On June 5th, the European Union Delegation to Mozambique, in partnership with the Minister of Industry and Trade, the EuroCam, and the Revista Exame, held the first session of a series of webinar “EUMozTakls” to discuss the impact of the global fall in commodity prices and implications for Mozambique and the African continent, particularly in the current context of the COVID-19 pandemic.
Six speakers took part of the webinar that was also open for the public to comment: Industry ad Trade Minister Carlos Mesquita; the EU Ambassador to Mozambique António Sánchez-Benedito Gaspar; Simone Santi, President of Eurocam; Pietro Toigo, Resident Representative of the African Development Bank in Mozambique; Adriano Nuvunga, Director of the Centre for Democracy and Development (CDD) and Fáusio Mussá, Administrator and Chief Economist of Standard Bank Mozambique. The moderator was Iris de Brito, Director of Exame.
For the opening intervention, Minister Carlos Mesquita spoke of the down effects the restrictions imposed by COVID-19 are having on the already fragile Mozambican economy. The Government, he said, adopted relief measures to help the private sector cope with the situation. He also spoke of the need to enhance and integrate information and communication technologies in order to, on the one hand, avoid the blockade on international trade and thus make it practical and, at the same time, contribute significantly to improving the business environment, transparency and flexibility in international transactions.
For Minister Mesquita, the Government's strategy to deal with the negative impact of COVID-19 consists of boosting production and the competitiveness of companies, stimulating the use of natural resources to boost the value chain, encouraging the modernization and diversification of the economy. In this regard, the 2020-2024 Government Plan highlights already the agricultural and industrial sectors, as well as job creation, as important targets
EU Ambassador António Benedito-Sanchez expressed his confidence in that the tradition economic integration of Africa through free trade zones, the major aim of the European Union, as well as the digitization of the economy.
Simone Santi, President of Eurocam, focused his analysis on the fall in the price of natural gas on the international market. For him, this does not necessarily mean the non-sustainability of the oil and gas business in the Rovuma basin. Santi is convinced that what will be decisive for the gas business will be the amount of natural gas reserves that Mozambique has in light of the global energy transition. Therefore, the continuation of mega-projects in the hydrocarbon sector will depend on the relevance of the product in that medium and longer future.
Pietro Toigo, Resident Representative of the African Development Bank in Mozambique, also focusing on the oil and gas industry, asserted that despite the need to rethink a new model of economic growth in Africa that adds value to resources, the LNG industry has great potential to serve, in the medium term, as a "lubricant" to Mozambique's economic growth.
Finally, Fáusio Mussá, Chief Economist of Standard Bank Mozambique reflected on commodity prices highlighting that, in the short-term, the negative effects of COVID-19 are expected to outweigh the positive ones. A positive effect to consider would be, as he put it, if this crisis forced civil society and the Government to think about a different economic model for Mozambique that would encourage commercial agriculture and substitute imports. The economic shocks of COVID-19 may change the incentives to investing in Mozambique to promote more local agricultural production that generates more employment. However, the results are unlikely to be observable in the short-term. But just by starting to think differently, it is already a positive sign, he concluded.
The webinar is available on Youtube
This webinar was held by the EU-Moz Talks, a communication project that integrates the European Union Delegation in Mozambique, the Ministry of Industry and Trade, Eurocam, and the private sector. The project aims to promote debates on relevant economic and social issues leading to specific actions by all stakeholders to promote the sustainable development of Mozambique. This Webinar was the second of a series of 4 scheduled for 2020.