Credit concession in Mozambique contracts 2.0% in 2016

21 April 2017

The credit market in Mozambique contracted by 2.0% in 2016, after expanding at an annual average of 14.6% in the period between 2010 and 2015, financial rating agency Fitch Ratings said in a recent report.

The quarterly report analysing the credit market in emerging and border markets states that “credit growth has slowed sharply in many border markets, reflecting normalisation to more sustainable levels in some countries,” adding that in other countries “there are pockets of systematic (stress).”

Fitch Ratings does not include figures for Mozambique, but presents the country as one of the contributors to the general slowdown in the emerging and border credit markets analysed by the credit rating agency.

The report, entitled “Downturn in Borrowing in the Border Markets, shows pockets of tension,” reports that in 2016 “credit growth slowed in 20 of the 28 border countries that Fitch follows,” from growth of 9.1% in 2015 to 4.7%, less than half of the annual average between 2010 and 2015.

A border market is a developing country that is more developed than the least developed but too small to be considered an emerging market.

The phrase, which emerged in 1992 at the World Bank Group’s International Finance Corporation, describes countries that are small and less accessible but where there are still investment opportunities that are sought after by investors seeking high returns for their capital. (macauhub)

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