The Bank of Mozambique (BoM) reported that domestic public debt rose significantly over 2024, totalling an increase of around 325 million dollars (20.7 billion meticals) compared to the previous year. According to a statement issued after Monday’s Monetary Policy Committee (CPMO) meeting, the country’s domestic debt, excluding loan contracts, leases and outstanding liabilities, totalled 7.3 billion dollars (466.4 billion meticals).
The BoM warned that this increase reflects the growing pressure on public finances. The statement emphasises the need for measures to contain indebtedness, in an economic context that remains challenging.
On the other hand, the Ministry of Finance assured that it is committed to honouring its financial commitments, while implementing reforms to reduce the public debt burden. Among the initiatives underway, the government announced the introduction of debt exchange auctions and new issuance instruments to boost the secondary market, increasing the participation of institutional investors, families and individuals.
The new finance minister, Carla Alexandra Loveira, recognised the need to restructure public debt, pointing out that the 2024 post-election demonstrations had a direct impact on state revenues.
According to the minister, accumulated tax losses during the year totalled 639 million dollars (40.8 billion meticals), of which 213 million dollars (13.6 billion meticals) in December alone.
The BoM also pointed out that the cost of servicing the external debt rose 13% in the third quarter of 2024, totalling 280 million dollars (19.3 billion meticals), including interest and amortisation.
The political and economic tensions that marked 2024, especially after the general elections in October, resulted in violent clashes and the destruction of public and private infrastructure, further aggravating the fiscal scenario. The demonstrations, organised by the main opposition, Venâncio Mondlane, and triggered by the contestation of the election results, contributed to significant losses in tax revenue.
The government reaffirmed its commitment to managing public debt in accordance with the Medium Term Debt Strategy 2022-25, adopting measures to reduce financial burdens and ensure fiscal sustainability. The Bank of Mozambique emphasises the need for structural actions to control internal and external indebtedness, with a view to ensuring greater economic stability in the future.