IMF’s financial support resumption signals good prospects for Mozambique – minister

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IMF
IMF

The International Monetary Fund (IMF)’s recent decision to approve a 470-million-USD aid program and resume the direct budget support for Mozambique signals good prospects for the country’s development process, the state-run Radio Mozambique (RM) reported on Tuesday.

The remarks were made by the Minister of Economy and Finance Max Tonela, who told RM during his visit to Washington DC that the move represents an important milestone in the country’s relations with the international financial market.

“With this program, we will also obtain additional resources for financing the economy, not only the resources that are in the agreement financed by the Fund, but also open the window of funding opportunities for other partners,” RM quoted Tonela as saying.

The minister revealed that the World Bank will directly support the state budget soon with a package of 300 million U.S. dollars later this year.

“We are also in the process of mobilizing several partners who needed this signal to formalize the support we have in our portfolio,” he said.

The implementation of the three-year program will start in June, with the improvement of public debt management and the macro-economic, fiscal, and structural reforms as priorities, according to the report.

The IMF’s decision for the resumption of direct support to the Mozambican state budget took place six years after its suspension due to the “hidden debt” scandal.

In 2016, the Mozambican government revealed that it had taken out loans of over two billion U.S. dollars in 2013 and 2014 for three state-owned, security-related companies without informing the parliament and the international donors, leading to the aid suspension from the IMF and most of the country’s donors. Enditem

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