The Government of Mozambique fully settled, in the first quarter of 2025, all overdue external debt service from 2024, which included payments owed to Portugal, according to a report by the Ministry of Finance accessed by Lusa on Sunday, June 1.
According to the document, the total amount of external public debt service reached 13.4 billion meticais (approximately 210.34 million USD), of which 8.6 billion meticais (about 136 million USD) corresponded to principal repayments and 4.7 billion meticais (about 74.34 million USD) to interest payments.
This amount represents an increase of 5.9 billion meticais (roughly 92.61 million USD), or 78.7%, compared to the fourth quarter of 2024, due to the full payment of carried-over arrears from the previous year. The report explains that, as part of the allocation of Special Drawing Rights (SDRs) by the International Monetary Fund (IMF) to finance the State Budget, Mozambique fully paid its debt service to the IMF in 2024.
In 2024, the country missed external debt payments totaling 3.3 billion meticais (around 52.5 million USD), more than half of which were owed to Portugal, due to difficulties linked to post-election political instability. These payments were carried over into 2025, creating additional pressure on the State Treasury.
The report highlights that the delay was mainly due to limited revenue collection, hampered by the post-election instability, which lasted five months after the October 9 general elections. Furthermore, the Economic and Social Plan and State Budget (PESOE) did not fully account for the funds required to cover debt service in 2024, resulting in a budget deficit that forced a rollover of obligations into the next fiscal year.
The Ministry of Finance emphasizes that carrying these amounts into 2025 adds further pressure to the State’s treasury, given the need to honor financial commitments in the upcoming fiscal year. This challenging scenario underlines the urgent need to implement effective measures to mitigate the risks associated with debt service and to optimize financial flows within the State.
Source: Diário Económico
