"Fiscal pressure" will remain "high" in the short term in the country, according to Banco de Moçambique, highlighting the 12.3% growth in total state expenditure in the first half of the year, compared to the same period in 2022.

A central bank report on the economic situation, quoted by Lusa, points out that "in the short term, fiscal pressure is expected to remain high, taking into account the ongoing negotiations on the implementation of the Single Wage Scale, debt service charges, the need for additional resources to deal with the 'El Niño' phenomenon".

The report also points to "other expenses associated with the electoral process", taking into account the local elections on October 11, "despite expectations of a relative improvement in state revenues, resulting from the measures associated with the gradual implementation of the Economic Acceleration Package and the improvement of the business environment".

According to the central bank, the report also points to an increase in public spending of 12.3% in the first half of the year, year-on-year, to 195,647 million meticais, meaning that this "fiscal execution reflects the continued pressure on the state's financial operations and operating expenses".

"Particularly personnel costs, in a context in which public investment remained constrained by limited financial capacity," the report reveals.

Meanwhile, the Bank of Mozambique also recognizes in this report the "improvement in Mozambique's current account balance", due to the "reduction in imports".

In the first half of the year, the value of exports of goods fell by the equivalent of 171 million dollars compared to the same period in 2022, justified by "the sharp fall in the prices of the main export goods on the international market".

In the same vein, imports fell by 4.1 billion dollars, but in this case this was explained by "the basic statistical effect", taking into account the incorporation in the first half of 2022 of the floating platform for the Coral South natural gas production project, valued at around 4.2 billion dollars.

"Among the main export products, only gas and heavy sands recorded increases, reflecting the volume effect, while the rest suffered significantly from the fall in prices on the international market," he added.

"It is expected that, in the short term, the volume of exports will continue to grow, favored by the continued improvement in the performance of major projects, especially natural gas and coal," concludes the Bank of Mozambique document.