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Mozambique

Mozambique

Political and economic situation

Mozambique has been a multi-party democracy since 1990. Since the end of the civil war in 1992, the country has been one of the world’s fastest growing economies, with foreign investors attracted by untapped oil and gas, coal, and titanium reserves.

After recovering from severe floods and droughts in the early 2000s, Mozambique’s economy has performed strongly, with real GDP growth above 7% for over a decade. As a result of low exports and a decrease in public expenditure, due to ODA suspension and mounting public debt, as well as a decrease in foreign direct investment (-21% in 2015), GDP growth has decreased since 2015 to below 7%. For 2016, the Government of Mozambique estimated its GDP growth to reach just 4.5%. Over the same period, the inflation rate was expected to increase to 16.7%, limiting household purchasing power. In November 2016, Fitch ratings downgraded the country’s rating from CC to RD (Restricted Default).

As in previous years, the main drivers of growth were public expenditure and foreign direct investment, mainly in construction, power, business services, transport and communications, the financial sector and extractive industries. Poverty remains widespread, with more than 50% of Mozambicans living on less than USD 1 per day. With this in mind, the government has completely revised the legal and fiscal framework for the mining and hydrocarbon sectors, with a view to increasing revenues and enlarging domestic participation.

The lingering, low-intensity armed conflict between the government and the armed faction of the Resistência Nacional Moçambicana (RENAMO) had initially ended with a peace agreement in August 2014. Peaceful legislative and presidential elections were held in October of that year, after which Frente de Liberação de Moçambique (FRELIMO) emerged as the strongest party and its candidate Filipe Nyusi became President. However, renewed low-intensity conflict between the government and the RENAMO opposition party is on-going, with the latter not recognizing the outcome of the 2014 elections.

 

 

Key figures

Available statistics:
Capital
Maputo
Official language
Portuguese
Population (2015 est.)
25,930,150
Population growth (2016 est.), %
2.45
Median age (2016 est.), years
17.1
Urbanization rate (2010 - 2016), % p.a.
3.27
Urban population (2015), % of total
32.2
Rural population (2015), % of total
68
Population density (2015), per km2
36
HDI (2014), rank of 188
180
National Currency
Metical
Exchange rate (January 2017), USD
1 USD = 70 MZN
GDP (2015), USD million current
14,807.08
GDP growth (2015), %
6.6
GDP annual growth rate forecast (2020), %
3.7
GNI per capita (2015), current int’l USD
1,170
Inflation (2016), %
25.27
Inflation Rate Forecast (2020), %
16.5
Foreign Direct Investment, net inflows (2015), BOP current USD billions
3.868
Net official development assistance (2014), current USD millions
2,103
Budget deficit (2016), % of GDP
-8.8
Ease of Doing Business (2016), rank of 190
137
TI Corruption Index (2016), rank of 168
112
Installed Generation Capacity (2016), MW
2,626
Installed Fossil Fuel Capacity (2016), % of total installed capacity
17
Hydro Capacity (2016), % of total installed capacity
83
Other RE Capacity (2016), % of total installed capacity
0
Renewable electricity output as % of total electricity output excl. hydro (2016)
0
Avg. distribution and transmission losses as % of output (2013)
23
Net electricity imports (2014), kWh
7.7 billion
Electrification rate, total (2016) %
40
Electrification rate, urban (2016) %
67
Electrification rate, rural (2016) %
27
Peak demand (2014), MW
831
Per capita electricity consumption (2013), kWh
436
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