The economic week in Mozambique was marked by key issues that directly influence the national economic environment. The International Monetary Fund (IMF) warned of the continuation of modest economic growth, stressing the urgent need to strengthen domestic revenue mobilization and improve public debt management.
During the presentation of the report “Regional Economic Outlook for Sub-Saharan Africa” in Maputo, the IMF’s resident representative, Olamide Harrison, explained that Mozambique’s economic recovery has been gradual and slower than expected. He added that the Government’s projections require a significant boost in the last quarter of 2025 in order to meet the established targets.
The IMF representative also noted that, to reach the goal of 1.3% annual growth, the country would need to record a quarterly increase of around 11%, something considered “very difficult” given the data available up to the third quarter. This assessment increases pressure to accelerate measures that stimulate national economic performance.
Rise in sovereign bonds amid expectations of an IMF agreement in 2026
In the same economic context, Mozambique’s sovereign bonds stood out in emerging markets, driven by confidence expressed by the President of the Republic, Daniel Chapo, regarding the possibility of securing a new financing program with the IMF in early 2026, according to Bloomberg. This expectation had an immediate impact on the behavior of Mozambican debt securities. Yields on the 900-million-dollar bond maturing in 2031 fell by up to 24 basis points, settling at 12.5%, the lowest level since 18 November. The drop helped narrow the spread between Mozambican bonds and U.S. Treasury bonds to 1,009 basis points, according to JPMorgan Chase & Co. index data.
According to Maciej Woznica, portfolio manager at Coeli Frontier Markets AB, based in Sweden, “the decline in yields was driven by President Daniel Chapo’s comments about engaging with the IMF with a view to securing funds.” This reaction shows that expectations of external financing continue to shape investor sentiment.
Forecasts point to a 3% increase in ruby production in 2026
Closing the economic week, the Government projects a 3% increase in ruby production capacity in 2026, surpassing four million carats. The projection results from the resumption of activities by one of the companies operating in the country and is included in budget forecasts, compared with the expected 3.9 million carats for 2025 and the four million produced in 2024.
The Government estimates total production of 4.1 million carats in 2026, noting that “this forecast is linked to the halt in production activities of the country’s third-largest ruby producer,” whose return is expected to boost national output. This is an essential sector for Mozambique’s exports.
Currently, around 70% of ruby production is destined for export, a percentage the Government aims to increase to 79% by 2029. However, revenues fell by 30% in the first quarter to 5.1 million dollars, below the 7.2 million recorded between January and March 2024, according to the Bank of Mozambique.
Despite the recent drop in revenues, the performance of the ruby sector remains one of the pillars of the economic diversification needed to counter the modest growth identified by the IMF. The projections for 2026, associated with the resumption of production, reinforce the sector’s relevance for the country’s economic future.
Text: Florença Nhabinde
