Mozambican Prime Minister Carlos Agostinho do Rosario announced on Wednesday that due to Covid-19 threat the government has been forced to cut back its targets for this year.
Introducing the government’s Economic and Social Plan for 2020, and the accompanying state budget, to the Mozambican parliament, the Assembly of the Republic, Rosario said the government has been obliged to reduce its forecast for economic growth this year from four per cent to 2.2 per cent.
Reduced economic growth also means reduced revenue. Rosario expected revenues to fall by 26.3 billion meticais (about 393 million US dollars), “in a context when we are facing multiple challenges which demand more resources”.
In addition to the Covid-19 crisis, the Mozambican economy is also suffering from the ravages of armed attacks in two parts of the country, said Rosario, pointing to the Islamic terrorists in the northern province of Cabo Delgado, and the armed gangs, believed to be part of the self-styled “Renamo Military Junta”, the centre of the country.
He said the government has been mobilizing resources from its cooperation partners to finance the prevention and treatment of Covid-19, to support households and micro-businesses in the framework of strengthening social protection, and to cover the budget deficit arising from the fall in revenue associated with the slowdown in economic activity.
The challenges facing Mozambique said Rosario, “demand from us greater rigour in the selection of priorities and the allocation of the scarce resources available. We must ensure greater discipline in applying the resources of the state budget, guaranteeing that every metical spent on the priorities identified in the Economic and Social Plan has a greater impact in improving the lives of the people”.
For the coming months, he added, the top priority “is to continue safeguarding the health and life of the population, through implementing measures of prevention to avoid the spread of the coronavirus”.
At the same time, “we shall continue to prioritize territorial integrity and public order and tranquillity through strengthening the operational capacity of the defence and security forces, and assisting the affected population”.
Peace, the Prime Minister insisted, is “the necessary condition for the successful implementation”, both of this year’s plan, and the government’s five-year programme.
“We are convinced that only in an environment of effective peace will we be able to stimulate agricultural production, to increase the availability of food”, said Rosario. Banking on increased agricultural production “is of great importance to guarantee food security, particularly now, with the flow of imports restricted by the measures taken by various countries to prevent the spread of the coronavirus”.
He promised that the government would also prioritize the expansion of access to education, health care, water supply and decent sanitation, and the rebuilding of the infrastructures destroyed last year by cyclones Idai and Kenneth.
The Economic and Social Plan forecasts overall growth in the Gross Domestic Product of 2.2 per cent. The projections by sector include 1.5 per cent growth in mining, 1.8 per cent in agriculture, three per cent in construction, two per cent in transport and communications, one per cent in fisheries, two per cent in health and social welfare, 0.8 per cent in education and two per cent in the public administration.
The government hopes for an average annual inflation rate of 6.6 per cent, and for the country’s exports of commodities to reach more than 4.4 billion dollars. Mozambique’s net international reserves should reach 3.276 billion dollars, which is enough to cover 5.8 months of imports of goods and non-factor services.
In education, the Plan envisages recruiting 8,360 new teachers (mostly for primary education) and distributing 33,875 school desks, and over 21.7 million free school textbooks. The number of pupils per teacher in the first five grades of primary school should fall from 65.1 to 63.6.
In health, 4,846 new health workers will be recruited, including 269 doctors. The number of births in health units should rise from the 2019 figure of 87 per cent of the total to 88.9 per cent.
The number of children under the age of 12 months who are fully vaccinated should rise from 94 per cent in 2019 to 95 per cent in 2020.
The building of 11 district hospitals should be concluded, as well as the Nampula General Hospital. Two more general hospitals are planned (for Beira and Maxixe), and the Niassa Provincial Hospital in Lichinga will be rehabilitated and expanded.
As for agriculture, the government hopes for a 2020 harvest of 2.7 million tonnes of grain (which would be three per cent increase on 2019), 17.3 million tonnes of root crops, mostly cassava (a two per cent increase), and 859,000 tonnes of pulses (an increase of four per cent).
Turning to cash crops, the government expects to harvest 65,000 tonnes of cotton (an eight per cent increase on 2019), 142,000 tonnes of cashew nuts (a 1.4 per cent increase), and 99,000 tonnes of tobacco (a two per cent increase).
