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FAX: [258] (1) 490114

Flag description: three equal horizontal bands of green (top), black,
and yellow with a red isosceles triangle based on the hoist side; the
black band is edged in white; centered in the triangle is a yellow
five-pointed star bearing a crossed rifle and hoe in black
superimposed on an open white book

Economy

Economy - overview: One of Africa's poorest countries, Mozambique has
failed to exploit the economic potential of its sizable agricultural,
hydropower, and transportation resources. Agricultural output is at
only 75% of its 1981 level, and grain has to be imported. Industry
operates at only 20%-40% of capacity. Foreign assistance programs
supply the foreign exchange required to pay for imports of goods and
services. The peace accord, signed in October 1992, has improved
Mozambique's prospects. The restoration of electrical transmission
lines to South Africa and the completion of a new transmission line to
Zimbabwe (permitting the giant Cahora Bassa hydropower plant to export
large amounts of electricity), proposed construction of a natural gas
pipeline to South Africa, and reform of transportation services will
greatly improve foreign exchange receipts. The Mozambique and South
African governments are developing the Maputo corridor, linking the
port of Maputo with Witbank, South Africa. In the past few years, more
than 500 state enterprises have been privatized, including the
country's largest commercial bank and a number of sizable
manufacturing firms. Other pending reform measures are the
privatization of customs operations, the reform of tax collection, and
the facilitation of private enterprise in the transportation, energy,
and telecommunications sectors.

GDP: purchasing power parity - $12.2 billion (1995 est.)

GDP - real growth rate: 3% (1995 est.)

GDP - per capita: purchasing power parity - $670 (1995 est.)

GDP - composition by sector:
agriculture: 33%
industry: 12%
services : 55% (1994 est.)

Inflation rate - consumer price index: 22% (1996 est.)

Labor force: NA
by occupation: 80% engaged in agriculture
note: in 1993, 47% of the wage earners were employed in industry, 28%
in transportation and communication; traditionally, a large number of
Mozambicans work abroad

Unemployment rate: 50% (1989 est.)

Budget:
revenues: $252 million
expenditures : $607 million, including capital expenditures of $NA
(1992 est.)

Industries: food, beverages, chemicals (