Bank of Mozambique Covid-19 mitigation measures will cost 40 billion meticais – A Verdade

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Bank of Mozambique Covid-19 mitigation measures will cost 40 billion meticais – A Verdade

3:37 CAT | 17 Apr 2020

Photo: A Verdade

The Minister of Economy and Finance has told the Assembly of the Republic that one of the first measures adopted by the Bank of Mozambique to mitigate the impact of Covid-19 on the Mozambican economy – relaxing monetary policy – will cost 40 billion meticais.

During the presentation of the proposals for the Economic and Social Plan and the State Budget, which do not include any specific measures to combat Covid-19 or mitigate its impact on the economy, Adriano Maleiane told the plenary of the Assembly of the Republic that the government had already been implementing several measures, citing the fiscal package approved this week by the Council of Ministers, which is budgeted at 40 billion meticais [around US$595 million at current exchange rates].

The head of Economy and Finance said that the monetary package introduced by the Bank of Mozambique in mid-March will cost another 40 billion meticais.

Regarding the monetary package, Minister Maleiane explained to @Verdade that “quantifying what the central bank is announcing, just the fact that it has reduced mandatory reserves (on deposits of commercial bank customers in national and foreign currency) by 150 basis points to 11,5% and 34.5 % respectively) leaves a margin for commercial banks to not deposit 7 billion (meticais). Plus the US$500 million credit line (about 33.5 billion meticais) makes 40 billion [around US$595 million at current exchange rates].”

By Adérito Caldeira

Source: A Verdade