Bloomberg News

Tanzanian Economy Slows in Second Quarter on Gold Mine Closing

October 03, 2012

Tanzanian economic growth slowed in the second quarter as AngloGold Ashanti Ltd. (ANG)’s Geita gold mine temporarily shut down, causing a drop in production of the country’s biggest export earner.

Growth dropped to 6.9 percent from 7.1 percent reported in the first quarter, the National Bureau of Statistics said today in Dar es Salaam, Tanzania’s commercial hub.

Growth in mining slowed to 1.2 percent and gold output dropped to 9,819 kilograms (295,433 ounces) from 10,405 kilograms, the bureau said. “The slow rate has been attributed to the temporary closure of Geita Gold Mine due to major maintenance of the plant,” it said.

Tanzania, whose gold shipments were $2.26 billion in the year through July, vies with Mali to be Africa’s third-biggest producer of the metal after South Africa and Ghana. East Africa’s biggest economy after Kenya has also discovered almost 30 trillion cubic feet of natural gas.

“We may see a further deceleration of economic growth in the third quarter because this is when the budget was tabled, and government expenditure was low,” Yonoh Mtengule, chief economist of National Bank of Commerce Ltd., Absa Group’s Tanzanian unit, said in a phone interview today from Dar es Salaam. Growth may accelerate in the fourth quarter, he said.

To contact the reporter on this story: David Malingha Doya in Dar es Salaam at dmalingha@bloomberg.net

To contact the editor responsible for this story: Antony Sguazzin at asguazzin@bloomberg.net


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