Mozambique requests IMF and World Bank support to deal with fuel price rise

17 May 2006

Maputo, Mozambique, 17 May – Mozambique has requested support from the International Monetary Fund (IMF) and the World Bank to deal with fuel price increases in the country, which could affect the economic growth expected for this year, the Finance Minister said.

According to Manuel Chang, the IMF had already said its was available to “review some indicators, such as the amount of funding it grants to Mozambique, taking into account this situation of high prices.”

The government hopes that the two institutions will grant extra funding of around US$50 million to boost Mozambican currency reserves and ensure that the country’s capacity fro importing fuel is maintained.

At the end of last month, according to the latest bulletin from the Bank of Mozambique, the country’s net international reserves totaled US$1.2 billion, US$58 million more than at the end of the previous two weeks.

“There is no doubt that the situation of fuel prices affects the economy. Mozambique is not a country that influences the price of oil on the international market so we have to pay established prices,” Chang said, cited by daily newspaper, Notícias.

The government, Chang said, was currently making efforts to “monitor the impact of oil price hikes,” and only later would it decide on measures to be introduced to reduce the effects on the country’s economy.

The Mozambican economy grew by 7.5 percent last year and for this year official forecasts point to growth of 8 percent. (macauhub)