Steady growth in Mozambican economy, says PM
The Tax Authority (AT) on 23 October launched a campaign to audit companies to increase the payments of VAT. It says it is owed an unpaid MT 3.6 bn ($60 mn). The TA has also launched a major crackdown on sales of beer, wine and spirits without tax stamps. Meanwhile the Social Security Institute (INSS) says it is owed MT 1.2 bn ($20 mn) by employers. (AIM Pt 9, 20, 25 Oct; O Pais 24 Oct)
At a press conference 24 October, the Economic Associations Federation (CTA) objected to renewed pressure that companies should pay more taxes. Kekobad Patel said that “companies are making a monumental effort to simply not close because of the crisis.” CTA Executive Director Eduardo Sengo pointed out that the government was trying to get more money from companies when it owned them $400 mn in unpaid VAT rebates. “How can we pay 17% VAT when there is no money in the till?” (O Pais 25 Oct)
Sengo also alleged that government had debts to companies for goods and services dating back to 2014 of MT 29 bn ($477 mn). (MediaFax 25 Oct)
Also Read: State still owes private sector companies 29 billion meticais – CTA
Interest rates were cut by 0.5% (50 basis points) on 26 October by the Monetary Policy Committee. The new interest rate, introduced in April, the Interbank Money Market Rate (MIMO), falls from 21.5% to 21% per cent. The central bank’s interventions on the interbank money market to regulate liquidity are based on this rate. The Standing Lending Facility (FPC, the rate paid by commercial banks to the central bank for money borrowed on the Interbank Money Market) falls from 22.5% to 22%, and the Standing Deposit Facility (FPD, the rate paid by the central bank to the commercial banks on money they deposit with it) falls from 16% to 15.5%. In addition, the Compulsory Reserves Coefficient – the amount of money that the commercial banks must deposit with the Bank of Mozambique – was reduced from 15% to 14%.
Economy decelerating: Economic growth in the second quarter fell to an annual rate of 3%, compared to historic levels of 7%, and early indications are that economic growth declined further in the third quarter, the Monetary Policy Committee said.
China cancels interest but offers another debt, in a deal signed 26 October. China has cancelled $35 mn in interest payments and it has offered $15 in “financial support” (presumably a new loan) toward the $50 mn Xai-Xai airport announced by President Nyusi on 19 April. (O Pais 27 Oct)
Peasants must work harder and produce more food President Filipe Nyusi said at the opening of the agricultural campaign in Moamba. (O Pais 26 Oct)
Also Read: Nyusi launches 2017/2018 agricultural campaign – WATCH
Government bank guarantees for fuel importers have been ended, and fuel importers will have to take full financial responsibility. (Noticias, AIM Pt 28 Oct)
By Joseph Hanlon
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