Mozambique: Government to take part in capital call of African Development Bank

21 May 2009

Maputo, Mozambique, 21 May – Mozambique plans to hand over US$50 million to the African Development Bank (ADB) over the next eight years in order to comply with a recent decision about the need to increase the bank’s capital, said Mozambique’s Minister for Planning and Development.

Cited by newspaper Notícias, Minister Aiuba Cuereneia said that incraeseing the bank’s capital would give the ADB capacity to provide non-concession loans (with up to 25% debt pardon) that the country had benefitted from for several years.

The ADB, which held a general meeting in Dakar on 14 and 15 May, decided to increase its capital by 6 percent, which at 31 December 2008 was calculated at 21.8 billion account units, or the equivalent of US$32.7 billion.

Speaking only moments after inaugurating a micro-finance bank in the town of Manhiça, Cuereneia said that during the ADB meeting the impact of the international financial crisis on African economies had been widely discussed, and a recommendation was given to governments to supervise the most sensitive areas, with particular focus on internal revenues.

In Mozambique’s case, available information shows that the country needs at least US$160 million in order to balance the balance of payments, fundamentally affected by a fall in the price of the country’s main export products, and the ADB is, according to Cuereneia, available to provide advice, funds and search for other sources of funding.(macauhub)