Mozambique: Defence, security spending to increase by 42% in 2024 to €971M
Maputo. [File photo: Macauhub]
The Barcelona-based FocusEconomics consultancy has lowered its forecast for Mozambique’s growth to 0.4% this year, but expects the economy to accelerate to 4.4% by 2020, 0.2 percentage points more than its previous forecast.
“The economy is expected to gain traction next year, following the recovery from the damage caused by tropical cyclones, and with the start of construction of investments related to the natural gas sector,” reads itsDecember analysis of African economies.
In the report, sent to clients and to which Lusa has had access, the Barcelona-based consultancy however warns that both “the high political tensions resulting from the elections and the growing current account deficit pose risks to the forecasts”, which nonetheless point to an acceleration of economic growth to 4.7% by 2021.
The consultancy expects inflation to rise to 4.8% in 2020 and to 5.4% in 2021 as the effect of recent cyclones works through into agricultural production, pushing up prices.
This month’s FocusEconomics newsletter also highlights the payment of US$ 726.5 million (about € 656 million) to sovereign debt creditors, emphasising that the deal “is positive for investor confidence and foreign aid”.
The Mozambique government informed the holders of sovereign debt on 30 October that it had “all the necessary conditions and authorizations” to move forward and resume repayments, making that same day a payment of around US$40 million (€36 million).
The document sent to investors also announces “the satisfaction of the settlement conditions and confirms that the settlement date will take place on October 30, 2019, in accordance with the terms of the Consent Solicitation Memorandum”.
The ‘hidden debts’ case relates to the guarantees given by the former Mozambican executive during past president Armando Guebuza’s two terms in office, guaranteeing loans of around US$2.2 billion (€2 billion) granted to public companies Ematum, MAM and Proindicus.
Mozambican justice and US justice are investigating the case to determine whether or not part of this money was used to pay bribes to Mozambican and foreign citizens.
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