Africa > Mozambique > Economy

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Agriculture > products cotton, cashew nuts, sugarcane, tea, cassava, corn, coconuts, sisal, citrus and tropical fruits, potatoes, sunflowers; beef, poultry
Aid as % of GDP	23.3%		[9th of 129]
Debt > External	$4,189,000,000.00		[99th of 136]
Distribution of family income > Gini index	47.3		[3rd of 43]
Economic freedom	1.75		[96th of 156]
Economy > Overview At independence in 1975, Mozambique was one of the world's poorest countries. Socialist mismanagement and a brutal civil war from 1977-92 exacerbated the situation. In 1987, the government embarked on a series of macroeconomic reforms designed to stabilize the economy. These steps, combined with donor assistance and with political stability since the multi-party elections in 1994, have led to dramatic improvements in the country's growth rate. Inflation was reduced to single digits during the late 1990s, and although it returned to double digits in 2000-06, in 2007 inflation had slowed to 8%, while GDP growth reached 7.5%. Fiscal reforms, including the introduction of a value-added tax and reform of the customs service, have improved the government's revenue collection abilities. In spite of these gains, Mozambique remains dependent upon foreign assistance for much of its annual budget, and the majority of the population remains below the poverty line. Subsistence agriculture continues to employ the vast majority of the country's work force. A substantial trade imbalance persists although the opening of the Mozal aluminum smelter, the country's largest foreign investment project to date, has increased export earnings. At the end of 2007, and after years of negotiations, the government took over Portugal's majority share of the Cahora Bassa Hydroelectricity (HCB) company, a dam that was not transferred to Mozambique at independence because of the ensuing civil war and unpaid debts. More power is needed for additional investment projects in titanium extraction and processing and garment manufacturing that could further close the import/export gap. Mozambique's once substantial foreign debt has been reduced through forgiveness and rescheduling under the IMF's Heavily Indebted Poor Countries (HIPC) and Enhanced HIPC initiatives, and is now at a manageable level. In July 2007 the Millennium Challenge Corporation (MCC) signed a Compact with Mozambique; the Mozambican government moved rapidly to ratify the Compact and propose a plan for funding.
Exports	$2,412,000,000.00		[116th of 189]
GDP	$7,608,191,000.00		[108th of 203]
GDP > PPP	$23,583,000,000.00		[96th of 163]
GDP > Real growth rate	7.3%		[41st of 198]
GINI index	47.29		[8th of 40]
Gross National Income	$3,800,270,000.00		[111st of 172]
Human Development Index	0.379		[169th of 178]
Income category	Low income
Income distribution > Poorest 10%	2.5%		[64th of 114]
Income distribution > Richest 10%	31.7%		[51st of 114]
Population below poverty line	70%		[3rd of 46]
Poverty > Share of all poor people	0.61 % of world's poor		[19th of 80]
Public debt	22.2 % of GDP		[89th of 121]
Technological achievement	0.07		[67th of 68]

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