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CTA to Strip Banks of Broker Licencing to End Conflict of Interest with Stock Exchange

CTA to Strip Banks of Broker Licencing to End Conflict of Interest with Stock Exchange

The Confederation of Business Associations (CTA) held on Thursday, 27 April, in the city of Chimoio, Manica province, its 11th edition of the Business Strength Index for the third quarter, where it showed that the indicator fell one percentage point to 28% from 29% in the fourth quarter, as a result of the impact of the tourism sector which recorded a drop in demand.

CTA’s periodic business climate survey points to fuel costs and rising interest rates as the main factors that have been affecting business performance.

In the survey report, CTA points out that the recent measure by the Bank of Mozambique to reduce the co-payment on fuel import bills from 100 percent to 60 percent and the already announced rise in the respective prices are putting pressure on business costs, also highlighting the most recent decision by the government to transform the Mozambique Stock Exchange into a public limited company.

“It is important that these reforms continue at the level of the capital market to allow its development,” said Vasco Manhiça, vice president of the Confederation. He continued: “the CTA has always defended these reforms and we add that the Mozambique Stock Exchange should oblige commercial banks that want to continue working in the capital markets to set up subsidiaries for that purpose.

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Still on the transformation of the BVM into an S.A., CTA advocates the withdrawal of the brokerage license from the banks to end conflicts of interest in intermediation for access to the Stock Exchange.

At the event to present the Business Robustness Index, as well as agri-business, a prominent activity in that region of the country and important for the entire Mozambican economy, money laundering was the subject of reflection, taking into account the actions underway to remove Mozambique from the Financial Action Group’s grey list.

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