World financial crisis already having negative effect on Mozambique

1 July 2009

Maputo, Mozambique, 1 July – The world financial crisis has arrived in Mozambique with the balance of payments posting a deficit between January and March of US$316.3 million, according to provisional figures published by the Bank of Mozambique, cited by Mozambican newspaper Notícias.

At a press conference, the chairman of the bank, Waldemar de Sousa noted the development of the average international prices of the main goods that have an impact on the Mozambican economy last May, noting that the price of natural gas saw a drop of 25 percent, gold saw its price fall by 3.5 percent, whilst rice saw a monthly fall of 7.7 percent.

In the same month, the price of aluminium rose 7 percent, sugar saw a price rise of 3.85 percent, the rise in the price of wheat was 1 percent, whilst the price of cotton rose 10 percent.

According to Sousa, total international reserves in Mozambique were US$1.539 billion at the end of March, which represented a loss of US$104.1 million in the first three months of 2009.

“Since last year we have been seeing greater pressure on international reserves because our exports are falling and also because foreign aid is more difficult to secure. Our international reserves are there exactly to face crisis moments,” Sousa said.

Sousa said that the Goevrnment, in partnership with teh World Bank wa seeking additional source sof funding that would have a positive effect on teh country’s international reserves.

“We are not happy when we see our international reserves falling back. This is a reflection of the current economic difficulties that the national and international economies are facing. The government has made a request to the International Monetary Fund (IMF) to have access to the Exogenous Shock Facility, for around US$170 million,” he said. (macauhub)