Good afternoon. The International Monetary Fund (IMF) recently added its voice to the chorus of complaints about the shortage of foreign currency in Mozambique. Following the visit of an IMF team to the country at the end of last month, the team issued a statement calling for “greater exchange rate flexibility… to relieve FX [foreign currency] pressures and facilitate the reduction of external imbalances”.
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The reference to “imbalances” probably refers to the gap between the official and unofficial or “parallel” exchange rates, which the IMF says has increased. The NGO the Centre for Public Integrity (CIP) reported last month that the US dollar was worth about 74.25 meticals, compared to the official exchange rate of 63.91 meticals. The South African rand was worth just over four meticals on the unofficial market, compared to 3.54 at banks. CIP found that foreign currency was easy to obtain in large amounts on the black market, suggesting that the main problem is not shortage of funds, but the official exchange rate which keeps the value of the metical artificially high.
