Tanzania Holds Key Interest Rate Steady

THE Bank of Tanzania (BoT) maintained its key lending rate at 6 per cent for the quarter ending December citing easing inflationary pressures and a positive economic outlook.

The Central bank governor, Emmanuel Tutuba, said in a statement that improving domestic and global conditions supported the decision to hold the rate steady by the monetary policy committee which met on Wednesday.

In the two quarters to September, the central bank held the benchmark rate at 6 per cent from 5.5 per cent that was announced in January when the bank introduced the rate.

The central bank targets to maintain inflation below 5 per cent, but consumer inflation has stayed comfortably below that figure, despite growing pressure on the shilling.

Inflation increased to 3.1 per cent year-on-year in August from 3.0 per cent the previous month, data from the National Bureau of Statistics show.

An economist and investment banker, Dr Hildebrand Shayo said the rate was likely to be maintained given the continued improvement in the global economy with inflation rate declining.

However, Dr Shayo raised concerns about the significant disparity between the Bank of Tanzania’s (BOT) key lending rate and the double-digit lending rates offered by commercial banks to customers.

He questioned the reasons behind this mismatch, suggesting that risk premiums alone cannot account for the high borrowing costs faced by consumers and businesses.

“Who will explain this significant discrepancy between the central bank rate and the commercial banks’ lending rates, which remain in double digits? What can account for the reality of expensive loans, aside from risk premiums?” he inquired.

Bank lending rates in Tanzania decreased slightly to 12.78 per cent in July from 12.82 per cent in June. Despite this minor decline, the spread between the central bank’s rate and commercial bank rates remains substantial.

The Head of Research and Financial Analytics at Alpha Capital, Imani Muhingo, said maintenance of the CBR at 6 per cent was expected, especially as inflation is still at the bottom of the target range, while US’s rate cut and seasonal foreign inflows are expected to relieve foreign exchange pressures.

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Despite presumed liquidity pressure in the banking sector, cutting rates would be moving in too quick given the time lag of US’s policy, he said.

Financial analysts were divided on their prediction on the new central bank rate, with opinions varying on the whether to increase, maintain, or slightly decrease the key rate.

Some predicted the central bank would maintain the rate at 6.0 per cent for the third consecutive time, citing stable inflation and favourable macroeconomic conditions.

Others suggested there would be a modest reduction to stimulate investment and support private sector credit growth given the recent US Fed rate cut.

Meanwhile, Mr Tutuba told reporters that foreign currency availability improved from July to September 2024 alongside the tourism season and sales of agricultural products and exports, as well as rising gold prices in the global market.

He stated that as a result of this trend, the depreciation rate of the shilling decreased to 10.1 per cent for the year ending September 2024, down from 12.5 per cent for the year ending June 2024.

Tutuba mentioned that foreign reserves increased to 5,413.6 million US dollars by the end of September 2024, up from 5,345.5 million US dollars in June 2024, sufficient to cover over four months of imports, aligning with the country’s goals.

He projected that foreign currency availability is expected to continue improving, driven by rising gold prices in the global market, tourism activities and sales of natural products like cashews, tobacco, coffee and cotton, as well as exports of staple foods like maize and rice to neighboring countries.

This improvement will also be supported by a decrease in fertiliser imports and declining energy product prices, which are expected to reduce the demand for foreign currency and enforce legal requirements regarding quoting and making payments in Tanzanian shillings.

Source: allafrica.com

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Tanzania Confirms Outbreak of Marburg Virus Disease

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Tanzania Confirms Outbreak of Marburg Virus Disease

Dodoma — Tanzania today confirmed an outbreak of Marburg virus disease in the northwestern Kagera region after one case tested positive for the virus following investigations and laboratory analysis of suspected cases of the disease.

President of the Republic of Tanzania, Her Excellency Samia Suluhu Hassan, made the announcement during a press briefing alongside World Health Organization (WHO) Director-General, Dr Tedros Adhanom Ghebreyesus, in the country’s administrative capital Dodoma.

“Laboratory tests conducted in Kabaile Mobile Laboratory in Kagera and later confirmed in Dar es Salaam identified one patient as being infected with the Marburg virus. Fortunately, the remaining suspected patients tested negative,” the president said. “We have demonstrated in the past our ability to contain a similar outbreak and are determined to do the same this time around.”

A total of 25 suspected cases have been reported as of 20 January 2025, all of whom have tested negative and are currently under close follow-up, the president said. The cases have been reported in Biharamulo and Muleba districts in Kagera.

“We have resolved to reassure the general public in Tanzania and the international community as a whole of our collective determination to address the global health challenges, including the Marburg virus disease,” said H.E President Hassan.

WHO is supporting Tanzanian health authorities to enhance key outbreak control measures including disease surveillance, testing, treatment, infection prevention and control, case management, as well as increasing public awareness among communities to prevent further spread of the virus.

“WHO, working with its partners, is committed to supporting the government of Tanzania to bring the outbreak under control as soon as possible, and to build a healthier, safer, fairer future for all the people of Tanzania,” said Dr Tedros. “Now is a time for collaboration, and commitment, to protecting the health of all people in Tanzania, and the region, from the risks posed by this disease.”

Marburg virus disease is highly virulent and causes haemorrhagic fever. It belongs to the same family as the virus that causes Ebola virus disease. Illness caused by Marburg virus begins abruptly. Patients present with high fever, severe headache and severe malaise. They may develop severe haemorrhagic symptoms within seven days.

“The declaration by the president and the measures being taken by the government are crucial in addressing the threat of this disease at the local and national levels as well as preventing potential cross-border spread,” said Dr Matshidiso Moeti, WHO Regional Director for Africa. “Our priority is to support the government to rapidly scale up measures to effectively respond to this outbreak and safeguard the health of the population,”

Tanzania previously reported an outbreak of Marburg in March 2023 – the country’s first – in Kagera region, in which a total of nine cases (eight confirmed and one probable) and six deaths were reported, with a case fatality ratio of 67%.

In the African region, previous outbreaks and sporadic cases have been reported in Angola, the Democratic Republic of the Congo, Ghana, Kenya, Equatorial Guinea, Rwanda, South Africa and Uganda.

Marburg virus is transmitted to people from fruit bats and spreads among humans through direct contact with the bodily fluids of infected people, surfaces and materials. Although several promising candidate medical countermeasures are currently undergoing clinical trials, there is no licensed treatment or vaccine for effective management or prevention of Marburg virus disease. However, early access to treatment and supportive care – rehydration with oral or intravenous fluids – and treatment of specific symptoms, improve survival.

Source: allafrica.com

January 20, 2025