Mozambican government predicts that extractive sector will lead GDP growth Link copied
Gold, rubies, coal, natural gas and heavy sands such as ilmenite, zircon and rutile all expected to provide significant contribution to nation’s economy.
Extractive industries will lead the growth of the Gross Domestic Product (GDP) in Mozambique in 2023, according to the proposed state budget.
Among 14 sectors, the government expects the Mozambican economy to grow by 5 per cent next year, with the largest contribution in the forecasts being the extractive sector, with a growth of 23.1 per cent.
The sector with the lowest contribution is expected to be trade, with 2.3 per cent.
The extractive sector was already at the top in 2021, when it contributed 10.7 per cent growth to Mozambican GDP.
“The extractive industry’s production plan for the year 2023 provides for a global growth of 23.1 per cent, supported by increased production of rubies, coal, heavy sands (ilmenite, zircon and rutile), natural gas and building materials”, reads the proposal.
Gold production is expected to rise by 23 per cent (to 1.3 tonnes) compared to projections for 2022.
In terms of heavy sands, which are important for new industrial applications and electronic devices, new concessions will be launched, including the largest in the country, due to the increase in world demand for ilmenite pigment.
With regard to graphite, with large reserves in Cabo Delgado to be exported for batteries for new electric cars, projections point to “a growth in production in the order of 48 per cent to 270 thousand tonnes”.
In the field of rubies, “production is estimated to increase by 186 per cent, representing 12.6 million carats”.
Coal will continue to rise, due to the global energy crisis, with the increase in production reaching 28 per cent and the export of liquefied natural gas from Rovuma starting in the coming weeks.
Of the three offshore liquefied natural gas projects approved for the northern region of Mozambique, the Coral Sul platform, far from armed violence in Cabo Delgado, will debut the export of reserves that are listed among the largest in the world.
The platform led by Italian oil company Eni will produce 3.4 million tonnes per year.
The gas has already started to be processed on the platform, awaiting the filling of the first cargo ship from BP, which bought the production for 20 years.
The proposal stated that “the international market appears to be open to trade in mineral resources and companies in the mining area have been resuming the normal pace of production”, resulting from the adaptation to a new reality.
The budget for 2023 is expected to be discussed by the Mozambican parliament before the end of the current session in mid-December.