Mozambique is expected to see a gradual recovery of its Gross Domestic Product (GDP) this year with the recovery of private consumption and increased production.
The information was advanced during a webinar on the macroeconomic environment and opportunities in times of crisis.
The session promoted by Millennium bim counted with the participation of Moisés Jorge, executive director, and João Milheiro, corporate director, and was presented by Oldemiro Belchior, chief economist and director of investment banking in this financial institution.
The crisis resulting from the Covid-19 pandemic has generated an unprecedented economic shock and is associated with high levels of uncertainty. The coordinated implementation of monetary, fiscal and regulatory policy measures was crucial in supporting the economy and mitigating the impacts on economic agents.
A gradual recovery of the national GDP is forecast for 2021 and 2022 (1.2% and 3.8% respectively), in line with global economic forecasts, driven by the recovery of agricultural and industrial production in a context of improving external demand.
The appreciation of export commodity prices (especially mineral coal and aluminum), the widespread deployment of vaccines to curb the increase of new cases of Covid-19, increased consumption and private investment are key factors for the revival of economic activity in the short term.
Offshore natural gas production is planned to begin in 2022, through the floating platform in Area 4, South Coral, assuming that security is restored in the regions most affected by insurgent group attacks.
However, there are still some risk factors that may affect the economic recovery, including the reduction of foreign direct investment and capital inflow, aggravating external pressures, the loss of value of the national currency affecting the increase in the general price level (inflation), influencing the conservative stance of monetary policy of the Central Bank.
It was also mentioned that Mozambique has an extensive potential for renewable energy.
The potential for new renewables has only recently begun to be exploited on a large scale. The capacity of grid-connected renewables, today only 41 MW solar, will increase in ten years to 306 MW of both solar and wind power.
The population growth expected in the coming years and investments in the Liquified Natural Gas (LNG) sector will raise energy consumption needs for domestic, industrial and commercial use. Currently the rate of electrification connected to the network (on grid) is 38%, and there are about 20 million Mozambicans without access to electricity.
Hence the importance of betting on the renewable energy sector given the potential for growth, innovation, diversification of energy matrix and value generation for the national economy.
At the end of the session, the aggregate analysis of the banking sector was presented, with reference to 2020, highlighting the balance sheet indicators, income statement, solidity and credit quality of the largest banks in the Mozambican market.
