Majority of Mozambicans are unable to save

Login

Register

http://www.clubofmozambique.com/

Majority of Mozambicans are unable to save

6:29 CAT | 01 Nov 2017

File photo

Most Mozambicans do not have the capacity to cope with long-term shocks because they are unable to save money.

Economists warn that Mozambican consumer spending is accelerating faster than disposable income, which means that the country is not saving enough to compensate for the high levels of external debt.

A recent survey carried out by the Institute of Economic and Social Studies indicates that, in Mozambique, savings are still very limited and finance less than 10 percent of national investment.

Economist António Francisco, a researcher at that Institute, says that in the last decade, Mozambique has registered some savings growth, but doubts that this could lead to development.

“This growth is not a result of the population’s ability to save 20 or 30 percent to create human and physical capacity and expand their productive capacity,” says the economist.

subtitle – Social protection at risk

Figures from the Bank of Mozambique show that the share of the adult population with a bank account is around 36 percent, a low figure compared to the regional average.

The bulk of Mozambicans are unable to cope with long-term shocks, and Francisco warns that social protection is at risk.

“For social protection to be sustainable, there have to be savings. The state offers very limited social assistance, which does not cover more than 10 percent of the population.”

Economists point to the lack of financial resources as the main reason people do not have bank accounts.

Source: Voa Portugues