conomy have been
liberalized to some extent. More than 900 state enterprises have
been privatized. A value-added tax, introduced in 1999, launched the
government's comprehensive tax reform program. Pending are much
needed commercial code reform and greater private sector involvement
in the transportation, telecommunications, and energy sectors. Since
1996, inflation has been low and foreign exchange rates relatively
stable. Albeit from a small base, Mozambique's economy grew at an
annual 10% rate in 1997-99, one of the highest growth rates in the
world. Growth slowed and inflation rose in 2000 due to devastating
flooding in the early part of the year. Both indicators should
recover in 2001. The country depends on foreign assistance to
balance the budget and to pay for a trade imbalance in which imports
greatly outnumber exports. The trade situation should improve in the
medium term, however, as trade and transportation links to South
Africa and the rest of the region have been improved and sizeable
foreign investments are beginning to materialize. Among these
investments are metal production (aluminum, steel), natural gas,
power generation, agriculture, fishing, timber, and transportation
services. Mozambique has received a formal cancellation of a large
portion of its external debt through an IMF initiative and is
scheduled to receive additional relief.

Namibia:
The economy is heavily dependent on the extraction and
processing of minerals for export. Mining accounts for 20% of GDP.
Namibia is the fourth-largest exporter of nonfuel minerals in Africa
and the world's fifth-largest producer of uranium. Rich alluvial
diamond deposits make Namibia a primary source for gem-quality
diamonds. Namibia also produces large quantities of lead, zinc, tin,
silver, and tungsten. Half of the population depends on agriculture
(largely subsistence agriculture) for its livelihood. Namibia must
import some of its food. Although per capita GDP is four times the
per capita GDP of Africa's poorer countries, the majority of
Namibia's people live in pronounced poverty because of large-scale
unemployment, the great inequality of income distribution, and the
large amount of wealth going to foreigners. The Namibian economy has
close links to South Africa. GDP growth in 2000 was led by gains in
the diamond and fish sectors. Agreement has been reached on the
privatization