Consultants NKC African Economics recently found that economic activity in
Mozambique this quarter will remain subdued, after the 2.4% drop in the last quarter of 2020, which prompted a 1.2% recession that year.
“Economic activity will remain subdued in the first quarter due to the continuation of the Covid-19 pandemic containment measures announced on January 15, the flooding caused by Tropical Cyclone Eloise, and the attacks in Cabo Delgado,” the analysts write.
According to the African branch of Oxford Economics, “figures on the evolution of economic activity, for the last quarter of last year, indicate that economic growth was lower than expected, after after having recorded relatively benign contractions in the second and third quarters due to resilient agricultural production.
Last year, Mozambique’s economy posted a 1.2% drop, which compared with the forecast of a fall of 0.3% advanced by these consultants, who explain the difference with “a much larger contraction than expected in the last quarter of 2020.
This drop, “the first in more than 20 years, was driven by the covid-19 pandemic, but it also reflects the sustained drop in production since the hidden debts scandal and the decline in commodity prices.”
Recently, the National Statistics Institute (INE) announced that GDP fell 1.28%
in 2020, reflecting the impact of the Covid-19 pandemic.
“GDP at market prices showed a change of -2.37% in the fourth quarter of 2020 compared to the same period of the previous year, and in cumulative terms of the four quarters of 2020 stood at -1.28%,” the document reads.
Only the first quarter of 2020 recorded growth compared to the same period of the previous year, an increase of 1,68%.
In the remaining quarters, the economy retracted, mainly due to restrictions on restrictions on activity imposed to contain the pandemic imposed to contain the pandemic, reflected in the economic slowdown.
