Mozambique's economy powers ahead

Maputo - Mozambique's economy grew by an estimated 6.5% in 2010 and the resource-rich country should post stronger numbers next year, said the International Monetary Fund (IMF).

High global food and fuel prices caused the 2010 growth figure to come in slightly below expectations, although the expansion rate was still among the highest in the world, the IMF said following a country visit this week.

Consumer inflation slowed to 13.78% in March from 15.23% in February. However,the IMF said the government and central bank did not intend to loosen monetary policy, which is mainly executed through targeting domestic money supply.

"With economic growth poised to return to pre-crisis levels, the authorities intend to keep economic policies relatively tight during 2011," the IMF said.

Mozambique has some of the world's largest untapped reserves of coal and is attracting huge foreign investment in projects to export the mineral.

The IMF did not give a specific growth forecast for 2011 - although the government is expecting 7.2% - due mainly to expectations of a strong performance by the farming sector.