Communication - Presse

Standard Bank foresees average growth of 3.7% per year until 2025

Standard Bank Mozambique expects Mozambique’s economy to grow at an average of 3.7% per year between 2022 and 2025, a “slow” rate of growth given the country’s poverty rate, said Fáusio Mussa, the bank’s chief economist. [You may read the full Standard Bank’s Mozambique Economic Briefing, ‘Macro- economic up-date & outlook ‘, HERE]

The official was speaking in Maputo on Thursday at Standard Bank’s Economic Briefing, a public event analysing the economic situation in Mozambique.

The country “cannot grow alone” and “the Government has already understood the message”, he underlined, pointing out the need to attract foreign investment as key to accelerating development.

Standard Bank predicts gross domestic product (GDP) growth rates of 2.8% this year (excluding the impact of the war in Ukraine and global inflation risks), 3.7% next year, 4.1% in 2024 and 4.3% in 2025.

Mozambique does not, according to Standard Bank’s forecasts, escape the context of rising global prices, but will still have a “single-digit” inflation rate by the end of the year, said Fáusio Mussa. This is because of monetary policy; the offset is high interest rates, which only affect part of the population, in the face of a vast majority of people who are poor and very sensitive to inflation.

So, after a spike this year, Standard Bank predicts a pullback in inflation, with rates of 9.4% in 2022, 7.3% (2023), 6.5% (2024) and 5.9% (2025).

The bank’s chief economist reiterated the importance of diversifying the economy so that Mozambique is no longer dependent almost entirely on a reduced range of products or sectors – as is foreseen in relation to gas megaprojects.

According to the World Bank, between 62% and 63% of the Mozambican population lives in poverty, and Bernardo Aparício, newly appointed CEO of Standard Bank (in office since April 1), a speaker at the event, pointed to job creation in various sectors as a solution.

The leap to “a middle-income country” could happen with “a strategy localising [in the country] much of the production of what is consumed in Mozambique, and increasing industrialisation,” Aparício said.

Only by promoting the “rest of the value chain” will “more jobs” be created, capturing the informal economy, in which the majority of the population lives.

The challenge “for everyone in this room” is to convert foreign direct investment into investment that creates jobs, Aparício underlined.

According to him, “it is easy” to be in large projects, but “there is an opportunity” to focus on value chains, where small and medium-sized companies are present, and it is up to the bank to support this “ecosystem”.





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