The International Monetary Fund (IMF) yesterday downgraded Mozambique’s economy growth forecast to 3 percent this year and 2.5 percent next year, accelerating thereafter to 9.9 percent in 2023.
According to the World Economic Outlook, published yesterday at the institution’s headquarters in Washington, the estimate for the growth of the Mozambican economy this year represents a downward revision from the 5.3 percent that it foresaw in October last year.
For 2023, when natural gas megaprojects are expected to start generating large revenues, the IMF revised its projected growth downward from 14 to 9.9 percent.
The IMF expects the world economy to grow 3.9 percent this year, 0.1 percent up on the 3.8 percent growth recorded in 2017, the year with the fastest growth since 2011.
“World growth strengthened in 2017 to 3.8 percent, with a notable rebound in global trade. It was driven by an investment recovery in advanced economies, continued strong growth in emerging Asia, a notable upswing in emerging Europe, and signs of recovery in several commodity exporters,” the document released yesterday reads.
Released at the start of the Spring Meetings organised annually together with the World Bank, the report adds: “Global growth is expected to tick up to 3.9 percent this year and next, supported by strong momentum, favourable market sentiment, accommodative financial conditions, and the domestic and international repercussions of expansionary fiscal policy in the United States.”
The “partial recovery” in commodity prices should allow conditions in commodity exporting countries to improve gradually, although the IMF expects world growth to decline to 3.7 percent in the medium term.
While growth for 2018 and 2019 is at its highest level this decade, IMF analysts warn of an absence of confidence that the acceleration will continue.
“Upside and downside risks are broadly balanced over the next several quarters, but risks farther down the road are skewed to the downside,” the paper reads.
“With still-easy financial conditions and persistently low inflation that has required protracted monetary policy accommodation, a potential further build-up of financial vulnerabilities could give way to rapid tightening of global financial conditions, denting confidence and growth,” the IMF experts add.
Therefore, “the current favourable juncture offers a window to enact policies and reforms that protect the upswing and raise medium-term growth to the benefit of all”, strengthening the potential for higher and more inclusive growth.
They advocate “building buffers that will help deal more effectively with the next downturn, improving financial resilience to contain financial market risks, and fostering international cooperation”
- LUSA/ COM
