By Business Insider Reporter
Zanzibar’s external sector continues to display impressive resilience, with the current account surplus climbing to US$596.2 million in the year ending May 2025 – up from US$423.9 million during the corresponding period in 2024.
The new date, published in the Bank of Tanzania’s (BoT) June Monthly Economic Review (MER), attributes the strong performance primarily to a sustained boom in the tourism industry.
The current account surplus means that Zanzibar is earning more from exports of goods and services than it is spending on imports. The current account also includes net income from abroad and transfers.
In economic terms, this surplus signals strong foreign exchange inflows, increased national savings, and a reduced need for external borrowing – all of which contribute to greater economic stability and policy flexibility.
Tourism, the cornerstone of Zanzibar’s service exports, was the star performer. The sector generated US$1,152.8 million in service receipts, marking a 23.1% year-on-year increase, driven by a surge in international tourist arrivals.
“The number of tourists increased to 782,668, from 659,480 recorded in the year ending May 2024. On a month-to-month basis, exports of goods and services increased to US$ 95.5 million in May 2025 from US$44.5 million in May 2024,” reads the June 2025 MER.
In total, exports of goods and services rose by 18.5%, reaching US$1,186.2 million, with the tourism sector contributing the lion’s share. However, the data also pointed to sectoral disparities.
Notably, clove exports – a historically important source of foreign exchange – fell sharply by 88.5% to US$3.3 million, reflecting the cyclical nature of the crop and underscoring the need for diversification within the export base.
The current account surplus also reflects a moderate increase in imports, which rose by 4.1% to US$615.7 million.
The growth was driven mainly by imports of consumer goods such as food and beverages, and capital goods like electrical machinery and transport equipment.
The improved surplus positions Zanzibar favorably for investment and development, as it strengthens the shilling, bolsters foreign reserves, and enhances the government’s ability to fund critical infrastructure without over-reliance on external debt.
As the archipelago continues to leverage its natural beauty and cultural heritage to attract tourists, the latest figures suggest that tourism is not just recovering – but driving a broader economic transformation for Zanzibar.
