The Bank of Mozambique sees consumer price inflation accelerating by the end of this year due to the consequences of the post-election tension in the country, according to its latest forecast, to which Lusa had access on Monday.
The Economic Situation and Inflation Outlook (CEPI) report indicates that inflation in Mozambique “remained stable in October” despite a slight month-on-month increase in prices of 2.68%, but that “the short-term outlook points to an acceleration in annual inflation in the fourth quarter of 2024.
“This forecast stems essentially from the restrictions on the supply of goods and services resulting from the post-election tension,” reads the report.
It adds that the November survey of economic agents “points to stability in annual inflation” at around 3.14% in December, equivalent to 19 basis points “below the expectations published in the previous survey.”
The governor of the central bank, Rogério Zandamela, said one month ago that the post-election unrest in the country should not in itself alter growth forecasts – with the government projecting 5.5% for this year – which already incorporated this possibility, as long as the instability “dissipates” in the “short term.” This has, however, not happened so far, with a series of strikes and demonstrations, including the closure of the country’s most important border crossing.
“For the time being, on the basis of what we know today, of how these risks are occurring and are materialising at the moment… on the understanding that this process, these risks, will dissipate in the short term, is that the outlook for our economy is positive,” the governor said at the time. “Today, for the time being. On the understanding that it will dissipate in a reasonable, short period of time.
“That’s the message, because [the post-election risks] were already built into our vision, into our outlook,” Zandamela added. “Today they’re just being realised. They’re not something new [that means] we have to adjust our forecasts.”
The announcement by Mozambique’s National Electoral Commission (CNE) on 24 October of the results of the 9 October elections, in which it awarded victory to Daniel Chapo, the candidate backed by the governing Frelimo party, which has been in power since 1975, in the election for president, with 70.67% of the votes, triggered popular protests. These were called by rival candidate Venâncio Mondlane, who placed second in the CNE count; he has promised to announce a new wave of protests on Monday.
The previous ones, between 27 and 29 November, led to a fresh paralysis of the city of Maputo, with barricades of demonstrators all over the capital, preventing traffic.
According to the CNE, Mondlane came second with 20.32%, but he has not recognised those results, which have yet to be validated and proclaimed by the Constitutional Council.
But according to the governor, “our projections have already incorporated these risks, these uncertainties.”
The wave of protest has been taking place in Mozambique since 21 October, with economic activities severely restricted, as post-election protests spread as far as the country’s main border crossing with South Africa, Ressano Garcia.
Lusa
