Mozambique: 2009 State Budget includes increase to boost agricultural production

25 July 2008

Maputo, Mozambique, 25 July – The Mozambican 2009 State Budget will include an increase of 5 percent compared to the US$3.8 billion budget for this year in order to develop agricultural production and infrastructures, Minister Aiuba Cuereneia said Thursday in Maputo.

The Mozambican minister for Planning and Rural Development told the Reuters news agency that the 5 percent rise was mainly as a result of fuel and food price rises.

The Mozambican agricultural sector is the third biggest consumer of resources in the State Budget, following education and health, but the rise in food prices has altered the government’s priorities.

Mozambique, which does not produce or refine oil, has a budget of US$3.8 billion this year, half of which is to be supplied by international donors in the form of donations or loans with advantageous conditions.

Each year the country spends some US$500 million on importing food products and US$350 million on oil products and expects its energy bill to rise this year to US$700 million.

“We are trying to put together internal funds to fund the budget. Internally we have to depend on taxes and externally we are trying to obtain donation from our partners,” said Cuereneia.

Mozambique, whose economy is one of the fastest-growing in Southern Africa in the last decade, is this year expected to see growth of 8 percent and keep inflation down to a single digit. (macauhub)