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IMF Resident Representative Office in Mozambique |
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At a Glance — Mozambique and the IMF last updated: February 2004
The IMF has been active in supporting the efforts of Mozambique to reduce poverty by providing: (i) advice on macroeconomic policy with the goal of establishing and maintaining high rates of economic activity in an environment of low and stable inflation; (ii) financial support; (iii) technical assistance; and (iv) help in coordinating the implementation of tax and public expenditure management reforms. I. Macroeconomic Advice The IMF maintains an ongoing dialog with the Government of Mozambique and the Banco de Mozambique in an effort to provide sound economic advice that is consistent with achieving the Government's goals as stated in the PARPA. In particular, the goal of reducing absolute poverty will be greatly assisted by economic policies that create the conditions for high growth rates and low inflation. For general information on how the IMF works with its member countries see http://www.imf.org/external/work.htm Financial Assistance A. Loans Since 1987, the IMF has provided financial support to Mozambique through three of its lending facilities, namely the Structural Adjustment (SAF), Extended Structural Adjustment (ESAF), and Poverty Reduction and Growth (PRGF) facilities. For more information on IMF lending facilities see http://www.imf.org/external/np/exr/facts/howlend.htm
B. HIPC Debt Relief In 2001 the Executive Board of the IMF granted Mozambique debt relief for payments due on loans from the IMF under the Heavily Indebted Poor Countries (HIPC) initiative. The total amount of debt relief disbursed under this program to date is SDR 108 million. For information on debt relief extended to Mozambique by the IMF see http://www.imf.org/external/np/tre/tad/ II. Technical Assistance The IMF has provided and continues to provide significant assistance to Mozambique on a variety of topics by making available technical experts from within the IMF and drawn from the IMF's panels of outside experts. Generally these experts visit Mozambique for two to three weeks and prepare a report in which they provide advice to the Government of Mozambique or the Banco de Mozambique. The main focus of technical assistance provided by the IMF to Mozambique has been in the areas of: 1. Public Expenditure Management; 2. Tax Administration and Reform; 3. Income Tax Law; 4. Central Bank Accounting; 5. Banking Supervision; 6. Banking Payments Systems; 7. Commercial Bank Restructuring; 8. Balance of Payments Statistics; 9. Government Finance Statistics; and 10. National Accounts. Late in 2003, a joint IMF-World Bank team of experts concluded a comprehensive assessment of the Mozambican banking system. Such assessments have been done on almost all IMF member countries under the Financial Sector Assessment Program (FSAP). For general information about the FSAP see: http://www.imf.org/external/np/fsap/fsap.asp A summary of the assessment of the Mozambican financial system can be found at http://www.imf.org/external/pubs/cat/longres.cfm?sk=17229.0. III. Assistance in the Implementation of Tax and Public Expenditure Reforms In addition to making available experts who provide one-time advice to the Government, the IMF in Mozambique is also involved in longer term efforts to assist in the implementation of two key reforms in the area of public finances: namely, the reform of the tax system under the guidance of URTI (Unidade de Reforma Tributaria dos Impostos Internos) and the creation of a modern public expenditure management system under the guidance of UTRAFE (Unidade Técnica de Reforma da Administração Financeira do Estado) . The tax reform, which started in February 2001, aims to implement the personal and corporate income taxes (started in 2003) and in 2005 to create a central revenue authority, which will bring together customs and domestic tax operations under one administrative body. The public expenditure reform aims to put in place a system of expenditure management that will improve the Government's ability to manage public resources in a transparent and efficient manner. The Government of Mozambique asked the IMF to help with the implementation of these reforms and in response the IMF provided two experts in tax administration and one expert in public expenditure information systems, who are posted here in Mozambique, to provide advice on a daily basis to those Government officials responsible for the implementation of the two reforms. In addition, the IMF resident representative works to help coordinate the activities of the Government, the three IMF resident advisors, and the donors who provide resources for the two reforms. |