Mozambique: Credit to the economy hit one-year-high in September
Mozambique: Public debt set to hit 102.5% of GDP this year – Fitch
5:15 CAT | 26 Nov 2018
In file CoM
Financial rating agency Fitch expects Mozambique’s public debt to reach 102.5% of GDP this year, whereas the economy should grow 3.5% this year and 3.7% in 2019.
“The government’s debt, including guarantees, will increase to 102.5% this year and its trajectory is highly sensitive to the volatility of exchange rates,” the Fitch analysts wrote.
In an analysis of the country’s economy, sent to investors, experts said that “the budget deficit will reach 5.7% of GDP, or 6.9% considering late payments, and then gradually increase to 7.3% in 2019 and 7.8% in 2020, reflecting the still low growth and pressures on expenditure due to the electoral cycle of this and next year and to decentralisation in 2020.”
Fitch’s projections showed that “public debt will increase, reaching a peak in 2022, when the ratio between debt and GDP is to reach 119% due to slower economic growth expectations and limited fiscal consolidation.”
Fitch concludes that the highest risks are “depreciation of the exchange rate faster than expected, higher deficits and delays in gas megaprojects.”
Source: Lusa
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