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Mozambique Economy Profile 2017

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Economy - overviewAt independence in 1975, Mozambique was one of the world's poorest countries. Socialist policies, economic mismanagement, and a brutal civil war from 1977 to 1992 further impoverished the country. In 1987, the government embarked on a series of macroeconomic reforms designed to stabilize the economy. These steps, combined with donor assistance and with political stability since the multi-party elections in 1994, propelled the country’s GDP from $4 billion in 1993, following the war, to about $35 billion in 2016. Fiscal reforms, including the introduction of a value-added tax and reform of the customs service, have improved the government's revenue collection abilities.

In spite of these gains, more than half the population remains below the poverty line. Subsistence agriculture continues to employ the vast majority of the country's work force. Citizens rioted in September 2010 after fuel, water, electricity, and bread price increases were announced. In an attempt to lessen the negative impact on the population, the government implemented subsidies, decreased taxes and tariffs, and instituted other fiscal measures.

A substantial trade imbalance persists, although aluminum production from the Mozal Aluminum Smelter has significantly boosted export earnings in recent years. In 2012, the Mozambican Government took over Portugal's last remaining share in the Cahora Bassa Hydroelectricity Company, a significant contributor to the Southern African Power Pool. The government has plans to expand the Cahora Bassa Dam and build additional dams to increase its electricity exports and fulfill the needs of its burgeoning domestic industries.

Mozambique's once substantial foreign debt was reduced through forgiveness and rescheduling under the IMF's Heavily Indebted Poor Countries (HIPC) and Enhanced HIPC initiatives. However, in 2016, information surfaced revealing that the Mozambican Government was responsible for over $2 billion in government-backed loans originally secured between 2012-2014 by state-owned defense and security companies without parliamentary approval or national budget inclusion, which prompted the IMF and international donors to halt direct budget support to the Government of Mozambique. This sizable external debt burden, donor withdrawal, elevated inflation, and currency depreciation contributed to weak growth in 2016 and forebode weaker economic growth in the next few years.

Mozambique grew at an average annual rate of 6%-8% in the decade leading up to 2015, one of Africa's strongest performances, but growth slowed in 2016 to about 3.5% as low commodity prices reduced export earnings. However, many forecasts predict an increase in growth in 2017 as coal exports grow. Two major international consortiums are seeking approval to develop massive natural gas deposits off the coast of Cabo Delgado province, in what has the potential to become the largest infrastructure project in Africa. The government predicts sales of liquefied natural gas from these projects could generate several billion dollars in revenues annually sometime after 2022.
GDP (purchasing power parity)$35.01 billion (2016 est.)
$33.79 billion (2015 est.)
$31.7 billion (2014 est.)
note: data are in 2016 dollars
GDP (official exchange rate)$12.05 billion (2016 est.)
GDP - real growth rate3.6% (2016 est.)
6.6% (2015 est.)
7.4% (2014 est.)
GDP - per capita (PPP)$1,200 (2016 est.)
$1,200 (2015 est.)
$1,100 (2014 est.)
note: data are in 2016 dollars
Gross national saving5% of GDP (2016 est.)
14.7% of GDP (2015 est.)
29.5% of GDP (2014 est.)
GDP - composition, by end usehousehold consumption: 67.1%
government consumption: 23.2%
investment in fixed capital: 37.4%
investment in inventories: 4.3%
exports of goods and services: 31.3%
imports of goods and services: -63.3% (2016 est.)
GDP - composition by sectoragriculture: 25.3%
industry: 19.8%
services: 54.9% (2016 est.)
Population below poverty line46.1% (2015 est.)
Labor force13.31 million (2016 est.)
Labor force - by occupationagriculture: 81%
industry: 6%
services: 13% (1997 est.)
Unemployment rate22.4% (2014 est.)
17% (2007 est.)
Unemployment, youth ages 15-24total: 39.4%
male: 40.2%
female: 38.7% (2012 est.)
Household income or consumption by percentage sharelowest 10%: 1.9%
highest 10%: 36.7% (2008)
Distribution of family income - Gini index45.6 (2008)
47.3 (2002)
Budgetrevenues: $2.554 billion
expenditures: $3.609 billion (2016 est.)
Taxes and other revenues21.2% of GDP (2016 est.)
Budget surplus (+) or deficit (-)-8.8% of GDP (2016 est.)
Public debt100.3% of GDP (2016 est.)
75.8% of GDP (2015 est.)
Inflation rate (consumer prices)17.1% (2016 est.)
3.6% (2015 est.)
Central bank discount rate9.5% (17 January 2013)
3.25% (31 December 2010)
Commercial bank prime lending rate24.9% (31 December 2016 est.)
14.87% (31 December 2015 est.)
Stock of narrow money$3.961 billion (31 December 2016 est.)
$4.758 billion (31 December 2015 est.)
Stock of broad money$7.48 billion (31 December 2015 est.)
$7.871 billion (31 December 2014 est.)
Stock of domestic credit$4.702 billion (31 December 2016 est.)
$5.565 billion (31 December 2015 est.)
Market value of publicly traded shares$NA
Agriculture - productscotton, cashew nuts, sugarcane, tea, cassava (manioc, tapioca), corn, coconuts, sisal, citrus and tropical fruits, potatoes, sunflowers; beef, poultry
Industriesaluminum, petroleum products, chemicals (fertilizer, soap, paints), textiles, cement, glass, asbestos, tobacco, food, beverages
Industrial production growth rate2.1% (2016 est.)
Current Account Balance-$4.386 billion (2016 est.)
-$5.833 billion (2015 est.)
Exports$3.132 billion (2016 est.)
$3.413 billion (2015 est.)
Exports - commoditiesaluminum, prawns, cashews, cotton, sugar, citrus, timber; bulk electricity
Exports - partnersSouth Africa 21.2%, China 10.6%, Italy 9.4%, India 8.8%, Belgium 8.2%, Spain 4.6% (2015)
Imports$5.151 billion (2016 est.)
$7.577 billion (2015 est.)
Imports - commoditiesmachinery and equipment, vehicles, fuel, chemicals, metal products, foodstuffs, textiles
Imports - partnersSouth Africa 23.6%, China 19.7%, India 14.2%, Portugal 4% (2015)
Reserves of foreign exchange and gold$1.541 billion (31 December 2016 est.)
$2.582 billion (31 December 2015 est.)
Debt - external$9.554 billion (31 December 2016 est.)
$9.743 billion (31 December 2015 est.)
Exchange ratesmeticais (MZM) per US dollar -
62.07 (2016 est.)
39.983 (2015 est.)
39.983 (2014 est.)
31.367 (2013 est.)
28.38 (2012 est.)
Fiscal yearcalendar year

Source: CIA World Factbook
This page was last updated on July 9, 2017

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