The national economy is beginning to recover from the economic contraction seen in 2020, and has attracted greater volumes of domestic and foreign investment, said Mozambique Finance Minister.
The African Development Bank has launched preparations for its next five-year Mozambique country strategy after a trying period that included cyclones, security challenges and the Covid-19 pandemic.
The African Development Bank, in coordination with Mozambique’s Ministry of Economy and Finance, hosted a workshop on 12, 13 and 16 May 2022 on the Bank’s 2018-2022 Country Strategy Paper completion report, which will detail the results of the strategy. The event also covered the new 2023-2027 Country Strategy Paper and a review of the Bank’s portfolio of projects in Mozambique. The event was attended by Country Manager Cesar Augusto Mba Abogo, National Director for Public Debt, Isabel Sumar, and Ester José Santos, Deputy Director in the Ministry, and was attended by about 80 participants, consisting of project implementation staff, executing agencies, and staff from the Ministry of Economy and Finance, the Bank of Mozambique, the Administrative Tribunal, and African Development Bank.
Speaking on day three of the workshop, Minister of the Economy and Finance, Ernesto Max Elias Tonela, said the national economy was beginning to recover from external shocks and the economic contraction witnessed in 2020. “The country has experienced considerable macroeconomic and political stability, which has attracted greater volumes of domestic and foreign investment, including the valuable contribution of the African Development Bank. I would like to reaffirm our commitment to strengthen cooperation with the African Development Bank,” the Minister said. He said the government’s strategy was in line with the pillars defined jointly with the African Development Bank for Mozambique.
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According to the 2022 African Economic Outlook, Mozambique’s economy is gradually recovering from the impact of Covid-19 and conflict in its Cabo Delgado region. Gross domestic product grew by 2.2% in 2021 from a 1.2% contraction in 2020, aided on the supply side by recovery in agriculture and mining, and on the demand side by exports and government expenditure, according to the report, published by the African Development Bank on 25 May. Gross domestic product growth is projected to surpass pre-pandemic levels by 3.7% in 2022 and 4.5% in 2023, partly reflecting mineral projects.
During the Covid-19 pandemic, the African Development Bank supported Mozambique to reduce the impact of the virus, including $42 million in emergency budget support to strengthen health systems, expand social security and assist the private sector. In the 2018-2022 period under review, the country also contended with security challenges and devastating cyclones.
Cesar Mba Abogo, Mozambique Country Manager for the African Development Bank, said the assessment of the previous country strategy should take account of the diverse range of experiences.
“The evaluation should also celebrate Mozambique’s resilience, as the period from 2018-2022 has certainly been traumatic, but rest assured that the Bank remains committed to the government and the people of Mozambique to face those shocks. A rigorous evaluation of the achievements of the CSP 2018-2022 and the identification of strategic and operational lessons learned will help us to better address the challenges ahead to drive an inclusive, equitable and sustainable economic recovery,” Mba Abogo said.
Mozambique’s 2018-2022 Country Strategy Paper was anchored in two pillars: the development of infrastructure to enable transformative, inclusive growth and job creation; and agricultural transformation and value chain development. Governance, climate resilience and gender equality were granted special strategic emphasis.
The African Development Bank’s combined active portfolio in Mozambique comprises 22 projects with a commitment over $1.05 billion, which is the second-largest in the Southern Region and the fifteenth-largest in Africa.