The Ministry of Finance is preparing a new strategy to regularise the Mozambican government’s outstanding debt to suppliers of goods and services, estimated at 81.3 billion meticais and accumulated since 2017.
The announcement was made on Friday, 3 July, in Maputo by Alfredo Mutombene, National Director for Fiscal and Financial Analysis at the Ministry of Finance, during a meeting between the Government and the private sector held as part of the public dialogue with the Confederation of Economic Associations of Mozambique (CTA).
According to Mutombene, the first phase of the debt settlement strategy enabled the Government to clear a significant portion of its outstanding obligations. However, a remaining balance will now be incorporated into a second phase of the repayment plan.
“There is still an outstanding balance to be regularised, which will be included in this second phase of the supplier payment strategy,” Alfredo Mutombene said, as quoted by the Mozambique Information Agency (AIM).
The Government’s debt to suppliers is therefore divided into two main categories. The first consists of liabilities from previous years that have already been identified and partially settled. The second comprises claims submitted by private-sector companies that have accumulated since 2017 and must still undergo validation before being formally recognised and scheduled for payment.
The Ministry of Finance acknowledged that some claims submitted by companies have not yet been officially confirmed. As a result, the Government and the private sector are engaged in a technical dialogue to validate these amounts, with the possibility that part of the payments may only be made in 2027. The new strategy will therefore distinguish between debt already recorded in the public accounts, amounts validated for payment and claims that remain under verification. This distinction is considered essential for establishing the repayment schedule in a context of significant cash-flow constraints and the need to maintain control over public expenditure.
In May this year, the Minister of Finance informed Parliament that the value of outstanding government payment obligations had fallen from €417.5 million at the end of 2024 to €171.3 million at the end of 2025. At the time, the Government stated that settlement of these liabilities would depend on treasury availability throughout 2026, with some payments potentially being rescheduled.
Earlier this year, the Government also reported that its total identified liabilities to suppliers of goods and services stood at approximately 31 billion meticais, of which around 18 billion had already been paid by 2025, leaving 12.8 billion meticais still awaiting validation. The new estimate of 81.3 billion meticais now suggests a broader assessment of accumulated obligations, including claims submitted by the private sector that have not yet been formally recognised as validated public debt.
Settlement of Arrears Progresses Alongside Tax Reform
The issue of supplier debt was discussed during a meeting focused on measures to improve the business environment and promote fiscal policy stability, as part of preparations for the Annual Private Sector Conference, scheduled to take place in Maputo on 14 and 15 July.
During the same meeting, Alfredo Mutombene also addressed the tax reform package approved last year, which covered customs tariffs, the Special Consumption Tax and Corporate Income Tax.
However, he acknowledged that the period allocated for public consultation had been insufficient, with private-sector representatives requesting additional time to review the proposals.
“There were consultations with the private sector, but businesses requested more time to analyse the proposals,” he said, adding that the Ministry of Finance is currently repeating the consultation process as part of the review of other tax legislation, including Value Added Tax (VAT) and Corporate Income Tax (IRPC).
According to Mutombene, the Government recognises that future tax reforms should provide a minimum public consultation period of one to two months to allow businesses sufficient time to conduct a thorough assessment of proposed changes.
He also clarified that the 2025 tax package did not amend the tax exemption regime. Instead, it focused on broadening the tax base, incorporating previously under-taxed activities such as digital commerce, and simplifying tax payment procedures.
“There were no increases in tax rates or changes to the tax exemption regime. The focus was on expanding the tax base, promoting tax fairness and simplifying tax procedures,” he stressed.
Regarding VAT and Corporate Income Tax exemptions granted to certain sectors, particularly agriculture, Alfredo Mutombene explained that the matter remains under review and that no final decision has yet been reached. The tax incentives granted to the agricultural sector were originally approved for a two-year period, and any extension of these measures is still under discussion.
The settlement of outstanding supplier debt therefore remains one of the central issues in the ongoing dialogue between the Government and the private sector, at a time when many companies continue to identify delayed government payments as a major source of pressure on their cash flow, investment capacity and ability to meet their own financial obligations.
Source: Diário Económico
