Mozambique needs immediate US$120 million to fund balance of payments

15 May 2009

Dakar, Senegal, 15 May – Mozambique needs an immediate US$120 million to finance its balance of payments, the country’s Minister for Development and Planning, Aiuba Cuereneia said.

“An initial assessment by the Government in the immediate needs for funding the balance of payments of Mozambique estimates that US$120 million is the amount needed to ensure the stability of macroeconomic indicators,” Cuereneia said at the general meeting of the African Development Bank in Dakar.

Around half of Mozambique’s state budget is funded by a group of 19 donor countries and institutions, but the impact of the financial crisis on the country has worsened its situation.

“IN our case, we had to lower projections for GDP growth, as a result of the direct impact of slowed demand for Mozambique’s main exports, specifically aluminium, cotton, cashews and sea products,” he said.

Between 2000 and 2007, the country posted average growth of over 8.5 percent falling to 6.2 percent in 2008, as a result of flooding and frequent power black outs.

For 2009 the BAfD expects growth of 4.0 percent and 5.2 percent next year.

On Wednesday the International Monetary Fund (IMF) also published its forecasts for Mozambique estimating economic growth of 4.3 percent this year, one of the best performances on the African continent, despite being a fall of 2.5 percentage points on growth for 2008. (macauhub)