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Mozambique’s Foreign Trade in Services Falls 58.8% to $277M in H1

Mozambique’s Foreign Trade in Services Falls 58.8% to $277M in H1

Foreign trade in services showed a negative balance of US$277 million in the first half of this year, compared to US$672.6 million in the same period of 2022, representing a 58.8% decrease in the deficit.

According to the data contained in the quarterly Balance of Payments (BoP) bulletin, released last Wednesday, 2 August, by the Bank of Mozambique (BoM), to which the ED had access, excluding transactions from Major Projects (GP), the services account recorded a surplus balance, having stood at US$7 million, which corresponds to an improvement of more than 100%.

“The improvement in the deficit of the services account is mainly justified by the positive evolution of transport services, which went from a deficit of USD 368.2 million in the first quarter of 2022 to a surplus of USD 48.6 million in the first quarter of 2023, which represents a growth of more than 100%, with emphasis on the gains obtained from the provision of maritime, road, pipelines and electricity transmission services,” justifies the BoM report.

The document also stresses that the travel item stands out for the increase in net revenues by more than 100%, which may be related to the entry of more tourists visiting Mozambique after the drop recorded in the covid-19 period. Furthermore, “the reduction in the deficits of insurance and pension services with 49.1%, financial services with 88% and other services with 52.5% also contributed to the slowdown in the deficit of the services account”.

Overall, the bulletin indicates that of the categories of services that recorded increases in net costs, the highlight goes to the hiring of technical assistance with 34%, which represents a weight of 75% of the total services account, followed by research and development and management and consultancy with 48.5%, which is partly associated with the non-realisation of ventures that require this type of services by GPs.

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