The Mozambican economy will grow moderately in the next three years, reaching 4% in the medium term, sustained by the increase of production in the agriculture sector.
The scenario results from investments to be made in the provision of improved seeds and technical assistance to producers and actors in the agricultural sector, with emphasis on cereals, roots and tubers.
The projection is included in the medium-term fiscal scenario, approved a few days ago by the government, which expects the national economy to pick up as the country manages to mitigate Covid-19 and collect more revenues.
Speaking in Maputo, the spokesman for the Ministry for the Economy and Finance, Alfredo Mutombene, explained that the projections did not incorporate revenues from natural gas exploration projects.
He said that the document had been drawn up in an environment marked by a rise in uncertainty due to a combination of internal and external shocks, particularly the effects of Covid-19, restrictions on external funding, a drop in international commodity prices and depreciation of the exchange rate against the main currencies.
According to Alfredo Mutombene, combined monetary and fiscal policy measures are being implemented in order to ensure macroeconomic stability.
Policy options under the instrument will continue to be geared towards maintaining macroeconomic stability, continuing the fiscal consolidation process to ensure fiscal sustainability and diversified economic growth in the medium and long term.
According to the source, a recovery of the national economy is expected, with a return to activities after the relaxation of insulation measures, particularly the agriculture and electricity sectors, whose growth rates for 2021 are four and three percent, respectively.
The spokesman explained that the medium-term fiscal scenario 2022-2024 is based on two hypotheses: one that is based on the economy recovering by 2.1 percent, assuming effectiveness of the economic policy measures adopted and an increase in global demand for raw materials and domestic demand for services.
The other assumes a moderate recovery in economic activity, at a rate of 1.5% in 2021, influenced by the relaxation of social isolation measures with the beginning of the immunisation process against the Covid-19 pandemic, through vaccination.
The supply outlook indicates that agriculture will continue to have a large share in GDP, although the challenge remains to improve resilience to weather conditions. Sectors such as agriculture, electricity, gas and water, construction, manufacturing and extractive industry, among others, will contribute to the growth of the Gross Domestic Product (GDP) during the 2022-2024 triennium.
The Ministry of Economy and Finance considers that the agriculture sector proved resilient and was not directly affected by the pandemic, having presented a positive growth of 2.8% in 2020.
This growth was driven by the production of cereals such as maize, sorghum and rice, tubers (cassava and sweet potato) and the increased production of beans.
