Mozambique may not need support for State Budget by 2023

27 August 2009

Maputo, Mozambique, 27 Aug – The head of the British Department for International Development (DFID) Mozambique, Keith Mackiggan, believes that Mozambique may no longer need budget support by 2023, if it maintains its current economic performance.

Quoted in Tuesday’s edition of independent daily “O País,” Mackiggan said that this was the conclusion of a group of DFID economists who had based their analysis upon historical data and on the assumption that Mozambique would maintain its current economic growth rate (7 percent per year), its domestic revenue as well the level of public expenditure.

To do this, the Mozambican government is working on a new strategy which should be finished next year, based on increasing tax collection and the diversification of domestic public expenditure.

According to Manuel Chang, Mozambique’s Finance Minister, the government is working to achieve a budget deficit which would allow the State to use its savings from previous years to fund future initiatives, something which is not happening now.

Over the next five years, the UK will disburse £250 million to Mozambique’s State Budget and for the country’s development projects.

However, Mackiggan warned that this sum could increase or decrease according to the performance of the Mozambican government, particularly with regard to the fight against corruption, the reduction of poverty levels and the implementation of decentralization programmes.

For 2009, the UK has granted £71million to Mozambique, of which £44million is for direct budget support. (macauhub)