BoT state of the economy report viewed favourably

The state of the economy presented by Central Bank Governor, Professor Benno Ndulu, in Dar es Salaam on Wednesday has met with positive reaction from the public with analysts projecting a bright future for the country.

“The economic indicators are true and there is a bright future of the country’s economy,” a senior lecturer from the University of Dar es Salaam, Professor Humphrey Moshi, said in the city yesterday.

He, however, touted more investment in agriculture due to its central role in the economy, particularly in realising the industrialisation drive and poverty reduction. “The economy is growing but not inclusive without steady agriculture sector, the biggest employer, source of raw materials for industries and food for the people,” Prof Moshi added.

Similarly, he said, the government should take early measures of bad weather this season that would affect food supply and inflation next year. On dry money in the circulation, the don said BoT should work on dollarisation of the economy and put more attention on bureaux de change, some of which are conduits for money flights.

He said all bureaux de change should be part of the banks for easy monitoring of their businesses as quotations on dollar impact on the value of the shilling, leading to inflation.

The Chairman of the CEO Roundtable, Mr Ali Mufuruki, gave a thumb up to Prof Ndulu, saying the governor’s explanation on the state of economy “very much met my expectations on the real situation on the ground.

’’ Mr Mufuruki argued that there was a notion among the people that basing on the slump in the individual’s economy; the country’s economy was also in trouble, which was not right.

“In fact, if there is too much circulation of money at individual level to the extent that you can’t establish its sources, this isn’t good sign for the country’s economy,” he observed. He stated that though Prof Ndulu gave an encouraging projection of economic growth to 7.2 per cent this year, there were things that the country needs to work on to achieve the target.

The prominent businessman mentioned increasing agricultural production and ensuring the market of the produce and increasing output of social-economic infrastructures such as electricity, among others.

An economic expert at the University of Dar es Salaam (UDSM), Dr Ellinami Minja, said: “Of course I believe what Governor Ndulu said since he based his presentation on the basis of data collected.” He noted that the new economic projection now proved that what many people had initially thought - that the Fifth Phase Government has negatively affected the economy - was wrong since “generally the economy is stable.’’

Prof Delphin Rwegasira of the Economics Department of the University of Dar es Salaam said he agrees with the BoT governor’s assertions that people used to get cheap money that was being dished out by corrupt officials.

“We now have a new government that is doing things differently because it is concentrating on development, sealing loopholes for tax evasion whereas money accrued from one side is taken to the other to boost development,” he noted.

Prof Haji Semboja also of the University of Dar es Salaam’s Economics Department observed that BoT was an arm of the central government that uses specific indicators to determine the country’s economic performance. Among them, he said, was the country’s GDP, government financing deficit and balance of economy.

“The policy of the government is to invest in the country’s development … therefore, at the macro level, the economy is stable although at the micro level, people feel that there is low circulation of money and that is why they say the situation is tight,’’ he explained.

The university don added that this was the transition period pegged on top priorities put in place by the government that in the long run will bring positive results even to the private sector.

“We are now going to an efficient economy differently from an economy that relied on cheap money obtained illegally,’’ insisted Prof Semboja.