Mozambique & Brazil - A Case for Collaboration

Transcrição

1 Mozambique & Brazil - A Case for Collaboration Business Potential 31 st March, 215 Maputo, Mozambique

2 2 Agenda 13: 13:15 Welcome by Standard Bank Mozambique 13:15 14:3 Lunch and interactive Presentations Country Economic overview Sectorial opportunities in the country 14:3 15: Networking 14:55 15: Closing

3 12 YEARS OF HISTORY IN MOZAMBIQUE Economic Update Stepping into the future & Beyond 31st March 215 Fausio Mussa Chief Economist Standard Bank - Mozambique

4 12 YEARS OF HISTORY IN MOZAMBIQUE Topics for discussion Establishing business in Mozambique/ Land Mozambican economy growth prospects Current account, foreign direct investment and currency Inflation Government finances Monetary policy and interest rate

5 (*) YEARS OF HISTORY IN MOZAMBIQUE Economic activity expected to remain strong but current floods could reduce GDP growth to 6,5% y/y Weak coal price is likely to discourage increase in production despite Nacala line coming on stream Low fuel prices expected to delay further the development of natural gas projects/lowering FDI Less accommodative monetary policy and fiscal consolidation required for macroeconomic stability PIB anual (Annual GDP) base29 9,9% 8,7% 7,4% 7,4% 7,1%7,3% 7,4% 5,8% 6,5%7,1% 6,5% Nominal (MT1^6) Cresc Real (Real Growth) 12% 1% 8% 6% 4% 2% % Activ.Imobiliar ias (Property) 7,% Activ.Financei ras (Financial Activities) 6,6% Transp.Arma z. e Comunicaçõe s (Transport Storage &Com.) 8,8% Estrutura do PIB 214 base 29 (GDP Structure 214 new base 29) Outros (Others) 22,6% Comércio (Trade) 1,1% Agricultura (Agriculture) 23,4% Construção (Construct.) 2,6% Pescas (Fisheries) 1,7% Ind.Extractiva s (Extractive Industries) 3,1% Manufactura (Manufacturin g) 11,3% Prod&Distrib Electr&Gás (Electricity & Gas) 2,9%

6 12 YEARS OF HISTORY IN MOZAMBIQUE Mozambique runs a structural current account deficit which has been financed by FDI and Donor Support Cimento (Cemment); 111; 1% Cerveja (Beer); 18,6;.2% Importaçoes (Imports 213 U$ million) Outros (Others); 3.791; 45% Medicamento s (Medicine); 125; 2% Bens de Capital (Capital Goods); 2.52; 24% Oleo Alimentar (Coocking Oil); 143; 2% Electricidade (Electricity); 262; 3% Cereais (Cereals); 356; 4% Automoveis (Vehicles); 58; 6% Combustiveis (Fuels); 1.112; 13% Combustiveis Reexportaçao (Fuels reexport); 32 ; 1% Exportaçoes (Exports 213 U$million) Algodao (Cotton); 99 ; 2% Others; ; 33% Aluminio (Allummium); 1.63 ; 26% Açucar (Sugar); 186 ; 4% Tabaco (Tobacco); 251 ; 6% Gas Natural (N Gas); 23 ; 6% Carvao (Coal); 53 ; 12% Electricidade (Electricity); 27 ; 7% Areias Pesadas (H Sands); 131 ; 3%

7 (9M) 214 (9M) USD 1^6 12 YEARS OF HISTORY IN MOZAMBIQUE Resources Sector (coal and natural gas) is the dominant player in terms of Foreign Direct Investment inflows (accounting for more than 8% on inflows), helping to finance current account deficit Total Industria Extractiva (Extractive Industries) 489,9 938, , , , ,4 Manufactura (Manufaturing) 85,9 1,1 317,1 391,6-143,7 652, Transporte Armanzenamento, Comunicações (Transport, 128,5 24,2 87,5 98,7 271,7 61,6 Warehousing, Comms) Agricultura (Agriculture) 142,2 1, 9,1 153,9 115, 421,3 Serviços Financeiros (Financial Services) 9,5 34,9 42,9 43,4 17,5 238,2 Comercio (Trade) 16,4, 5,5 71, 48,1 141, Imobiliario (Property) -1,9,8 14,3 4,6 137,4 191,2 Construção (Construction) -2, 8, 15, 28,7 63,2 112,9 Hoteis e Restaurantes (Hotels and Restaurants) 23,6 4,3 15,9 26,5 39,5 19,8 Produção e Distribuição de Electricidade Agua e Gas (Production and Distribution,,4 8,6-31,6 72, 49,3 of Electricity, Gas, Water) Outros (Others),3 4,8 2,9 432,4-5,3 453,1 Total 892,5 1.17, , , , ,8 Défice da Conta Corrente e Investimento Directo Estrangeiro (External Current Account Dedifict and FDI) Investimento Directo Estrangeiro (Foreign Direct Investment) Deficit da Conta Corrente (Current Account Deficit)

8 Dec-9 Feb-1 Apr-1 Jun-1 Aug-1 Oct-1 Dec-1 Feb-11 Apr-11 Jun-11 Aug-11 Oct-11 Dec-11 Feb-12 Apr-12 Jun-12 Aug-12 Oct-12 Dec-12 Feb-13 Apr-13 Jun-13 Aug-13 Oct-13 Dec-13 Feb-14 Apr-14 Jun-14 Aug-14 Oct-14 Dec-14 Feb-15 Dec-9 Apr-1 Aug-1 Dec-1 Apr-11 Aug-11 Dec-11 Apr-12 Aug-12 Dec-12 Apr-13 Aug-13 Dec-13 Apr-14 Aug-14 Dec-14 USD million Months MZM/USD & MZM/EUR MZM/ ZAR 12 YEARS OF HISTORY IN MOZAMBIQUE Following a long period of currency stability, supported by FDI/Reserves, local currency volatility to USD increased since Dec/214 trading above MZN/USD35. Central Bank annual net sales of foreign currency to support the market increased from USD623.4million in 213 to USD127.7 million in 214 but was insufficient to contain depreciation as reserves remained under pressure closing below target Reservas internacionais liquidas e cobertura de importações (Net international reserves and import cover) Reservas (Net International Reserves) Meses de cobertura (Import cover months) Taxas de câmbio no MCI (MCI foreign exchange rates) MZM/USD MZM/EUR MZM/ZAR

9 Dec/29 Mar/21 Jun/21 Sep/21 Dec/21 Mar/211 Jun/211 Sep/211 Dec/211 Mar/212 Jun/212 Sep/212 Dec/212 Mar/213 Jun/213 Sep/213 Dec/213 Mar/214 Jun/214 Sep/214 Dec/214 Mar/215 Jun/215 Sep/215 Dec/215 Previsão (Forecast) 12 YEARS OF HISTORY IN MOZAMBIQUE Metical appreciation to the SA Rand (3,9% y/y in 214) combined with stable administered prices (including fuels) and quick recovery from Q1 214 floods helped to contain inflation at low historical levels. Current floods combined with Metical weakness to the USD will drive inflation up but average is likely to remain within Government target of 5.1% Inflação - Moçambique (Moz Inflation (Fev215) 1,56% m/m 3,99% y/y 2,67% média (average) CPI? Beira,45% m/m 4,22% y/y 2,26% média (average) Maputo 1,23% m/m 2,9% y/y Nampula 2,61% m/m 6,68% y/y CPI? 3,62% média (average) 2,14% média (average) Inflação Moç.(Mozambique Inflation) Anual (Annual) Média (Average) Annual (forecast) Average (forecast)

10 Dec-9 Feb-1 Apr-1 Jun-1 Aug-1 Oct-1 Dec-1 Feb-11 Apr-11 Jun-11 Aug-11 Oct-11 Dec-11 Feb-12 Apr-12 Jun-12 Aug-12 Oct-12 Dec-12 Feb-13 Apr-13 Jun-13 Aug-13 Oct-13 Dec-13 Feb-14 Apr-14 Jun-14 Aug-14 Oct-14 Dec-14 Feb-15 Dec-9 Feb-1 Apr-1 Jun-1 Aug-1 Oct-1 Dec-1 Feb-11 Apr-11 Jun-11 Aug-11 Oct-11 Dec-11 Feb-12 Apr-12 Jun-12 Aug-12 Oct-12 Dec-12 Feb-13 Apr-13 Jun-13 Aug-13 Oct-13 Dec-13 Feb-14 Apr-14 Jun-14 Aug-14 Oct-14 Dec-14 Feb-15 % 12 YEARS OF HISTORY IN MOZAMBIQUE Monetary aggregates expected to grow at lower pace in the region of 19% from 28.3% private sector credit expansion last year and 22,2% M3 growth as inflation is likely to maintain an upward trend % Taxas de Juro do Mercado Monetário I. & Inflação Média Maputo (Interbank Money Market Interest Rates & Maputo Avegare Inflation) Inflação (Inflation FPC BTs 3M (3Month TBs) FPD Variação % anual de gregados monetários a/a e Taxa de Juro Prime Rate (Annual change in monetary agregates and prime lending interest rates) M3 Crédito a Economia (PSCE) Base Monetária (Reserve Money) Taxa de Juro Prime (Prime Lending Interest Rate)

11 12 YEARS OF HISTORY IN MOZAMBIQUE 215 budget is expected to be presented towards March-end by new Government JULY214 (214 Budget am m endm ent) New Budget Aug214 USD million % of GDP % change Fiscal Revenue , ,4 29,1% 5,6 Government Expenditure , , 46,6% 3,4 Fiscal Deficit ,5 (2.977,6) -17,5%, GRANTS 3.42., 968, 5,7% INTERNAL BORROWINGS (BOND) , 174, 1,% EXTERNAL LOANS , ,6 1,8% , ,6 17,5% Fiscal Revenues , ,1 24,7% 4,5 Non Fiscal Revenues ,6 299,4 1,8%, Consigned Revenues , 261,8 1,5%, Capital Revenues ,7 11,5,6%, discrepanc.? ,6 79,6,5% Total Revenue , ,4 29,1% 5,6,,% Current Expenditure ,8 4.62,5 27,% 3,2 Investment Expenditure , ,5 19,5% 3,7 internal component , ,9 8,6% 8,9 external component , ,6 1,9%, Total Expenditure , , 46,6% 3,4 GDP 214e , 17.34, MZM/USD 31,4 Expenditure at 47% of GDP is high Donor support remains important as it finances 32,5% of the deficit representing 5,7% of GDP in 214 Budget will remain under pressure as windfall capital gains tax is unlikely to be repeated this year External debt is growing towards sustainability limit of 4% NPV of GDP Government policies including tariffs placed some SOEs (State Owned Companies) cash flows under extreme pressure

12 12 YEARS OF HISTORY IN MOZAMBIQUE Thank you

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