Mozambique’s economy “shows clear signs of recovery”

The Confederation of Economic Associations of Mozambique (CTA) says that the national economy recorded an increase in the business strength index in the last quarter of 2021, from 26% to 29%, with the employment trends index increasing by 106.5% to 125.9% – figures that, according to CTA, show the “recovery of the national economy.”

Speaking during the Economic Briefing held this Wednesday (February 23) in the city of Nampula, CTA president Agostinho Vuma stated: “This improvement essentially reflects the effect of the easing of restrictions in the context of preventing and combating Covid-19, and the boost in aggregate demand arising from the effect of the festive season.”

He was referring to figures in the economic robustness index, which rose by three percentage points in the fourth quarter of 2021.

Nonetheless. the labour scenario remains critical, he warned, and last year alone 11,000 jobs were lost, with Maputo and Inhambane worst hit. However, the trend towards economic recovery is also being reflected in the recovery of some previously lost jobs.

“As for the macroeconomic environment index, our assessment shows that this indicator rose from 46% to 50%, reflecting exchange rate stability, reduction of reference interest rates and recovery of economic activity,” Vuma concluded.

The numbers have an impact on the macro economy, because with companies back in operation, there are more exports, imports and therefore more possibility for the state to collect revenue. The year 2022 is expected to be still better, with the International Monetary Fund (IMF) forecasting economic growth of around 5.3%.

“Our balance of payments and our economy depend on the export of the main commodities such as coal, aluminium and gas and, internationally, the trend is for a price increase,” market analyst Farhana Razak said.

Participants in the Economic Briefing also suggested a similar scenario in the Nacala Special Economic Zone, which, despite the great optimism that characterised the first years of its creation seems to have relapsed somewhat, despite the infrastructure it enjoys, such as the Nacala deep water port, the railway line that makes up the Nacala Logistics Corridor (CLN), and Nacala International Airport.

Copyright © Club of Mozambique, 24 February 2022 à Maputo en Mozambique.

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