Table of Contents

  • The Trade Policy Review Mechanism (TPRM) was first established on a trial basis by the GATT CONTRACTING PARTIES in April 1989. The Mechanism became a permanent feature of the World Trade Organization under the Marrakesh Agreement which established the WTO in January 1995.

  • This second Trade Policy Review of Mozambique has provided us with a much better understanding of its trade and trade-related policies and of the challenges it faces. Our dialogue has been thorough and comprehensive, stimulated by the full and open engagement of his Excellency António Fernando, Minister of Industry and Trade, and his delegation, as well as the insightful comments made by the discussant, and the pertinent interventions by many Members.

  • The reforms pursued by Mozambique since its first Trade Policy Review in 2001have contributed to high economic growth of 8.7% on average per year during 2001-07, driven mainly by megaprojects financed by foreign direct investment and public spending largely financed by foreign aid. Mozambique remains committed to pursuing prudent fiscal and monetary policies. It has made efforts to reduce its public deficit (after arrears clearance and on cash basis) from 6.17% of GDP in 2001 to 3.9% in 2007, through improved expenditure management and tax administration and collection. Since its 2006 reform, which introduced the New Metical as the national currency, the Bank of Mozambique has maintained a restrictive monetary policy, with “price stability” as the major goal since 2007. Nevertheless, the rising oil and cereal prices on international markets have adversely affected Mozambique’s attempt to keep inflation at around 6-6.5%; the Consumer Price Index (CPI) for the capital city of Maputo recorded an annual rate of increase of 10.26% in December 2007.

  • Mozambique has produced positive economic results over the last decade. The economic environment has been transformed. Mozambique has a low diversified economy. It is dependent from agriculture. Mozambique recorded an average annual per capita income of US$362 in 2006 and this is estimated to have been US$466 in 2008. A combination of several factors: political stability, economic reforms, foreign investment flows, the gradual integration into regional markets and continued international donor support have created the conditions for high economic growth rates recorded in recent years.