NEWS

Mozambican economy expected to post growth of 2.2% in 2019

Mozambique posted economic growth of 2.2% in 2019, which compares with an increase of 3.43% in 2018, said the country’s National Statistics Institute (INE).

The growth recorded in 2019 was the lowest in the last decade, according to INE, whilst also revealing a slowdown in growth.

Figures published in the Bulletin of National Accounts for the fourth quarter and full-year 2019 showed, for example, that in 2012 Mozambique’s economy grew at a rate of 7.3%, and since then and apart from 2014, with growth of 7.4%, slowed until it reached 2.2% in 2019.

Separating 2019 by quarters, Mozambique’s economy grew 2.5% in the first, 2.3% in the second, 2.01% in the third (which was incraesed by 0.02 percentage points) and finally, 2.03% in the fourth quarter.

Economic performance in the fourth quarter of 2019 was mainly driven by the tertiary sector which grew at 1.5%, with greater emphasis on the financial services industry with growth of around 5.6%, followed by Transport, Storage, Auxiliary Transport Activities, Information and Communications with growth of around 3.17%.

In second place was the primary sector with growth of 0.72%, with the segments of fishing with 4.1%, assisted by agriculture, livestock, hunting, forestry, logging and related activities with growth of 1.4%.

The secondary sector noted a decrease of 0.87%, driven by the manufacturing industry with a decrease of 2.6%. (macauhub)

Mozambican Commodity Exchange expects to trade 10,000 tonnes of products

The Mozambican Commodities Exchange (BMM) expects this year to trade 10,000 tonnes of various products, the BMM president told Mozambican daily newspaper Notícias.

Vitória Paulo said that the amount of trade expected this year is an increase of 14.9% compared to 8,700 tonnes traded in 2019, which missed the target of 9,600 tonnes.

The “ambitious” target set for this year is based on forecasts of a rise in production and increased interest in depositing the products in complexes managed by the Commodities Exchange.

“As individual producers became aware of the existence of facilities there was an increase in the use of the silos, and the same happened with some companies,” said the president of the Exchange, who acknowledged that this is still very far from the target of trading millions of tonnes of goods.

Paulo recalled the Exchange has received requests from foreign buyers wishing to buy for markets in the Middle East, 10,000 tonnes of sesame, 50,000 tonnes of soybeans and 200,000 tonnes of yellow corn.

“All these requests were not being met due to scarcity in the domestic market,” she said.

The president of the BMM also said that the advantages of selling through an exchange come from it being an organised market, where prices are transparent and fair, “in that the parties negotiate based on a reference price.” (macauhub)

IFAD supports agriculture and fisheries in Mozambique

The Bank of Mozambique and the International Fund for Agricultural Development (IFAD) signed two financing agreements totalling US$115.5 million for agriculture and fisheries in Rome, the Mozambican press reported.

The financial agreement for the development of Small-Scale Aquaculture (PRO-DAPE), with a value of US$43 million, aims to contribute to the improvement of living conditions, food security and resilience to climate change.

The Programme for Value Chain Development in the agriculture sector, worth US$72.5 million, is intended to contribute to the development of life and food security and in critical regions of the country.

Support for the new programme for food security and resilience to climate change will benefit at least 902,500 rural producers in Mozambique, one of the African countries affected by those changes.

In Mozambique, 70% of the population lives in rural areas and is highly vulnerable to climate change, and it is the third most-affected country in Africa, with approximately 58% of the population affected by these changes.

Mozambican daily newspaper Notícias, reported that the two agreements were signed by the deputy governor of the Bank of Mozambique, Victor Gomes, and by Donald Brown, the associate vice president of IFAD, a United Nations agency. (macauhub)

Natural gas exports will lead Mozambique’s to grow at higher rates, EIU says

The Mozambican economy is expected to grow at increasingly positive rates of between 4.2% in 2020 and 9.9% in 2024, the year in which the country may already be exporting liquefied natural gas (LNG), according to the latest report from the Economist Intelligence Unit (EIU) about the country.

In 2019 the economy grew at a rate of 1.9%, due to the combined effect of two cyclones that hit the country, named Idai and Kenneth, according to estimates from the EIU.

The years starting from now, according to the EIU, are expected to see more accelerated economic growth, driven by investments that oil groups will continue to make focused on the start of exploration of huge natural gas deposits in two blocks of the Rovuma basin, A1 and A4.

The document also noted that the current account deficit will increase this year and next, both as a result of increased imports following the cyclones and the increase of capital goods imports related to natural gas exploration, before decreasing in 2024 as gas exports begin.

The EIU recalled that Mozambique has been practically removed from capital markets following the disclosure of the country’s hidden debts, but added that the agreement reached between the government and the creditors of the issue of Eurobonds of Mozambican tuna company Ematum, will improve this relationship.

A relationship which, however, will not return to its previous situation while two outstanding State-backed loans taken on by two public companies and which were deemed illegal remain unpaid.

The Economist Intelligence Unit said Mozambique had been ranked in 120th place out of 167 countries in the Democracy Index, with 3.65 points out of a possible 10, having fallen four places in relation to 2018, when the country scored 3.85 points.

Mozambique is thus classified as a country with an authoritarian regime, as it was in 2018 but worse than in 2017, when the regime was classified as a hybrid, with 4.2 points.

The drop in the Democracy Index, according to the EIU, is due to widespread fraud and violence in the presidential, parliamentary and provincial elections held in October 2019 and a state of political conflict and simmering security issues, coupled with the country’s debt crisis. (macauhub)

Mozambique launches campaign to plant new cashew trees in Nampula province

Mozambique’s National Cashew Institute (Incaju) has launched a campaign for the distribution of more than 2 million seedlings in Nampula province, aiming to renew the country’s largest area of cashew trees in the country, said the Incaju provincial delegate.

Julius Langa said that the distribution of cashew seedlings began last December, with a focus in the districts with the highest production of cashew nuts in Nampula province, such as Mogovolas, Angoche and Moma, as well as Lalaua, Ribáuè and Malema, where this cash crop is less common.

The distribution of seedlings, focused on the smallholding sector and then the commercial sector, is based on the need to replace older trees. There are currently around 15 million trees, but only 3 million are being treated and produce cashews effectively and regularly.

The provincial delegate of Incaju also told the AIM news agency that growth of 6.0% is expected in the sale of cashews in the 2020/2021 campaign, “which means increasing from 76,000 to 78,000 tonnes.”

Langa added that the goal set for the 2019/2020 campaign of 73,000 tonnes was not met as sales totalled 66,000, “due to rains, theft and mishandling of the product after the harvest.” (macauhub)

Port of Maputo in Mozambique sets a new record for cargo processing in 2019

The cargo handled at the port of Maputo in 2019 reached 21 million tonnes, beating the record of 19.5 million tonnes registered in 2018, said the Maputo Port Development Company (MPDC).

The growth observed in 2019 was due, primarily, to the processing of larger quantities of chromium and substantial growth in the number of containers and the tonnage of magnetite.

The statement issued on Tuesday showed that chromium accounted for 30% of all cargo handled, with 6.4 million tonnes or 82% of the total cargo arriving at the port of the Mozambican capital by road.

“However, the joint effort undertaken by the Mozambican port and railway company (CFM), South African railway company TFR and the port of Maputo continue to produce positive results in obtaining a better balance between road and rail freight,” the statement said.

In 2020, following the completion of the project for the recovery of dock (the first phase will be delivered in May 2020 and the second stage in July 2020), additional growth and greater efficiency in cargo processing are expected.

The refurbishment will not only create a dock with a draft of up to -16 metres, but will also improve the occupancy rate by increasing the docking area.

The acquisition of new equipment for processing cargo, including two mobile cranes, shovels, loaders, tractors, diggers for unloading wagons, etc. also contributed to the results achieved in the processing of bulk cargo. (macauhub)

Mozambique is recovering well from the damage caused by cyclones in 2019

Mozambique is recovering well from the combined effect of cyclones Idai and Kenneth, which affected the country in 2019, said in Maputo, the deputy director-general of the International Monetary Fund (IMF), quoted by the Mozambican press.

Tao Zhang, who held a meeting with the Minister of Economy and Finance, Adriano Maleiane, and the governor of the Bank of Mozambique, Rogério Zandamela, as he left praised the macro-economic reforms underway in the country.

“I am particularly satisfied with the economic performance, which has been good, and beyond that, the country is recovering well from the devastating impact of tropical cyclones Idai and Kenneth, registered in the last year,” he said.

The visit of Tao Zhang to Mozambique comes at a time when the return to or no support for the State Budget is being analysed by cooperation partners, including the IMF and the World Bank.

Since 2016, when the hidden debt scandal came to light in Mozambique, the IMF and other cooperation partners suspended their support to the Mozambican state budget.

The case has seen some developments in the Mozambican justice system, which was one of the conditions put in place by the partners for the resumption of aid to the budget, but cooperation partners have yet to make their position clear.  (macauhub)

IMF analyses future relations with Mozambique in Maputo

A mission from the International Monetary Fund (IMF) headed by the deputy director-general Tao Zhang is in Maputo to analyse the current and future relationship with the government of Mozambique, reported the Mozambican press.

During their stay in Mozambique, the IMF delegation will hold talks with the Minister of Economy and Finance, Adriano Maleiane, the governor of the Bank of Mozambique, Rogério Zandamela, among other entities.

The meetings are expected to be used to discuss a potential return of the IMF to financing the Mozambican State Budget, frozen for about four years following the disclosure of the scandal of so-called hidden debts.

The previous visit of an IMF mission to Mozambique occurred in November 2019, and since thee, the head of that mission Ricardo Velloso had expressed openness to the resumption of financial programmes with the country.

The possibility of a return to financial assistance from the IMF could pave the way to other financings from external partners. Another factor that would suggest a possibility of those partners returning is that in October Mozambique reached an agreement with creditors for the second restructuring of Eurobonds of Mozambican tuna company Ematum. (macauhub)

NEWS

Mozambique posted economic growth of 2.2% in 2019, which compares with an increase of 3.43% in 2018, said the country’s National Statistics Institute (INE).

The growth recorded in 2019 was the lowest in the last decade, according to INE, whilst also revealing a slowdown in growth.

Figures published in the Bulletin of National Accounts for the fourth quarter and full-year 2019 showed, for example, that in 2012 Mozambique’s economy grew at a rate of 7.3%, and since then and apart from 2014, with growth of 7.4%, slowed until it reached 2.2% in 2019.

Separating 2019 by quarters, Mozambique’s economy grew 2.5% in the first, 2.3% in the second, 2.01% in the third (which was incraesed by 0.02 percentage points) and finally, 2.03% in the fourth quarter.

Economic performance in the fourth quarter of 2019 was mainly driven by the tertiary sector which grew at 1.5%, with greater emphasis on the financial services industry with growth of around 5.6%, followed by Transport, Storage, Auxiliary Transport Activities, Information and Communications with growth of around 3.17%.

In second place was the primary sector with growth of 0.72%, with the segments of fishing with 4.1%, assisted by agriculture, livestock, hunting, forestry, logging and related activities with growth of 1.4%.

The secondary sector noted a decrease of 0.87%, driven by the manufacturing industry with a decrease of 2.6%. (macauhub)

The Mozambican Commodities Exchange (BMM) expects this year to trade 10,000 tonnes of various products, the BMM president told Mozambican daily newspaper Notícias.

Vitória Paulo said that the amount of trade expected this year is an increase of 14.9% compared to 8,700 tonnes traded in 2019, which missed the target of 9,600 tonnes.

The “ambitious” target set for this year is based on forecasts of a rise in production and increased interest in depositing the products in complexes managed by the Commodities Exchange.

“As individual producers became aware of the existence of facilities there was an increase in the use of the silos, and the same happened with some companies,” said the president of the Exchange, who acknowledged that this is still very far from the target of trading millions of tonnes of goods.

Paulo recalled the Exchange has received requests from foreign buyers wishing to buy for markets in the Middle East, 10,000 tonnes of sesame, 50,000 tonnes of soybeans and 200,000 tonnes of yellow corn.

“All these requests were not being met due to scarcity in the domestic market,” she said.

The president of the BMM also said that the advantages of selling through an exchange come from it being an organised market, where prices are transparent and fair, “in that the parties negotiate based on a reference price.” (macauhub)

The Bank of Mozambique and the International Fund for Agricultural Development (IFAD) signed two financing agreements totalling US$115.5 million for agriculture and fisheries in Rome, the Mozambican press reported.

The financial agreement for the development of Small-Scale Aquaculture (PRO-DAPE), with a value of US$43 million, aims to contribute to the improvement of living conditions, food security and resilience to climate change.

The Programme for Value Chain Development in the agriculture sector, worth US$72.5 million, is intended to contribute to the development of life and food security and in critical regions of the country.

Support for the new programme for food security and resilience to climate change will benefit at least 902,500 rural producers in Mozambique, one of the African countries affected by those changes.

In Mozambique, 70% of the population lives in rural areas and is highly vulnerable to climate change, and it is the third most-affected country in Africa, with approximately 58% of the population affected by these changes.

Mozambican daily newspaper Notícias, reported that the two agreements were signed by the deputy governor of the Bank of Mozambique, Victor Gomes, and by Donald Brown, the associate vice president of IFAD, a United Nations agency. (macauhub)

The Mozambican economy is expected to grow at increasingly positive rates of between 4.2% in 2020 and 9.9% in 2024, the year in which the country may already be exporting liquefied natural gas (LNG), according to the latest report from the Economist Intelligence Unit (EIU) about the country.

In 2019 the economy grew at a rate of 1.9%, due to the combined effect of two cyclones that hit the country, named Idai and Kenneth, according to estimates from the EIU.

The years starting from now, according to the EIU, are expected to see more accelerated economic growth, driven by investments that oil groups will continue to make focused on the start of exploration of huge natural gas deposits in two blocks of the Rovuma basin, A1 and A4.

The document also noted that the current account deficit will increase this year and next, both as a result of increased imports following the cyclones and the increase of capital goods imports related to natural gas exploration, before decreasing in 2024 as gas exports begin.

The EIU recalled that Mozambique has been practically removed from capital markets following the disclosure of the country’s hidden debts, but added that the agreement reached between the government and the creditors of the issue of Eurobonds of Mozambican tuna company Ematum, will improve this relationship.

A relationship which, however, will not return to its previous situation while two outstanding State-backed loans taken on by two public companies and which were deemed illegal remain unpaid.

The Economist Intelligence Unit said Mozambique had been ranked in 120th place out of 167 countries in the Democracy Index, with 3.65 points out of a possible 10, having fallen four places in relation to 2018, when the country scored 3.85 points.

Mozambique is thus classified as a country with an authoritarian regime, as it was in 2018 but worse than in 2017, when the regime was classified as a hybrid, with 4.2 points.

The drop in the Democracy Index, according to the EIU, is due to widespread fraud and violence in the presidential, parliamentary and provincial elections held in October 2019 and a state of political conflict and simmering security issues, coupled with the country’s debt crisis. (macauhub)

Mozambique’s National Cashew Institute (Incaju) has launched a campaign for the distribution of more than 2 million seedlings in Nampula province, aiming to renew the country’s largest area of cashew trees in the country, said the Incaju provincial delegate.

Julius Langa said that the distribution of cashew seedlings began last December, with a focus in the districts with the highest production of cashew nuts in Nampula province, such as Mogovolas, Angoche and Moma, as well as Lalaua, Ribáuè and Malema, where this cash crop is less common.

The distribution of seedlings, focused on the smallholding sector and then the commercial sector, is based on the need to replace older trees. There are currently around 15 million trees, but only 3 million are being treated and produce cashews effectively and regularly.

The provincial delegate of Incaju also told the AIM news agency that growth of 6.0% is expected in the sale of cashews in the 2020/2021 campaign, “which means increasing from 76,000 to 78,000 tonnes.”

Langa added that the goal set for the 2019/2020 campaign of 73,000 tonnes was not met as sales totalled 66,000, “due to rains, theft and mishandling of the product after the harvest.” (macauhub)

The cargo handled at the port of Maputo in 2019 reached 21 million tonnes, beating the record of 19.5 million tonnes registered in 2018, said the Maputo Port Development Company (MPDC).

The growth observed in 2019 was due, primarily, to the processing of larger quantities of chromium and substantial growth in the number of containers and the tonnage of magnetite.

The statement issued on Tuesday showed that chromium accounted for 30% of all cargo handled, with 6.4 million tonnes or 82% of the total cargo arriving at the port of the Mozambican capital by road.

“However, the joint effort undertaken by the Mozambican port and railway company (CFM), South African railway company TFR and the port of Maputo continue to produce positive results in obtaining a better balance between road and rail freight,” the statement said.

In 2020, following the completion of the project for the recovery of dock (the first phase will be delivered in May 2020 and the second stage in July 2020), additional growth and greater efficiency in cargo processing are expected.

The refurbishment will not only create a dock with a draft of up to -16 metres, but will also improve the occupancy rate by increasing the docking area.

The acquisition of new equipment for processing cargo, including two mobile cranes, shovels, loaders, tractors, diggers for unloading wagons, etc. also contributed to the results achieved in the processing of bulk cargo. (macauhub)

Mozambique is recovering well from the combined effect of cyclones Idai and Kenneth, which affected the country in 2019, said in Maputo, the deputy director-general of the International Monetary Fund (IMF), quoted by the Mozambican press.

Tao Zhang, who held a meeting with the Minister of Economy and Finance, Adriano Maleiane, and the governor of the Bank of Mozambique, Rogério Zandamela, as he left praised the macro-economic reforms underway in the country.

“I am particularly satisfied with the economic performance, which has been good, and beyond that, the country is recovering well from the devastating impact of tropical cyclones Idai and Kenneth, registered in the last year,” he said.

The visit of Tao Zhang to Mozambique comes at a time when the return to or no support for the State Budget is being analysed by cooperation partners, including the IMF and the World Bank.

Since 2016, when the hidden debt scandal came to light in Mozambique, the IMF and other cooperation partners suspended their support to the Mozambican state budget.

The case has seen some developments in the Mozambican justice system, which was one of the conditions put in place by the partners for the resumption of aid to the budget, but cooperation partners have yet to make their position clear.  (macauhub)

A mission from the International Monetary Fund (IMF) headed by the deputy director-general Tao Zhang is in Maputo to analyse the current and future relationship with the government of Mozambique, reported the Mozambican press.

During their stay in Mozambique, the IMF delegation will hold talks with the Minister of Economy and Finance, Adriano Maleiane, the governor of the Bank of Mozambique, Rogério Zandamela, among other entities.

The meetings are expected to be used to discuss a potential return of the IMF to financing the Mozambican State Budget, frozen for about four years following the disclosure of the scandal of so-called hidden debts.

The previous visit of an IMF mission to Mozambique occurred in November 2019, and since thee, the head of that mission Ricardo Velloso had expressed openness to the resumption of financial programmes with the country.

The possibility of a return to financial assistance from the IMF could pave the way to other financings from external partners. Another factor that would suggest a possibility of those partners returning is that in October Mozambique reached an agreement with creditors for the second restructuring of Eurobonds of Mozambican tuna company Ematum. (macauhub)

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