Mozambique’s state budget: Govt to cut non-essential services, freeze hirings – Video

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Mozambique’s state budget: Govt to cut non-essential services, freeze hirings – Video

8:56 CAT | 09 May 2016

TVM / Adriano Maleiane, minister of Economy and Finance

The Minister of Economy and Finance has admitted that if the suspension of state budget support lasts any length of time, the government will be forced to cut non-essential services – services other than health and education.

Adriano Maleiane announced the immediate suspension of new hirings in the state sector and says that the sale of company assets to honour debt commitments is a possibility.

Following the International Monetary Fund and the World Bank lead, last week it was the turn of G14 aid partners to announce the suspension of general state budget funding to the tune of US$467 million.

Maleiane says that donor confidence was deeply shaken by the Ematum, Proindicus and MAM (Mozambique Asset Management) debts, and if lack of sustainability at the three companies made them unable to honour their debts, he would step in to sell their assets.

Meanwhile, the government would strengthen its grip on public spending, with only health and education escaping planned austerity measures.

Maleiane also announced that the IMF technical assistance mission which had previously cancelled its visit to the country was now in Mozambique evaluating economic and monetary policy.