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Government to Borrow 45.7B Meticals to Pay for Public Spending in 2024

Government to Borrow 45.7B Meticals to Pay for Public Spending in 2024

The government will issue 24 Treasury Bonds (public debt securities) during the current year, two each month, totalling 45.7 billion meticals, to meet public operating expenditure (salaries) or investment in income projects, the Carta de Moçambique news portal reported this Thursday, 25 January.

According to the site, the amount represents an increase of nine billion meticals compared to 2023, when Treasury Bonds totalling 36.6 billion meticals were issued.

The information is contained in ministerial diploma no. 151/2023 of 29 December, approved by the Ministry of Economy and Finance, and which contains the schedule of issues whose auctions will be held on the Mozambique Stock Exchange (BVM).

According to the document, the amounts to be auctioned on the BVM range from 227 million meticals to 6.6 billion meticals, with the minimum amount in 2023 being 500 million meticals and the maximum amount being 4.2 billion meticals.

More detailed data from the statute shows that for the current month of January, the government has already issued Treasury Bonds, on the 10th and 17th, totalling 3.8 billion and two billion meticals respectively. In total, this month alone, the government has already borrowed 5.8 billion meticais to pay for public spending.

The document reveals that for the month of February, the Executive has scheduled two Treasury Bond issues for the 6th and 20th, totalling 519 million and 638 million meticals respectively. With these issues, it will have a total of 1.1 billion meticals in public debt in February.

A Treasury Bond issue (also known as a bond issue) is a medium/long term loan (more than one year), in which the state, through the government, will obtain the financial resources it needs from institutional investors (companies and other organisations), through the capital market (Stock Exchange), in return for an interest rate and the return of the amount invested by the end of the loan period.


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