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IMF Managing Director Praises “Good Performance” of Mozambican Economy

IMF Managing Director Praises “Good Performance” of Mozambican Economy

The Managing Director of the International Monetary Fund (IMF), Kristalina Georgieva, has recognised that the Mozambican economy has performed “well” due to the building of strong institutions and the adoption of good practices in the political and social fields.

Speaking on Wednesday 17 April in Washington, United States of America (USA), after a meeting with the President of the Republic, Filipe Nyusi, she expressed her satisfaction with the level of economic growth that the country has recorded, pointing out that the national reserves are stronger.

“We have an active programme with Mozambique, and I’m pleased to see that the country’s fiscal situation is strengthening, growth is up, inflation is down and reserves are strong,” she said.

Filipe Nyusi is in Washington to take part in an international conference on the Miombo forest. The event is organised by the International Conservation Caucus Foundation (ICCF) and the Wildlife Conservation Society (WCS), in partnership with the Mozambican government.

In January, the IMF announced the third review of the financing programme for Mozambique, guaranteeing the “immediate disbursement” of 60.7 million dollars for budget support.

“The Executive Board has completed the third review of the implementation of the Extended Credit Facility (ECF) programme for Mozambique. With this new amount, total disbursements to the country rise to 273 million dollars,” the institution said in a statement.

At the time, the financial institution argued that the programme’s performance has been satisfactory: “five of the eight structural benchmarks were met at the end of December 2023, and three of the four quantitative performance criteria were met”.

“Economic recovery is accelerating, supported by liquefied natural gas (LNG) projects in a context of modest non-mining growth. At the same time, inflationary pressures have declined markedly. Although the outlook remains positive, significant risks remain, mainly due to adverse weather events and the fragile security situation,” warned the IMF’s deputy managing director, Bo Li, quoted in the same communiqué.

The source recalled that this technical assistance programme “aims to support Mozambique’s economic recovery and reduce public debt and financing vulnerabilities, while promoting higher and more inclusive growth through structural reforms”.

The deputy executive director also recognised that the Mozambican authorities “are taking steps to ensure fiscal discipline in the short and medium term, but that given the country’s high debt and tight financing conditions, continued fiscal consolidation efforts are needed”.

“On the revenue side, the broadening of the VAT base will help to mobilise revenue efficiently. On the expenditure side, continuing to reform the wage bill will help create fiscal space for high-priority spending, including social spending,” Bo Li pointed out.


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