The head of the British Department for International Development (DFID) Mozambique, Keith Mackiggan believes that Mozambique could no longer need budget support by 2023, should the country manage to maintain current performance and economic indicators.

Mackiggan said in an interview that this is a conclusion of a group of DFID economists working on economic forecasting based on historical data and on the assumptions that Mozambique would maintain current economic growth rate (seven per cent per year), domestic revenue (0.5 per cent) as well as public expenditure (10 per cent).

To that end, the Mozambican government is working on a new strategy that is expected to be completed by next year, which is based on increasing tax collections and diversification of domestic public expenditure.
Over the next five years, UK will disburse 258 million pounds to Mozambique’s State Budget and to projects for country’s development. Despite the current world economic recession, UK has pledged to increase aid levels for poor countries, particularly Mozambique.

Mackiggan, however, warned that this sum could increase or decrease according to the performance of the Mozambican government. He was addressing the need for Mozambican government to fulfil its pledges in the fight against corruption, reduction of poverty levels and implementation of decentralization programs.
“This is not a fixed amount, as it may fluctuate according to a joint evaluation carried by both parties”, he explained.
For 2009, UK has granted 71 million pounds to the Mozambique, of which 44 million pounds for direct budget support, and the balance for a number of development projects in to be implemented in Mozambique.
According to DFID projections in 2010 and 2011 aid to Mozambique could reach 74 and 77 million pounds respectively. These donations represent an annual increase of three million pounds, based on current aid levels.
About 70 per cent of aid from the British government to Mozambique is for direct support of the State Budget, which is on line with DFID’s aid policies for development.

Mackiggan also said that besides strengthening the Mozambican economy, a strategy based on direct budget support would force the government to be more accountable to its people, as the funds use will have to be explained. This support seeks to improve primarily health and education sectors, with 40 million pounds per year.

“Our commitment is to improve the life standard of Mozambicans, mainly the poorest”, reiterated Mackiggan.
The British government also focus its attention in the development of infrastructures, including the construction of water supply systems and roads in the rural areas.
Meanwhile, Mackiggan reiterates the need to create favourable conditions for the private sector to boost investment in the country, by improving business environment. (AIM news)

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