Mozambique’s stringent regulations governing external debt acquisition are beginning to yield tangible results as they exert influence on the nation’s public debt landscape.
Notably, in 2022, a significant milestone was reached as the external debt stock recorded a rare decline, contracting by 3.2% compared to the previous year.
This downturn in the net movement of the debt stock reflects a gradual deceleration observed in external borrowing disbursements over recent years. While this trend signifies a noteworthy shift, it only partially counteracts the escalating domestic borrowing, which continues to contribute to the overall debt burden.
Amidst these developments, strides have been made in enhancing fiscal transparency, notably by the Ministry of Economy and Finance. There has been a consistent effort to improve the quality and timeliness of fiscal performance data disclosure.
However, as the central government data quality and disclosure improves, the Mozambican authorities are now faced with a growing demand to widen the scope of its debt statistics wherein a notable gap remains in readily accessible granular data concerning municipality borrowing and corresponding municipal debt service.
In tandem with the recent inclusion of the SOEs debt into the Yearly Mozambique Public Debt Reports, the burning priority seems to now lie in addressing the disclosure of the Municipalities debt with potential implications to overall fiscal sustainability alongside those of the Central Government and SOEs.
Further Africa
