Mozambique’s economy contracted by 4.9% in Q4 2024, marking its first decline since Q4 2020 and the steepest since 2001. Key sectors such as hospitality and manufacturing were notably impacted, with declines of 14.7% and 11.14%, respectively. Contributing factors included climate-related disasters and post-election protests that resulted in significant civil unrest and a below-forecast GDP growth of 1.9% for the year.
Mozambique’s economy experienced a significant downturn in Q4 2024, with its GDP contracting by 4.9% year-on-year. This marked a sharp decline from a growth of 3.7% in the previous quarter, marking the first contraction since Q4 2020 and the most severe since at least 2001. The downturn highlights vulnerabilities in the nation’s economic structure.
The hardest-hit sector was hospitality, with a staggering decline of 14.7%. Manufacturing, trade and repair services, and mining also experienced substantial contractions of 11.14%, 10.64%, and 10.06%, respectively. These sectors’ struggles illustrate the multifaceted challenges facing Mozambique’s economy.
Compounding these challenges were climate-related disasters, including severe droughts and cyclones attributed to climate change. Furthermore, social and economic activities were severely disrupted following the general elections on October 9, 2024, which sparked protests and civil unrest throughout the country. The subsequent violence resulted in over 300 fatalities and substantial societal impacts.
Overall, Mozambique’s GDP growth for the year was approximately 1.9%, falling short of the government’s forecast of 5.5%. The disappointing growth figures reflect the severe economic and social challenges exacerbated by the events of late 2024, showcasing the significant need for structural reforms and improved responses to crises.
In summary, Mozambique’s economy faced a substantial contraction of 4.9% in Q4 2024, following a period of growth. This decline affected multiple sectors, particularly hospitality and manufacturing, and was exacerbated by natural disasters and political unrest. The nation’s GDP growth for the year fell well below expectations, underscoring the urgency for comprehensive reforms in the face of recurrent challenges.
Original Source: www.tradingview.com
