Page 5 - Haradali Annual Report
P. 5

Chairman’s Statement. . .



   Economic Review and Outlook

   During 2018 Tanzania’s economic growth rate experienced a deceleration. The country’s Gross Domestic
   product (GDP) growth rate was an estimated 6.7% in 2018, down from 7.1% in 2017 and growth was
   projected to slow down further to 6.6% for the  years 2019 and 2020 according to World Bank reports.




   The growth registered was mainly supported by large infrastructure spending which unfortunately has little
   supply chain linkages and correlation with the domestic economy therefore the expected positive eects
   from the increased spending on infrastructure are not as prevalent as would have been expected or wished

   for.



   Due to the structural issues aecting the domestic economy, we predict that in 2019 major infrastructure
   projects will continue to drive GDP growth rates however the eects on domestic business activity will

   continue to be muted. However we expect that the Government will take measures to correct some of the

   un-intended consequences facing the domestic economy as a result of the structural friction in the
   Infrastructure Investment led growth including the general lack of liquidity in the domestic economy.



   Financial Markets

   Over the last year the nancial markets performance was generally unfavourable; the Dar es Salaam stock
   exchange took a downward trend which resulted in a value decline for most of domestic stocks. DSE’s total
   market capitalization fell by -15%.  The sectors that support Haradali investments such as the Banking,

   Finance and Investment (BFI) registered a drop in its index by -10.39% with most of the nancial institutions

   being aected by liquidity shortage due to a reduction in government expenditure and increase in
   non-performing loans.



   Haradali Capital’s investment portfolio has signicant weighting in the banking and insurance sectors as

   well as manufacturing as can  be attested.  These sectors have had mixed performance with some of
   investments particularly  in the Banking sectors in Kenya performing very well while our  banking and
   manufacturing assets in Tanzania save for TBL shares performed poorly losing ground due to the general

   economic malaise prevailing on the domestic front.



   However, the general consensus is that East Africa as a whole still presents one of the best regional growth
   prospects on the African Continent.



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