The economic boost is expected to lead Mozambique to grow by 2.7% in 2025 and 3.5% in 2026, according to the African Development Bank (AfDB), which also outlines a set of “essential measures” in its analysis.
There’s a yearly rhythm to economic forecasting: following the traditional Spring Meetings forecasts by the International Monetary Fund (IMF) and World Bank (WB) in April in Washington, come the AfDB’s projections, usually released during its annual continental meetings in May, each year hosted by a different city. This year, Abidjan, Côte d’Ivoire, welcomed nearly 5,000 participants.
The AfDB foresees a “recovery of the extractive sector” in Mozambique, expected to drive GDP growth to 2.7% in 2025 and 3.5% in 2026, according to the country’s outlook section of the 2025 African Economic Outlook (AEO) report.
“Inflation is projected to rise to 4.8% in 2025 and increase further to 5.2% in 2026, due to higher prices of local food products,” the financial institution added.
Fiscal Deficit to Decrease in 2026?
The projections come after a moderate GDP growth of 1.8% in 2024, attributed to the decline in extractive and agricultural output, following 5.4% growth in 2023, the AfDB notes — also highlighting the drop in inflation: from 7% in 2023 to 3.2% in 2024.
Looking ahead, the budget deficit is expected to increase to 5.4% of GDP in 2025, and then decrease to 4.5% in 2026 as a result of fiscal consolidation.
Risks: Social Unrest and Global Uncertainty
The 2025 AEO was published at the end of May, during the AfDB’s Annual Meetings, which focused on mobilizing Africa’s internal resources to reduce dependence on external aid—a reaction to the tightening of development and humanitarian funding from the US and other donors.
For Mozambique, key risks to growth include climate change, social unrest and its economic impacts, cuts in foreign aid, and global trade tensions.
The AfDB also issued some policy recommendations:
- Urgently improve public spending efficiency (a long-standing concern among development partners)
- Combat illicit financial flows
- Exit the FATF’s grey list (FATF – Financial Action Task Force)
Resilience Persists Across the Continent
At the continental level, unsurprisingly, the AfDB revised its economic growth forecasts downward for this year and the next due to global market uncertainty.
“Amid recurring shocks and trade-related uncertainty, Africa’s growth outlook was cut by 0.2 and 0.4 percentage points, to 3.9% in 2025 and 4.0% in 2026, respectively.”
Still, 21 African countries are expected to surpass 5% growth in 2025, and 13 of the world’s 20 fastest-growing economies will be in Africa, the report notes.
These figures reflect “a resilience forged through hard-won gains from effective internal reforms, economic diversification, and improved macroeconomic management over the past decade,” stated the outgoing AfDB President, Akinwumi Adesina, in the report’s foreword.
Text: Editorial Team • Photo: D.R.
