Mozambican economy 2001-2010 : a mix of economic populism and wild market

Abstract

This essay performs a general analysis of the economic evolution for the period comprised between 2001 and 2010 and it tries to define the main features according to an economic policy and political economy based upon paradigms of interdisciplinarity. The hypothesis of the study is to verify whether during the first decade of the 21st century there were policies and economic measures which can be defined by a growth model in which there is a combination of elements of a liberal economy at a micro level and a corporate public sector (State Capitalism) used, by the one hand, for the capture of income for the State and ruling party with off- budget financing, for the political elite and, on the other hand, for the application of redistributive measures mainly directed towards urban people so as to ensure alliances of power reproduction and the consolidation of an accumulation pattern internally focused, but centered out of the country. The practice of policies of the so-called economic populism is demonstrated through expansive monetary and budget policies, income adjustments above the inflation and high investment rates, mainly when the FDI is included. The populist nature is strengthened if the fact that the expansive policies are supported by external resources (to the State budget, in investment and in financing the balance of payments) and not by the wealth generated by the economy in public receipts is taken into consideration. Economic populism is also employed through the orchestration of public companies with politicized economic decisions. The consequence of these options were verified throughout the decade: increase of the deficit of the trade balance with growing imports; exacerbation of the dependency; high conjunctural variabilities in the exchange rate; increment of the public deficit (not including the external resources that finance the general State budget); the secundarization of the productive sectors that produce to the internal market and consequent prioritization of the exports of the large projects with the marginalization of the “traditional” productive fabric” and the externalization of the accumulation pattern. There are clear signs of the dual structure of the economy. The model of growth is not endogenous.