The Confederation of Business Associations (CTA) held this Wednesday, November 2, in Maputo, the 10th edition of the Economic Briefing, where it presented the 9th edition of the Business Strength Index, which increased one percentage point in the third quarter of this year.
Going from 28% to 29% compared to the second quarter, “the main drivers of this increase were: (i) the peak of the agricultural marketing season; (ii) the recovery of the transport sector following the tariff adjustments; (iii) and the continuous recovery of the tourism sector”, revealed the president of CTA, Agostinho Vuma.
The leader further explained that “this performance was not more pronounced because of the impacts of the high prices of fuels, the production below expectations in the fisheries sector (due to the low operationalization of the fleet in view of the high operating costs and the low catches), and also a certain retraction of demand due to the rising cost of living.
As for the employment rate, the president of CTA said that “was 116.7% in the quarter under review, showing a preference for hiring temporary or part-time labor, especially in the agriculture sector. He added: “the outlook is, until the end of the year, to continue the trend of increasing business performance. However, the increase in the cost of financing, the maintenance of inflationary pressures and the situation of instability in the province of Cabo Delgado may condition the desired dynamism in business activity.”
Monetary Policy Measures
The Central Bank’s monetary policy measures have not gone unnoticed before the eyes of the private sector, with the president of the CTA advocating a more reserved attitude from the Financial Regulator so as not to compromise the treasury of national companies.
“The current scenario, characterized by the tightening of financing conditions to cope with rising prices, imposes on us a reflection on the magnitude of tolerance for inflation, along with the creation of conditions to boost business performance,” explained Agostinho Vuma.
“We recognize the work that the monetary authority has done to ensure exchange rate stability, but we advocate that it should have a more reserved attitude in the adjustments it has made to the market’s key interest rates. For example, the prime rate, which in January was 18.6%, this month was set at 22.5%, that is, a four percentage point increase. Imagine the effort of micro, small and medium-sized companies to honor their commitments with banks”, warned the CTA leader.
