ECONOMISTS SAY TENSION IS RETRACT ING INVESTMENTS CAUSING AND DEPRECIATION TO WORSEN

Economist Constantine Marrengula says
it is necessary, first of all, recognize that
the dollar is strong internationally, but
without forgetting that the domestic
conditions do not help because of
political and military tension and lack of clarity about the future. The academic
also said that one of the factors that
may be contributing to the depreciation
of the metical against the dollar is the
fact that the country has gone through
a time when public spending increased, which, in some ways, had an impact on
external transactions. He explains that
as public spending increases, the
probability of the exchange rate
depreciate is higher. "This depreciation
can only be minimized if there are some damping factors. In the past, we could
have it by way of foreign aid and
investment, but the investment is not to
come and, somehow, we have a process
dragged from political tension over the
past three years and no investor puts resources in such areas " stresses
Marrengula. The academic also said that
foreign aid is slow to arrive in the fact
that there are uncertainties about the
country's future. "The flag of the side of
the real economy problems and political context that is not very favorable is the
exchange rate," he says.