Mozambique will have lost 120 jobs due to the pandemic

The World Bank estimates that Mozambique has lost 120.000 jobs due to the Covid-19 pandemic, said the institution's chief economist in Mozambique, Paulo Correa, today.

Maputo, Mozambique

“We have recorded a loss of 120 thousand jobs, with a greater incidence in the north of the country, which is worth mentioning due to the sensitivity of the region”, he referred, during the conference on “The Regional Economic Perspectives for Sub-Saharan Africa”, promoted today, via the Internet, by the International Monetary Fund (IMF).

The crisis affected the hospitality and tourism, transport and education sectors with greater incidence, not to mention the loss of job opportunities in the informal sector.

Even so, that official considered that the flexibility of the Mozambican labor law is allowing a greater capacity of resistance to the impact of Covid-19 by the private sector of the African country.

"The impact of Covid-19 on business and employment, in what can be considered the first wave, was profound, but less devastating [than in other countries] and this was achieved through flexible labor legislation," he said.

The use of suspension of employment contracts and reduction of wages - 'the lay-off' - allowed the safeguarding of many jobs and the survival of companies, stressed the main economist of the World Bank.

The priority of the social partners must be the protection of companies and jobs, mainly in the formal area, in the event of a second wave of the new coronavirus in the country.

"The focus on protecting the formal private sector has to do with the characteristics that make recovery difficult", because it requires new hires and training of personnel "to return to activity", stressed the World Bank's chief economist.

Regarding the Mozambican Government's response to the needs of companies vis-à-vis Covid-19, Paulo Correa considered them in line with the measures adopted by other countries, but he warned of the limited impact of some actions, especially those of a financial nature.

"In the case of a reduction in interest rates, if banks do not feel that there are mechanisms to reinforce the sharing of credit risk, they will not be more willing to grant credit," he said.

Mozambique today registered 69 new cases of infection with the new coronavirus, increasing the total to 15.770 and remaining with 131 deaths, the Ministry of Health announced in a statement.

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