Good afternoon. Economic recovery is around the corner, or so the Mozambican government is claiming. For the past three quarters, the economy has shrunk owing to the debilitating effects of the protests sparked by last year’s disputed elections. Now ministers are saying that things could turn around when third quarter figures, for the period July-September, are published. Average GDP growth in the first half of the year was -2.4%, according to government figures. If the budget projection for this year is accurate and the economy grows by 2.9% overall (and that is a big “if), then it will need to grow by 5.3% in the second half. But since it is rebounding from a depressed state, that may be possible.
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If the comments of finance minister Carla Loveira are to be trusted, activity is picking up in sectors like agriculture, energy and infrastructure. The unfreezing of TotalEnergies’ massive gas project in Cabo Delgado should also help: locals in the province report seeing more job adverts posted in connection with the project.
But the government cannot just sit back and wait for the recovery to happen. Investors, particularly foreign investors, are still wary about the investment climate in the wake of the post-election protests. Concerns about political stability, however, seem to have been overtaken by concerns about government policy and regulation, and how predictable and supportive that is for businesses.
