Offical donor assistance,ODA (LHS) ODA/GDP (RHS)
Liquidity
management
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A legacy of debt
0%
20%
40%
60%
80%
100%
120%
140%
160%
0
1
2
3
4
5
6
7
8
9
10
2002 2003 2004 2005 2006 2007 2008 2009 2010
Percentage(%)
US$
Billions
Public debt measures
National debt External debt National Debt/GDP External Debt/GDP Total Public debt/GDP
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What a relief
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Prices - Inside and Outside
Prices
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0%
5%
10%
15%
20%
25%
30%
35%
40%
0
500
1000
1500
2000
2500
1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
Percentage(%
)
T.Sh/US$
Nominal and real exchange rate, and CPI inflation
Nominal exchange rate (LHS) Real exchange rate (LHS) CPI Inflation (RHS)
Trade andexchange ratereforms
Bank of TanzaniaAct amendment
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Up, up, and away?
0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
Percentage(%
yoy,bas
e=2005)
CPI Inflation
Tanzania Advanced Economies Emerging and Developing Countries Sub-Saharan Africa World
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Nipped in the bud
0%
5%
10%
15%
20%
25%
Percentage(%,yoy)
CPI inflation
CPI Inflation
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0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
Percentage
(%,yoy)
CPI Inflation breakdown
Food Inflation Rate Energy Inflation Rate Core Inflation CPI Inflation Average CPI
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External sector
Steady, steady, import
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Ever-more reliance on importedgoods
-8
-6
-4
-2
0
2
4
6
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
US$
Billions
Trade balance
Imports of services
Imports of goods fob
Exports of services
Exports of goods fob
Net Exports
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Breakdown of imports and exports
0%10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Proportions of goods imports
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Proportions of service exports
Other
Computer, communications
and other services
Insurance and financial
services
Travel services
Transport services 0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Proportions of service imports
0%10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Goods exports
Other
Ores and metals
Manufactured
Fuel
Food
Agricultural raw materials
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Deterioration of the current account
-35%
-30%
-25%
-20%
-15%
-10%
-5%
0%
5%
10%
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
Percentage(%)
Current account balance items (% of GDP)
Balance on income
Balance on Services
Balance on Goods
Current Acccount Balance
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Steady balance
-6
-4
-2
0
2
4
6
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
US$
Billions
Balance of Payments
Financial Account
Capital Account
Current Account
Overall balance
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Foreign reserves rising
0
1
2
3
4
5
6
7
8
9
0
0.5
1
1.5
2
2.5
3
3.5
4
4.5
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
Months
US$
Billions
Reserves, and reserves in months of imports
Total Reserves (LHS) Total reserves in months of imports (RHS)
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FDI on the rise
0%
2%
4%
6%
8%
10%
12%
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
Percentage(%)
Foreign direct investment (% of GDP)
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Monetary sector and Prices
Money, money, everywhere
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Up, up, and away?
0%
5%
10%
15%
20%
25%
2008
Jan
2008
Mar
2008
May
2008
Jul
2008
Sep
2008
Nov
2009
Jan
2009
Feb
2009
Apr
2009
Jun
2009
Aug
2009
Oct
2009
Dec
2010
Feb
2010
Apr
2010
Jun
2010
Aug
2010
Oct
2010
Dec
2011
Feb
2011
Apr
2011
Jun
2011
Aug
2011
Oct
2011
Dec
2012
Feb
2012
Apr
2012
Jun
0
200
400
600
800
1000
1200
1400
1600
1800
T.Sh/US$
CPI inflation, nominal interest, and exchange rates
Nominal exchange rate CPI Inflation Nominal interest rate
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Is inflation driven by Money growth?
0.00%
2.00%
4.00%
6.00%
8.00%
10.00%
12.00%
14.00%
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
Percentage(%)
Broad Money growth and inflation
M3 growth (LHS) CPI Inflation (RHS)
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Money on the rise
0
2000
4000
6000
8000
10000
12000
14000
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
T.Shillings
Billions
Money Supply
M3
M2
M1
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Government claims rising, whileforeign assets, net, declining
-800%
-600%
-400%
-200%
0%
200%
400%
600%
800%
1000%
1200%
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
50%
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
Central bank assets and liabilities
NFA growth (LHS) M3 growth (RHS) NCG growth (RHS)
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Are there real returns?
-15%
-10%
-5%
0%
5%
10%
15%
20%
25%
Percentage(%)
CPI inflation, real, and nominal interest rates
CPI Inflation Real interest rate Nominal interest rate
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Summary: Lots of potential
Confidence, post-reformation
High GDP per capita, and it appears to be growingpersistently
Deterioration of the trade balance, yet some stability inthe current account
Legacy of debt
Inflation curtailed, and holding steady
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The way forward
Sustain momentum, in the midst of global economicslowdown
Public finances should be balanced with increasedpublic investment
Real transformation, through poverty reduction strategies
Continued private sector development
Long term viewfocus on reducing reliance on foreignassistance.
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There is hope.
Though, is it sustainable?
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