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Mozambique’s Public Enterprise Sector Debt Falls Again in Q3 to 39.3B Meticals

Mozambique’s Public Enterprise Sector Debt Falls Again in Q3 to 39.3B Meticals

The accumulated value of the debt of the Mozambican State Enterprise Sector (SEE) fell by 3.6% in the third quarter, compared to the previous one, to 39.3 billion meticais, according to a government report that Lusa had access to on Thursday, 14 December.

In absolute terms, the accumulated value (stock) of the debt of around two dozen Mozambican public companies, or companies in which the state has a stake, fell by 1.4 billion meticais in three months, adding to the previous reduction of 646 million meticais between 31 March and 30 June, according to a report by the Ministry of Economy and Finance (MEF) on public debt.

The reduction in public debt in the third quarter, according to the document, is explained, among other factors, “by the retraction of domestic debt generated, to a large extent, by the fulfilment of debt servicing, as well as by the adoption of the measure of contracting new financing only when it proves to be essential and duly substantiated”.

“This performance is essentially due to the 7.30 per cent reduction in the domestic direct debt stock,” he adds.

Meanwhile, the government has previously identified natural disasters, public debt above sustainability limits, inflation and the performance of the State Business Sector as the main fiscal risks in 2024.

In this regard, in November, the World Bank warned that Mozambique’s state-owned enterprises represent the greatest potential danger to national public finances among African countries, accounting for almost 35 per cent of GDP, second only to the vulnerability registered in The Gambia.

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