“Strong” public and private investments drive Mozambique’s economy

1 April 2010

Washington, United States, 1 April – The Mozambican economy continues to see “strong performance” which is expected to continue in the mid- and long term, with projects for infrastructures for transport and electricity,” the International Monetary Fund (IMF) said Wednesday.

At the end of a two-week mission to Mozambique, the IMF gave its support for the Mozambican government’s intentions of boosting investment in priority infrastructures for transport and electricity, in the medium and long term, “in an effort to further increase the potential for growth and exports,” of the country.

“However,” said the statement published by the IMF, it is necessary to “ensure that those investments have a high return and help to generate additional investments from the private sector,” and that the authorities are cautious in terms of debt to “preserve macroeconomic stability.”

The IMF mission headed by Johannes Mueller was in Mozambique from 15 to 31 March, to assess the Policy Support Instrument (PSI), which is coming to an end, and the Exogenous Shock Facility (ESF).

The Mozambican economy, the statement said, “continues to have string performance,” and it is expected that growth will be close to 8 percent in the medium term, thanks to greater investment, which has speeded up against the 6 percent posted last year.

Inflation is expected to be around 6 percent in the mid-term and this year is expected to be above this level, due to a rise in the price of fuel.

The programme that will succeed the current PSI will focus on reforms to approve tax administration and public finances, along with management of public debt, the IMF statement said. (macauhub)