Mozambique’s Informal Sector Demands Inclusion in Post-Electoral Recovery Credit Line

The informal sector in Mozambique is criticizing its exclusion from a 10 billion meticais credit line meant for post-electoral recovery, arguing that it is discriminatory as protests have affected all sectors. The sector contributes around 45% of GDP yet faces high loan interest rates, complicating access to financial assistance. Traders urge the government to acknowledge their contribution and provide support.

The informal sector in Mozambique has expressed strong discontent regarding its exclusion from the government’s 10 billion meticais credit line designated for post-electoral protest recovery. Traders argue that such exclusion constitutes discrimination, as all sectors have been affected by the protests. They assert that the informal sector, which significantly influences the national economy, deserves support as it contributes approximately 45% to the GDP, according to 2021 data from the National Institute of Statistics (INE).

Despite its economic significance, the informal sector’s exclusion from the credit line has been met with criticism. A representative of the sector stated, “If it does not cover them, it is discrimination. The protests covered everyone, no one escaped. So, in my opinion, it was important to cover the informal sector.” They emphasized the role of the informal sector in consumer impact, asserting that their visible business activities warrant financial assistance.

Moreover, informal workers have raised concerns about the exorbitant interest rates associated with loans, which further complicate their already challenging business environment. Financial institutions require guarantees from companies in order to approve access to the credit, which will be available from March 1 to September 30.

In summary, the informal sector in Mozambique is advocating for inclusion in the post-electoral recovery credit line, citing significant contributions to the economy and the collective impact of protests. The demand highlights ongoing challenges, including high interest rates and the necessity for equitable treatment across all economic sectors. Recognition of the sector’s importance is essential for fostering a comprehensive recovery process.

Original Source: clubofmozambique.com