The strength of the Mozambican business fabric grew by one percentage point to 29% in the third quarter of 2023, compared to the previous quarter, when it stood at 28%, the President of the Economic Associations-CTA, Agostinho Vuma, revealed today in Maputo.

"The trend in the business strength index in the third quarter of 2023 was a slight improvement after stagnating for two periods. The assessment of this business strength index is a growth of one percentage point and is therefore set at 29% compared to 28% in the previous quarter," he said, noting that "this performance, although higher than the previous quarter, is still quite fragile."

The reasons for this slow growth include the late start to agricultural marketing due to the effects of the floods, which obstructed the flow of products and consequently increased logistics costs; the increase in financial charges with banks, the mimo rate and compulsory reserves, which led to an increase in company indebtedness - they absorb 48.5% of bank loans; and the continuous increase in unpaid invoices to suppliers by the state, which means that, for the most part, Mozambican Small and Medium-sized Enterprises are financing the Mozambican state, "limiting their growth".

During the Econimic Briefing 2023During the presentation of the Business Robustness Index, Vuma said that the assessment took place in a context in which the national economy is moving at two speeds.

"One is driven by the major projects in the extractive sector, which is experiencing extraordinary growth. This is where we've highlighted the private sector's eagerness to get Area 1 projects back on track, led by Total Energies. The other speed is driven by the traditional sectors of our economy, where there is very slight, if not negative, growth, especially in manufacturing, fishing and construction," he noted.

According to Vuma, the fragility of the Mozambican economy requires the implementation of flexible instruments to contain shocks, particularly external ones.