The post-election demonstrations that broke out in the last quarter caused an estimated 32.2 billion (around 504 million dollars) in damage to the Mozambican economy and led to the loss of more than 17,000 jobs nationwide.

The figures were released on Thursday (20) by the President of the Confederation of Economic Associations (CTA), Agostinho Vuma, during the presentation of the first Economic Briefing for 2025.

"Aggregating the figures for losses in all phases, we can say with certainty that the impact of the demonstrations was negative and cost the economy around 32.2 billion meticais, dragging down more than 17,000 jobs," said Vuma.

Cited by AIMThe Mozambican business community has revealed that around 51% of the 955 companies affected have suffered total vandalization and/or looting of their goods. However, as a way of ensuring the rapid recovery of companies directly affected by the demonstrations, the CTA proposes, among other things, the creation of a Business Recovery Fund.

"Alongside these measures, we propose restructuring the loans of customers affected by the protests and applying a regime identical to the protocol used during the COVID-19 pandemic to relax the regulatory requirements associated with these restructurings, so as to result in the easing of prudential requirements for the credit restructurings of these customers," he added.

Overall, and with regard to business performance in the last quarter of 2024, the Macroeconomic Environment Index registered a considerable decrease when compared to the third quarter of the same year, dropping from 53% to 50%.

"The national Business Robustness Index fell by five percentage points in the fourth quarter of 2024, compared to the third quarter, from 30% to 25%."

Therefore, in order to recover these indicators, the CTA proposes that the Bank of Mozambique create a compensation system for commercial banks that apply the Prime Rate with a negative spread, previously defined, for agriculture and industry, particularly agro-industry.

According to the entrepreneurs, this proposal could be materialized through a lower rate of compulsory reserves for banks that invest in agriculture, and/or a lower deduction of compulsory reserves from the credit that is granted to the agro-industry sector.

(Photo DR)