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Spend or save?

The central bank governor's defence of orthodox financial policy has caused a stir

Today’s front pages in Maputo. Photo © Faizal Chauque / Zitamar News

Good afternoon. A speech last week by the governor of the Bank of Mozambique caused something of a stir, though it has taken a few days for it to make it into the papers; Canal de Moçambique featured it on its front page yesterday (see summary in today’s Daily Briefing below), and tomorrow, Savana will publish a response to the governor’s speech, by two eminent Mozambican economists.

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The speech, made at Mozambique’s polytechnic university (which can be downloaded here), is a defence of the hawkish monetary policy followed by the Bank of Mozambique under governor Rogerio Zandamela’s leadership. It is also a call for Mozambique to save more, to build up funds that could see it through crises.

His comments featured by Canal, that donors are tired of requests for more money, do not feature in the text of the speech published by the central bank, so were probably made unscripted. Nevertheless, even the scripted sections are causing controversy.

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