An International Monetary Fund delegation has begun a ten-day mission in Maputo to assess the conditions required to negotiate a new financing programme for Mozambique, continuing a process that was set in motion after the closure of the previous agreement between the two parties.
The mission, led by Pablo Lopez Murphy, is expected to hold meetings with the government, the Bank of Mozambique, the private sector, and financial institutions. Discussions will centre on the country's macroeconomic situation, ongoing reforms, and the conditions for a potential programme under the Extended Credit Facility.
According to the Ministry of Finance, the visit was requested by the government and is intended to assess compliance with the recommendations left by the IMF in June, when a separate mission visited Maputo to discuss the measures needed to restore macroeconomic stability and debt sustainability.
"This visit falls within the framework of the long-standing cooperative relationship between the Mozambican state and that international financial institution, and its central objective is to conduct an in-depth review of recent macroeconomic performance, the state of implementation of ongoing reforms, as well as future prospects for technical and financial cooperation," the Ministry of Finance stated.
The current negotiations trace back to April 2025, when the Mozambican government and the IMF decided not to proceed with the remaining reviews of the Extended Credit Facility programme then in force, opting instead to open discussions on a new agreement more closely aligned with the priorities and vision of the new administration.
The previous programme had been approved in May 2022, with financing of approximately US$468 million. By the time it was closed, Mozambique had received around US$343 million, disbursed across four tranches. The fifth and sixth reviews, which could have opened the door to further disbursements, ultimately did not proceed.
Since then, the authorities have sought to establish a new framework for financial cooperation with the IMF. In January of this year, President Daniel Chapo stated that concluding a new agreement with the Fund was considered a priority ahead of any broader negotiations on external public debt, stressing the need to first restore confidence among international partners.
The process reached a significant milestone in March, when Mozambique made a full and early repayment of US$701.4 million in obligations to the IMF. The payment covered financing previously extended through concessional instruments, including credit facilities from 2019 and 2020 and the Extended Credit Facility programme initiated in 2022.
The government explained at the time that it had used Net International Reserves to make the payment, and argued that the operation demonstrated the country's capacity to honour its financial commitments, while also contributing to reinforcing confidence among markets and international partners. Despite settling the debt, Maputo maintained its interest in a new programme. In April, government officials stated that the early repayment did not represent the end of the relationship with the IMF, but rather the beginning of a new phase of cooperation.
In June, a Fund mission was again in Maputo and initiated discussions on the policies considered necessary for a new agreement. At the time, the IMF identified as priorities the strengthening of the fiscal position, the reduction of public debt vulnerabilities, the reinforcement of monetary and exchange rate policies, the preservation of financial stability, improvements in governance, and the creation of conditions for private sector-driven economic growth.
The IMF also warned that Mozambique continued to face a difficult economic environment, characterised by subdued growth, pressures on public finances, debt vulnerabilities, and a persistent shortage of foreign exchange — a situation that has affected imports and business activity.
In its report on Mozambique published this year, the institution called for sustained fiscal consolidation and measures capable of reducing the state's financing needs, while protecting the most vulnerable segments of the population. The Fund also highlighted the need for reforms in the areas of governance, transparency, and the business environment.
The ten-day mission now under way represents a further stage in a process that began approximately eighteen months ago. The conclusions of the discussions are expected to determine whether conditions exist to advance to formal negotiations and, subsequently, to a potential technical agreement between the government and the IMF. No announcement has yet been made regarding the size of any potential new financing or the timeline for completing negotiations.
Source: Diário Económico
Original article: https://www.diarioeconomico.co.mz/2026/09/09/economia/financas/fmi-inicia-missao-de-dez-dias-para-avaliar-novo-programa-em-mocambique/
