Mozambique: €1.8 million a month timber smuggling in Cabo Delgado 'may be funding rebels'
In file CoM
Focus Economics consultancy said on Wednesday that the Mozambican economy had a weak start to the year, with shrinkage in the first quarter, following the lowest growth in the last 18 years in 2017.
“Available data point to a weak start of the economy this year, which follows the disappointing performance last year, when the economy grew at the lowest level in the last 18 years,” the consultancy writes with reference to seasonally adjusted negative growth of 0.7 percent disclosed by INE (National Statistics Institute).
“Year-on-year economic activity fell in the first quarter mainly due to a significant decline in activity in the retail and tourism industry,” Focus Economics analysts write in their monthly analysis of the African economy.
Mozambique avoids an official recession, defined as two consecutive quarters of negative growth, because in the last 3 months of last year, it registered growth of 1.8 percent while suffering a slight contraction of 0.1 percent, seasonally adjusted in the previous quarter.
“The current account deficit widened in the first quarter due to the trade deficit in the services sector, while external investment flows declined to less than half over the same period,” the analysts write.
According to the INE website, without adjusting for seasonality, the Mozambican economy grew by 3.2 percent in the first quarter. The website does not present the disaggregated data.
The Mozambican economy, analysts say, “will continue to be hampered by unsustainable levels of public debt,” growing by only 3.3 percent this year and next year. Inflation rose from 2.3 percent in April to 3.3 percent in May, and is likely to reach 4.8 percent by the end of the year and 6 percent in 2019.
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