In recent years, Mozambique’s public debt has reached worrying levels, standing at around 971.4 billion Meticais in 2023, equivalent to approximately USD 11.3 billion. This amount contracted both internally and externally from bilateral and multilateral creditors, imposes a heavy burden on public finances, restricting the government’s ability to invest adequately in the economy, especially in key social sectors such as health and education.
Mozambique’s public debt structure tends to change with a clear record of the increase in the proportion of domestic public debt over external debt. Between 2013 and 2023, the proportion of domestic public debt slightly more than doubled, from 14.7% to 32%, respectively. Therefore, until December 31, 2023, Mozambique’s public debt stock comprised 32% domestic debt, and 68% external debt. On the other hand, external public debt remains with a greater weight on the DPT, with a weight of 68%, and dominated by multilateral debt.

Some of the recommendations for the Government include: (i) The need for strategies that ensure long-term financial sustainability with a focus on transparency, accountability and collaboration with international creditors; (ii) Investing in essential areas such as health and education will improve the population’s quality of life and strengthen the country’s ability to generate future revenues, creating a virtuous cycle of growth. Debt forgiveness presents itself as a viable solution, which could free up critical resources to boost investments in infrastructure and public services, essential for sustainable progress. Read more...