Africa Banking Economy Finance Mozambique

8000 companies benefited from Bank of Mozambique credit line

Out of a total of 80,700 companies affected by the coronavirus pandemic, only 8,000 benefited from the US$500M credit line for imports, a study carried out by the National Statistics Institute (INE) between June and July reveals.

That few companies would benefit from the credit line had been anticipated since the announcement in late March. Indeed, many entrepreneurs and economists on the margins of the crisis openly criticised features of the credit line, but the Bank of Mozambique administration did not pay much attention.

In the midst of all the criticism, Director of the Bank of Mozambique Jamal Omar said in June that the credit line was not being properly absorbed by the economy, and that commercial banks had enough liquidity (or foreign currency money) to service their customers.

Also read: Bank of Mozambique cuts benchmark interest rate to 10.25%

In a section on the benefits and facilities granted by the state, the INE study, which aimed to measure the impact of the pandemic crisis on companies operating across the country, points out that a large number of companies (16,700) benefited from the suspension of some tax and contributory obligations, and that 12,200 companies benefited from loans at subsidised interest rates or state guarantees granted to mitigate the effects of the crisis.

As in the cases of the central bank’s credit line, the INE noted in the study that fewer companies – only 8,000 – benefited from the moratorium on payment of bank interest and credit capital.

By Evaristo Chilingue

Source: Carta de Moçambique via Club of Mozambique

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