Mozambique’s budget deficit expected to rise to 9.2 pct of GDP in 2014

9 October 2014

Mozambique’s budget deficit is this year expected to increase to 9.2 percent of GDP, reflecting increases in capital expenditure and wages of civil servants, the International Monetary Fund (IMF) said Wednesday in Washington.

The Fiscal Monitor, which expands on and complements the data presented in the World Economic Outlook, released Tuesday, showed that the budget deficit is expected to widen from 2.7 percent of GDP in 2013 to 9.2 percent this year, then improving to 7.4 percent in 2015 and 6.6 percent the following year, falling in the years thereafter to 5.1 percent by 2019.

The country’s economic growth, however, will not be affected by the increased deficit, and is expected to grow 8.3 percent this year and 8.2 percent in 2015.

The National Statistics Institute said Wednesday in Maputo that the rate of inflation in September in Mozambique was -0.17 percent, continuing a process of deflation for the fifth consecutive month.

From April, the month in which prices rose 0.12 percent, Mozambique’s economy entered a period of deflation of -0.38 percent in May, -0.52 percent in June, -0.04 percent in July, -0.55 percent in August and -0.17 percent in September. (macauhub/MZ)