The Planning and Budget Committee of the Assembly of the Republic is holding today, Tuesday, March 21, in Maputo, a public hearing on the proposed law that creates the Sovereign Wealth Fund in Mozambique.
Organized by the Assembly of the Republic (AR), in partnership with the Institute for Multiparty Democracy (IMD), the event also aims to reflect on the challenges, risks and economic prospects raised by the proposed law and will be attended by members of the Assembly of the Republic, members of the Provincial Assemblies, representatives of political parties, the Government and civil society organizations.
Broadly speaking, the Bank of Mozambique proposes that a Sovereign Wealth Fund be created with two objectives: to guarantee savings, with the central argument of meeting the needs of future generations, and to ensure fiscal stabilization to insulate the State Budget from exogenous shocks.
The final draft establishes that the Government’s revenues from oil and gas will be divided between the Sovereign Wealth Fund and the Country Budget. In the initial 15 years, the revenues will be distributed at a rate of 40% to the Fund and 60% to the Budget, then shifting to 50% for each of the parties.
The bill also provides for the Fund to begin operating already with the revenues from the Coral Sul platform.