Overdue invoices totaling 205.14 million meticais have been settled by September – MEF
The government guarantees that by September it had settled the equivalent of almost 205 million meticais in overdue payments from previous years with suppliers of goods and services, according to documents that Lusa had access to on Tuesday, November 14.
In the report with the economic and social balance of the implementation of the State Budget up to the third quarter of 2023, the Ministry of Economy and Finance explains that in the amortization of domestic debt, in addition to the amounts relating to the payment of Treasury Bonds and Bank Financing, “the amount of 197 million meticais was also disbursed”.
This, it adds, is an amount referring to “the payment of debts with suppliers of goods and services from previous years, within the scope of Fiscal Restructuring and Consolidation”.
In the same document, the government guarantees that the debt owed to suppliers was 697.5 million meticais at the end of 2022, which is down to 500.5 million meticais at the end of September.
The Confederation of Economic Associations (CTA) of Mozambique proposed on Thursday the inclusion of a line item in the State Budget for 2024 to settle the state’s arrears to entrepreneurs, which they estimate at US$400 million.
“The continuous accumulation of unpaid invoices to suppliers by our state means that our SMEs [Small and Medium-sized Enterprises], for the most part, are financing the Mozambican state, thus limiting their growth. Public spending, in a similar situation, ends up being adverse and damaging to our economy,” said CTA president Agostinho Vuma.
Speaking in Maputo at the opening of the Economic Briefing, a quarterly event in which the CTA presents its balance sheet and economic outlook to businesspeople, which coincides with the Assembly of the Republic’s discussion of the Economic and Social Plan and State Budget (PESOE) for 2024, Vuma insisted that the government should adopt a “limit on the state’s indebtedness to the private sector” in that document, thus curbing the accumulation of late payments.
According to the official, this would be a “way of helping to limit the growth of overdue invoices, but also to increase discipline over the state’s accounts. This would provide predictability and a reasonable economic projection so that our private sector is more aware of all the situations that affect the performance of companies,” he explained.
In addition, the CTA also proposed that next year’s State Budget should include a “specific heading” for the payment of overdue invoices to suppliers of goods and services.
“But also to Mozambican entrepreneurs, even if only partially. Because this is what prevents payment and, on the other hand, accumulates the state’s debt to the private sector. If we add up the amount accumulated in overdue invoices, at around 400 million US dollars, the ‘stock’ of credit to the state is estimated at around 4.7 billion dollars,” he said, adding that the state’s private financial sector accounts for around 29% of the Gross Domestic Product.
“So we can imagine what that means for the fabric, mostly SMEs, which are eager for growth,” said the CTA president.
Vuma also called on the government to launch public tenders “with predictability in the availability of financial resources”, so that they can be implemented and the timetables met by companies.
