Tanzania's economy is expected to grow by about 5.5% in 2024, up from about 5% in 2023, but it faces risks from external geopolitical factors, its finance minister and central bank governor said in a letter to the International Monetary Fund.

In June, Finance Minister Mwigulu Nchemba said the East African nation's economy was forecast to grow 5.2% this year.

"Intensification of geopolitical conflicts, increased commodity price volatility, abrupt global slowdown or recession, and natural disasters related to climate change could weigh negatively on the near-term outlook of the Tanzanian economy," Nchemba and Central Bank Governor Emmanuel Tutuba said in the letter, made public late on Monday.

Nchemba and Tutuba said in the Nov. 27 letter that the central bank had sold $353.9 million on the foreign exchange market between July and October and had reduced the frequency and amounts of interventions.

"Going forward, forex interventions will be limited to addressing disorderly market conditions while the exchange rate will be allowed to be flexible to cushion the economy against external shocks," Nchemba and Tutuba said.

Tanzania's economy largely relies on tourism, mining, agriculture and manufacturing. (Reporting by George Obulutsa; Editing by Edmund Klamann and Gerry Doyle)