Mozambican businesspeople yesterday once again complained of a shortage of foreign currency in the interbank market, indicating that the liquidity shortage could jeopardize equipment imports by companies affected by the post-election protests.
“Currently, in the market, we have companies with import invoices unpaid for more than nine months and with the respective terms of commitments outstanding. These foreign currency liquidity constraints could affect the process of importing equipment and accessories for companies affected by the protests,” said Paulo Oliveira, president of the communications and services department of the Confederation of Economic Associations (CTA) of Mozambique.
The Monetary Policy Committee (CPMO) of the Bank of Mozambique decided on Monday to reduce the mandatory reserve ratios for liabilities in national currency from 39.0% to 29.0% and in foreign currency from 39.50% to 29.50%, with the aim of providing more liquidity to support the economy in restoring its productive capacity and supplying goods and services.
At a press conference in Maputo, the CTA welcomed the measures, but called on the central bank to accompany the measure of reducing mandatory reserves in foreign currency with “further reductions and interventions in the interbank foreign exchange market”, making more foreign currency available.
“The Bank of Mozambique must curb the process of purchasing foreign currency on the market so as not to further suffocate the already limited sources,” Oliveira affirmed.
Mozambican businesspeople insist that liquidity in foreign currency remains low, saying actions by the central bank had “sucked” up, through mandatory reserves, around US$2.1 million in 2024 to cover external debt service.
With regard to the mandatory reserve coefficients for liabilities in national currency, which fell from 39.0% to 29.0%, the CTA indicated that the decision will “further increase liquidity”, but recalled that the great challenge for local businesspeople has been their “exclusion from financing by commercial banks in preference to treasury bills”.
Also on Monday, the central bank decided to further reduce the MIMO monetary policy interest rate from 12.75% (in force since the end of November last year) to 12.25%.
Businesspeople maintain that the Bank of Mozambique’s measures will only have positive effects on the economy if they are “combined and reinforced with the rapid introduction of the Mutual Guarantee Fund and, in the medium to long term, by the reform of the monetary policy framework”, Oliveira argued.
Source: Lusa
