The Bank of Mozambique (BdM) has warned of high pressure caused by the state’s internal indebtedness, which has already grown by 90.3 billion meticais (1.4 billion dollars) this year to 402.7 billion meticais (6.2 billion dollars).
‘The pressure on domestic public debt remains high. This, excluding loan and lease contracts and overdue liabilities, stands at 402.7 billion meticais, representing an increase of 90.3 billion meticais,’ said the central bank.
In a document released after the ordinary meeting of the Monetary Policy Committee (CPMO), held on Monday 30 September, the BdM added that international reserves are currently at comfortable levels.
‘Gross international reserves continue to grow and are at levels sufficient to cover more than five months of imports of goods and services,’ the document reads.
Last week, the Mozambique Stock Exchange (BVM) announced that the country had placed 609 million meticais (9.4 million dollars) in an internal issue of Treasury Bonds with a maturity of five years.
According to the BVM, the operation took place on Tuesday 24 September and included bids submitted by operators specialising in Treasury Bonds, with the ratio between demand and supply being 22.51%. In total, bids totalling 1.2 billion meticais were registered.
This issue corresponds to the 10th series of 2024 Treasury Bonds, intended for direct subscription by specialised operators, with an authorised limit of up to 5.3 billion meticais.
The nominal interest rate is fixed at 15 per cent for the first four six-monthly interest
payments and variable for the last six.
Domestic debt reached 5.6 billion dollars in five months
Previous data from the Bank of Mozambique revealed that the domestic public debt totalled 364.2 billion meticais (5.6 billion dollars), after growing by around 51.9 billion meticais (805.1 million dollars) in five months.
‘The domestic public debt contracted between December 2023 and May 2024, excluding that resulting from loan contracts, leases and overdue liabilities, increased by around 51.9 billion meticais,’ the central bank said in its Economic Situation and Inflation Outlook report, released in June.
According to the document, overall, the debt issued domestically represented the equivalent of 23.7% of the national Gross Domestic Product (GDP) by 28 May, consisting mainly of Treasury Bills, with a stock of 99.8 billion meticais, and Treasury Bonds, which totalled 169 billion meticais, as well as 95.3 billion meticais in advances at the Bank of Mozambique.
The report also added that Mozambique’s international reserves ‘remain at comfortable levels’, with an accumulated balance of around 3.7 billion dollars, enough to cover around five months of imports of goods and services, excluding major projects.
