Economic and Policy Analysis

The country’s main policies and strategies are embedded in the national long term vision, the Agenda 2025, and in the mid term Government Five-Year Programme for the period 2005-2009 along with its operational plan, the Plano de Acção para a Redução da Pobreza Absoluta (PARPA) for 2006-2009. Despite efforts to implement these policies and strategies capacity gaps persist within GoM chiefly relating to effective pro-poor policy planning and coordination of the various policy interventions. Improving the quality of policy and planning remains crucial to the achievement of the broader development goals,, including the MDGs of Mozambique.

Analysis, implementation, impact evaluation and monitoring capacities are equally as important, as are the motivation and the institutional systems and processes of management, training and implementation. The quality of institutional capacities and implementation will be substantially improved if the efforts to develop them are articulated, better rooted on the national context and the demand and capacities for better public governance are present. Also, planning and budgeting processes are not adequately linked and are not adequately integrated or harmonized horizontally across the sectors or vertically between the various administrative levels. Moreover, monitoring and evaluation processes and capacities vary massively across the sectors and between the different levels of government. Another worrying feature is that about 50% of annual government spending being met through external assistance, with huge demands for coordination and harmonisation of both aid and policies.

Positive milestones in furthering the Paris Declaration agenda have been recorded in Mozambique, particularly in the recent years with the advent of the new aid and funding modalities. Predictability of aid flows, however, is still low, especially in the medium term. Unpredictability of aid flows has a significant impact in lowering the ability of the GoM to utilise aid as a mid to long term development resource, and has a negative effect on macroeconomic stability in the short run. Some factors behind this unpredictability are attributed to the political and legal inability of many donors to commit resources in the mid to long run; aid conditionality; resilience of specific donor idiosyncrasies; slowness in implementation of the international commitments; deficiencies of the public finance management systems.

2. UNDP´s Economic Policy

3. Strategies

4. Key deliverables

5. Key partners