Maleiane separates public debt from increased cost of living in Mozambique – Notícias

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Maleiane separates public debt from increased cost of living in Mozambique – Notícias

2:51 CAT | 19 May 2016

Notícias / Minister of Economy and Finance

The plummeting metical exchange rate and soaring cost of living are not the result of state-guaranteed debts incurred by Ematum, Proindicus and MAM, according to Minister of Economy and Finance Adriano Maleiane.

Speaking at a hearing on the national debt organized by the parliamentary Planning and Budget and Defence and Public Order committees, Maleiane said that the guarantees in question do not have an impact on the state budget, and there was therefore no reason to talk about reallocation of the budget for their payment.

So far, according to the minister, the government has only issued guarantees, “which have not yet gone beyond that”, since the companies that contracted the debts have not yet exhausted all the possibilities they have to honour their commitments.

“Our problem is that we consume more than we produce. This is what is reflected in the level of inflation and the exchange rate,” Maleiane explained. “Unfortunately, there are operators who take advantage of the debate on these two guarantees to justify price hikes and the rising exchange rate, worsening the cost of living and [driving] pessimistic expectations about the future,” he added.

Source: Notícias