Mozambican government approves new measures to slow rise in cost of living

30 March 2011

Maputo, Mozambique, 30 March – The Mozambican has approved a package of measures to slow the rise in cost of living, whilst keeping some measures approved last September, the end of which was scheduled for this month, the minister for planning and development, Aiuba Cuereneia said Tuesday in Maputo.

According to the minister, who was speaking at the end of a council of Ministers meeting, the new measures included a gradual re-adjustment of fuel prices starting in April, maintaining a subsidy on transport and also real fuel prices for large consumers, or so-called mega projects and other large companies.

Cited by Daily newspaper, Notícias, the minister said that the government had also decided to introduce a passenger subsidy in the form of a pass for workers and students, as of August when the current transport subsidy is due to come to an end.

As of June, according to Cuereneia, a subsidy will be introduced on the basic basket of goods for those who earn 2,000 meticals or less (US$64.7), with subsidies on bakeries and third rate rice coming to an end.

The measures announced by the Government extend to the decision not to adjust salaries and other remunerations of higher state workers and members of governing bodies of state companies, majority state-owned companies and Public Funds and Institutes and other similar state institutions.

Cuereneia noted that to finance the measures the government would make use of savings made from cost containments that have been in place and from not releasing obligatory retained earnings from the goods and services budget category.

The minister noted that with these measures the Government expected to mitigate the effects of increased international fuel and food prices, whilst saying there was a need to see domestic products increase their supply of food and for the market to create more jobs, not only in urban areas, but also in rural ones. (macauhub)