Mozambique: FDI down 66.8% to US$460.1 million in Q1

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Mozambique: FDI down 66.8% to US$460.1 million in Q1

3:43 CAT | 04 Aug 2023

File photo: Lusa

In the first quarter of 2023, Mozambique recorded a 66.8% reduction in the flow of foreign direct investment (FDI) when compared to the same period in 2022, to a total of US$460.1 million.

According to data contained in the quarterly Balance of Payments bulletin released this Wednesday (02-08) by the Bank of Mozambique, the fall was caused by a reduction of investment in the extractive industries, mainly by Large Projects and companies from the traditional economy, by 67.8% and 54.3% respectively.

In terms of sectoral distribution, the central bank’s report indicates that, in the first three months of 2023, the extractive industry maintained its position as the largest recipient of investment flows, with a total of US$421.2 million, which corresponds to 91.6% of total FDI.
Of this, US$298.3 million was allocated to gas exploitation operations (equivalent to 70.8%) and the remainder was distributed among coal exploration, heavy sands and others.

Disaggregating FDI by instruments, “‘Other Capital’ remained, in the period under review, as the main form of FDI, as in previous periods”, the bulletin records. Thus, FDI carried out in the form of Other Capital stood at US$433.5 million, representing 94.2% of total investment.

“FDI carried out in the form of Other Capital decreased by 66.8%, determined by the slowdown in the mobilisation of resources (supplies and commercial credits) by GPs, compared to an increase of 2.7% by other sectors of the economy,” the document details.

South Africa was Mozambique’s main FDI partner, with a weight of 39.1%, followed by Mauritius, the Netherlands and the United Arab Emirates, with 34.3%, 17.2% and 8.9% of total net FDI in the country, respectively.

Source: Diário Económico