Mozambique: Government expects IMF program to start in June – Tonela

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Mozambique: Government expects IMF program to start in June – Tonela

2:37 CAT | 20 Apr 2022

In file CoM

The Minister of Economy and Finance of Mozambique, Max Tonela, said in Washington on Tuesday that he expects the country’s new financial program with the International Monetary Fund (IMF) to start in June.

“We hope that the agreement with the IMF will be approved by the [IMF] board of directors in May, and that the start of implementation of the program will take place in June,” Minister Tonela said on the sidelines of the IMF and World Bank spring meetings in Washington, US.

The expectation is in line with the schedule recommended by the IMF for the implementation of macroeconomic and structural reforms agreed with Maputo.

The IMF announced on March 28 that it had reached staff-level agreement with authorities in Mozambique to implement a three-year program supported by an arrangement under the Extended Credit Facility (ECF) in the amount of about US$470 million (€428 million) for 2022-2025, disbursing financial aid to Mozambique for the first time since the revelations of the ‘hidden debt’ scandal.

In addition to the IMF, Max Tonela yesterday also asked the World Bank for “greater support”, without specifying amounts, but alluding to the “magnitude” of the reforms that the country must undertake.

“We would like to have more support from the World Bank in mobilising resources,” Tonela said at a meeting with the institution’s vice president for Eastern and Southern Africa, Hafez Ghanem.

“We have faced several challenges, mainly resulting from shocks associated with climate change, Covid-19, terrorist actions in the north of the country [Cabo Delgado] and now the uncertainties generated by the conflict between Russia and Ukraine,” the minister noted.

Source: Lusa