Exchange Rates (August 12 1994)
US$1 = TShs 512 – 530
£ Sterling 1 = TShs 760 – 820
The unofficial ‘black’ market in currency, which came to an end last year with the introduction of Bureaux de Changes has reappeared with the dollar rate at TShs 600 – Express.
MINIMUM WAGES RISE.
The minimum wage in Zanzibar has been raised to TShs 6,000 per month – an increase of 2.5% but education, medical and water services are to remain free – Daily News. The minimum salary for civil servants on the mainland has been raised to TShs 10,000 ($20) from TShs 5,000 per month – Express
COFFEE PRICE RISE
The price of coffee in the World market has increased by 40% over the last six months to some $2.40 (TShs 1,200) per kilo as a result of frost in Brazil. As the increase in likely to be only temporary, Tanzania may not obtain substantial benefit as much of its coffee is sold on the futures market. Coffee production has been falling – from 65,000 tons in 1986/87 to 45,000 tons in 1990/91. Kagera is the main region with 38% of total output followed by Kilimanjaro (23%), Mbeya and Ruvuma 13% each – Business Times.
THIRD PRIVATE BANK.
The International Finance Corporation (part of the World Bank Group) has announced that it has approved an equity investment up to US$ 0.8 million and a loan of US$ 5.0 million to help finance the creation of a third private bank in Tanzania – Eurafrican Bank Ltd. The bank is being sponsored by Banque Belgolaise in Belgium – Express.
INCREASE IN INTEREST RATES.
The National Bank of Commerce (NBC) ‘in an apparent attempt to stay alive’ has suspended overdrafts and raised its interest rates on lending from 30% to 39%. Overdrafts are being suspended except for export production and crop financing. The Managing Director Donald Kamori said that the Bank’s liquidity was satisfactory and deposits had increased by 20% between June 1983 and June this year but that the Bank of Tanzania had been pursuing a very tight monetary policy. The NBC was also still the Bank of the non-performing parastatals – Business Times.
The other banks also increased their lending rates. Standard Chartered Bank stated that it had done business to the tune of TShs 30 million since opening in November last year – Business Times.
RELAXATION OF BORDER CONTROLS.
Following a meeting in April between the Governors of the East African Central Banks, the Bank of Tanzania has announced that, to facilitate border trade between Tanzania and contiguous countries, transactions can now be settled in either shillings or the currency of the neighbouring country and there is no longer any limit on the amount in Tanzania Shillings or the other currencies used in border trade. Exports and imports other than those in border areas continue to be governed by existing regulations – Daily News
ANOTHER NEW BANK.
The first private indigenous bank to be licensed in Tanzania – the First Adili bank – is to open shortly and will emphasise merchant and investment banking according to Chief Executive Godfrey Chamungwana. The National Provident Fund is investing TShs 300 million in the new bank.
Foreign aid donors are planning to join with the
Tanzanian Controller and Auditor General to conduct audits of donor funds rather than conduct separate audits. USAID has already signed an agreement on these lines and other donors are expected to follow – Business Times.
GRADE ONE COTTON PRICES 1994/95: TShs 125 at ginneries (compared with TShs 85 last year) and TShs 120 at marketing centres (TShs 80).
ZANZIBAR’S GROSS DOMESTIC PRODUCT grew at a rate of 3.3% last year compared with 3.04% in the previous year. The agricultural sector contributed between 42% and 46% of the GDP while construction, trade and hotels contributed 25-28% Population now totals 742,500, but is increasing. Trade between Zanzibar and the mainland has flopped. Exports to the mainland comprised only coconut oil, fruits and re-exported goods worth TShs 4,831.1 million last year – Daily News.
DODOMA. Individuals and institutions have invested about TShs 60 billion under the government’s plan to transfer the capital to Dodoma. The Minister of Works, Communications and Transport has said that the state would continue to improve the social infrastructure there to speed up the transfer. During this financial year emphasis would be put on roads in industrial areas and on sanitation. Some of the institutions with big investments in Dodoma were the National Provident Fund and the National Insurance Corporation.
ZANZIBAR POWER. The African Development Bank and the British Government have given TShs 2.4 billion to the Zanzibar government to finance rehabilitation of thermal power stations and the electricity distribution system in Zanzibar and Pemba.
SMALL BUSINESS. A small enterprise promotion programme named FAIDA (Finance and Advice in Development Assistance) has been inaugurated in Arusha. It aims at establishing a regional framework to support small enterprises and to contribute to methodologies and support mechanisms that are cost effective and can be applied elsewhere in Tanzania.