The economic week was marked by developments considered favourable to the performance of the national economy, notably the Government’s announcement that the country will be removed from the International Financial Action Task Force (FATF) grey list in September this year.
Among other relevant measures, the Assembly of the Republic approved VAT exemption for essential products such as sugar, edible oils and soap until December 2025. At the same time, the Bank of Mozambique revealed that credit granted to the economy reached almost US$5 billion in April, and the state-owned airline LAM began a new phase of its restructuring process with the appointment of a new management team.
Removal from the grey list expected in September
The authorities announced that the country has already met all the requirements of the FATF, the body that oversees the implementation of measures to combat money laundering and terrorist financing. The final decision will be taken during the body’s meeting scheduled for September in Maputo.
‘We are just waiting for the formal procedures for Mozambique’s definitive removal from the grey list and the restoration of normality. We intend to no longer be identified as a country associated with money laundering. We want to regain the confidence of investors and international institutions,’ said Luís Abel Cezerilo, national coordinator for Mozambique’s removal from the list.
According to him, all technical indicators have already been met and only the formalities remain to be completed.
VAT eliminated on essential products
On Wednesday, 14 May, Parliament unanimously approved a bill exempting sugar, edible oils and soaps, as well as raw materials and machinery for the production of these goods, from Value Added Tax (VAT), valid until 31 December 2025.
The authorities announced that the country has already met all the requirements of the FATF, the body that oversees the implementation of measures to combat money laundering and terrorist financing. The final decision will be taken during the body’s meeting scheduled for September in Maputo.
The measure, which amends the VAT Code, aims to ease the cost of living for families and boost domestic production by reducing the tax burden on essential products and basic inputs.
The government estimates that this exemption will result in a tax loss of approximately 2.2 billion meticals (about 33.8 million dollars), stressing, however, that the economic and social benefits far outweigh the budgetary impact.
During the debates, all parliamentary benches expressed support for the proposal. The Mozambique Democratic Movement (MDM) called for strict monitoring of the measure’s implementation and advocated its extension to strategic sectors such as energy, water and education. It also reiterated its proposal to reduce the general VAT rate from 16% to 14%.
Parliament unanimously approved a bill exempting sugar, edible oils and soaps, as well as raw materials and machinery for the production of these goods, from Value Added Tax (VAT) until 31 December 2025
Credit to the economy grows in April
Credit granted to the national economy totalled around US$4.9 billion (276.8 billion meticals) in April 2025, representing a slight recovery from the previous month, according to the Monthly Summary of Statistical Information from the Bank of Mozambique.
According to the document, the figure for March was US$4.9 billion (275.9 billion meticals), showing marginal growth.
Individuals absorbed the largest share of credit, with US$1.5 billion (99.4 billion meticals), followed by the trade sector, with US$384.9 million (21.9 billion meticals). The transport and communications and manufacturing sectors also recorded significant figures, with US$437.1 million (24.9 billion meticals) and US$391.5 million (22.3 billion meticals), respectively.
Credit granted to the national economy totalled around US$4.9 billion (276.8 billion meticals) in April 2025, representing a slight recovery compared to the previous month, according to the Monthly Summary of Statistical Information from the Bank of Mozambique.
Average interest rates for new loans stood at 19.75%, reflecting a slight decrease compared to previous months.
LAM begins new phase of restructuring
In the aviation sector, the week was marked by the start of a new phase in the restructuring of Linhas Aéreas de Moçambique (LAM). On 13 May, it was announced that the previous management of the state-owned airline had been dismissed and a new management committee appointed.
According to a statement from the State Participation Management Institute (IGEPE), the decision was taken at an extraordinary general meeting of LAM, with immediate effect for the termination of the functions of the chairman of the Board of Directors, Marcelino Gildo Alberto, as well as the directors Altino Xavier Mavile (Finance, Human Resources and Corporate Services) and Bruno Miranda (Technical and Operational).
The new management structure will have a non-executive board of directors, composed of representatives of the public companies that this year became part of LAM’s shareholder structure: Portos e Caminhos-de-Ferro de Moçambique (CFM), Hidroeléctrica de Cahora Bassa (HCB) and Empresa Moçambicana de Seguros (Emose).
Text: Nário Sixpene
