The Government, meeting on Tuesday, November 4, in a Council of Ministers session, approved the Medium-Term Public Debt Management Strategy for 2025–29, aimed at ensuring prudent debt management by maintaining a balance between cost and risk.
“The document was approved to meet the State’s financing needs while balancing cost and risk, in order to guarantee the credibility of economic policy and the sustainability of debt in the medium and long term,” reads a statement cited by Lusa.
In 2026, the Executive plans to allocate 122.7 billion meticais (1.9 billion dollars) to public debt servicing, equivalent to 7.4% of the projected Gross Domestic Product (GDP) for that year. Of this amount, 67.6 billion meticais (1.05 billion dollars) will go toward interest payments and 55.1 billion meticais (857 million dollars) toward debt principal repayment — a slight increase compared to the 120.6 billion meticais (1.8 billion dollars) budgeted for 2025, representing 7.8% of the estimated GDP for that year.
By comparison, debt servicing in 2024 was set at 105.6 billion meticais (1.6 billion dollars), equivalent to 7.2% of that year’s GDP. The Government justifies the budgetary effort as necessary to fully meet the State’s financial commitments, thereby reinforcing confidence in public finances. In the first half of 2025, debt servicing expenses recorded a 7.5% decrease compared to the same period the previous year, totaling 27.2 billion meticais (424 million dollars), corresponding to 42.6% of the annual budget allocated for that purpose.
With the goal of defining a more sustainable debt management strategy, the Government hired the U.S. consulting firm Alvarez & Marsal to assist in drafting a public debt restructuring plan and a national strategy for the 2026–29 period. The hiring was formalized through a direct award under Resolution No. 34/2025 of October 22, approved by the Council of Ministers.
Headquartered in New York, Alvarez & Marsal is an international firm specializing in financial restructuring and performance improvement, known for its role in major cases such as the Lehman Brothers collapse.
Meanwhile, the Governor of the Bank of Mozambique, Rogério Zandamela, reiterated at the end of September that the current pace of public debt growth is unsustainable, calling for urgent measures to contain it. “It cannot continue to grow. The Government is doing everything possible to contain this debt to reasonable levels so that it does not create problems for the economy,” he warned, emphasizing that the increase in domestic debt threatens the normal functioning of the State securities market.
The most recent assessment by the Monetary Policy Committee pointed to mounting pressure on domestic debt, currently estimated at 454.4 billion meticais (6.1 billion dollars) — an increase of 38.8 billion meticais (522.2 million dollars) compared to December 2024.
Source: Diário Económico
