IMF expresses faith in Mozambique’s economic policies

imfInternational Monetary Fund headquarter in the US. (Image source: IMF)The International Monetary Fund (IMF) has expressed faith in Mozambique's economic policy and said that the country’s economy is currently in a good shape

IMF representative, Victor Vledo, supported the economic policy the Maputo administration has been following and said such policies have helped the country become steady financially.

Vledo said this during a news conference in Maputo marking the end of a two-week visit to Mozambique by an IMF mission to review programs being carried out by the government of Armando Guebuza.

The mission was conducting the fifth review of the Mozambican economy under a three-year Policy Support Instrument (PSI) that was approved in June 2010.

According to Vledo, fiscal revenues were very important for the implementation of the government’s social and economic projects.

Vledo said, “The economy remains buoyant, despite a weak global economic environment.”

He said that the IMF believed Mozambique’s economic growth rate this year would reach 7.5 per cent, rising to 8.4 per cent in 2013.

In a five-year period, he expected growth rates to remain between seven and 8.5 per cent. Vledo also praised the government for keeping inflation under control.

Vledo said that inflation would gather pace in the last couple of months of 2012, but not exceed 2.5 per cent for the year as a whole. 

The IMF also welcomed the Mozambican government’s intention to maintain high public investment in the next few years to address the huge infrastructure gap, and its intention to facilitate credit expansion to the private sector and reduce the cost of doing business.

The IMF mission also encouraged the Mozambican government in its efforts to enhance agricultural production and productivity, foster broad based employment creation, and support human and social development.

Vledo added that the government had enough room to allocate a sum of between 0.4 and 0.8 per cent of GDP to social protection programmes.

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