6 °c
London
Monday, April 12, 2021
No Result
View All Result
FurtherAsia FurtherArabia FurtherBrazil FurtherRussia
FurtherAfrica
  • Countries
    • Angola
    • Botswana
    • Cape Verde
    • DRC
    • Eswatini
    • Ethiopia
    • Kenya
    • Malawi
    • Mauritius
    • Mozambique
    • Namibia
    • Nigeria
    • Rwanda
    • South Africa
    • Tanzania
    • Uganda
    • Zambia
    • Zimbabwe
  • OpenTalk
  • Understanding
  • Videos
  • Weekend
  • About
FurtherAfrica
  • Countries
    • Angola
    • Botswana
    • Cape Verde
    • DRC
    • Eswatini
    • Ethiopia
    • Kenya
    • Malawi
    • Mauritius
    • Mozambique
    • Namibia
    • Nigeria
    • Rwanda
    • South Africa
    • Tanzania
    • Uganda
    • Zambia
    • Zimbabwe
  • OpenTalk
  • Understanding
  • Videos
  • Weekend
  • About
No Result
View All Result
FurtherAfrica
No Result
View All Result
Home Africa

Mozambican high exchange rate caused by speculation, says minister

FurtherAfrica by FurtherAfrica
September 13, 2016
in Africa, Banking, Currency, Economy, FDI, Finance, Mozambique, Trade
Reading Time: 2 mins read
0
Mozambique’s economy grows 5.3 pct in 1st quarter of 2016
Share via QRWhatsappShare on FacebookShare on TwitterLinkedInPinteresteMail

The current exchange rate of the Mozambican currency, the metical, against the US dollar and other foreign currencies is the result of “large scale speculation”, according to the Minister of Economy and Finance, Adriano Maleiane.

Interviewed by the independent television station STV, Maleiane said that “according to parity purchasing power, and bearing in mind inflation in the neighbouring countries, particularly South Africa, and the general level of prices in Mozambique, a dollar should cost 55 or 56 meticais”.

But the current exchange rate, as quoted by the country’s largest commercial bank, the Millennium-BIM, is 75.1 meticais to the dollar.

The difference between 55 and 75 meticais, Maleiane said “is pure speculation. People are charging whatever rate they like in the perspective of making gains”.

Mozambique's Economy and Finance Minister Adriano Maleiane
Mozambique’s Economy and Finance Minister Adriano Maleiane

He added that the government has been forced to dip into the country’s international reserves to acquire essential goods such as fuel and medicines, and to cover the deficit of 500 million dollars, which would normally be covered by the country’s international partners.

The International Monetary Fund (IMF), the World Bank and all the donors who support the state budget have suspended all financial aid because of the undisclosed government guaranteed loans inherited from the previous government, headed by President Armando Guebuza. These undisclosed loans amount to over a billion US dollars.

Maleane believed that the best way to overcome the deficit is to increase exports “but this doesn’t happen from one day to the next”. Currently the country’s exports amount to around three billion dollars a year – which is less than half of the import bill of seven billion dollars a year.

Complicating matters were the attacks on the main roads in the centre of the country by gunmen of the Renamo rebels. “With attacks, it’s not possible to make things work normally”, said Maleiane. “And if I can’t export or sell goods, why should I produce them?”

These difficulties had forced the government to reduce its forecast for this year’s growth rate from seven per cent to 4.5 per cent.

“And the consequence of this is inflation, because we are not producing at the level we should”, said Maleiane. “Or if we do produce, the goods cannot move. For instance, to send a truck from Maputo to the north, the insurance costs nowadays are very expensive. This is reflected in the final price, and so we have high prices”.

The most important step that could be taken would be to end Renamo attacks at once. “I can guarantee that, on the day we stop these attacks, and people move around normally, prices will fall”, declared the Minister.

Source: AllAfrica

Related

Tags: Adriano Maleianecurrency devaluationcurrency exchangeforexIMFInternational Monetary FundmeticalMillenniumBIMMinister of Economy and FinanceMozambiqueparity purchasing powerspeculationWorld Bankモザンビーク莫桑比克
ScanSendShare320Tweet200Share56Pin72Send
Previous Post

Mozambique wants to make better use of silo system to improve national food reserves

Next Post

Swedish Green power for Mozambique telco

FurtherAfrica

FurtherAfrica

Founded in 2015 FurtherAfrica is an online platform centralising news and content focusing on the development and growth story of the African continent.

Related Posts

Tanzania Total oil pipeline
Natural Resources

Tanzania to revive US$30B LNG project

by Staff
April 12, 2021
FDI

Total poised to make US$5B bet on Uganda oil project

by Staff
April 12, 2021
Angola

Angola proposes African diamond-producing association reforms

by Staff
April 12, 2021
Privatisation

Cape Verde privatisation plan aims for less State and higher efficiency

by Martin Smith
April 12, 2021
Oil

Uganda, Tanzania, oil firms sign accords to build US$3.5B pipeline

by Staff
April 12, 2021
Next Post

Swedish Green power for Mozambique telco

Mozambique government proposes total ban on log exports

Angolan Airline to Fly to Mozambique

Leave a Reply Cancel reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.

2021 AFSIC
2022 Indaba Mining

FurtherAfrica Partners

The Exchange Club of Mozambique Taarifa Rwanda
CrudeMix Africa TechGist Africa Farmers Review Africa
Botswana unplugged Financial Insights Zambia Africa Oil & Power
Harambee Africa Novafrica  

Subscribe to FurtherAfrica

Enter your email address to receive notifications of new articles on your email.

Join 73,051 other subscribers.

FurtherAfrica

© 2021 FurtherMarkets

FurtherAfrica is a FurtherMarkets Limited platform

  • Countries
  • OpenTalk
  • Understanding
  • Videos
  • Weekend
  • About

Follow Us

No Result
View All Result
  • Countries
    • Angola
    • Botswana
    • Cape Verde
    • DRC
    • Eswatini
    • Ethiopia
    • Kenya
    • Malawi
    • Mauritius
    • Mozambique
    • Namibia
    • Nigeria
    • Rwanda
    • South Africa
    • Tanzania
    • Uganda
    • Zambia
    • Zimbabwe
  • OpenTalk
  • Understanding
  • Videos
  • Weekend
  • About

© 2021 FurtherMarkets

This website uses cookies. By continuing to use this website you are giving consent to cookies being used. Visit our Privacy and Cookie Policy.
Are you sure want to unlock this post?
Unlock left : 0
Are you sure want to cancel subscription?