Millennium bim chief economist Oldemiro Belchior has said that Mozambique's investment prospects remain challenging in the near term, citing foreign exchange shortages, inflationary pressures, restricted access to financing and fragile public finances. To reverse the trend, he called for deep changes to monetary, exchange rate and fiscal policy.
Speaking on Tuesday (29) at a webinar on 'Business Environment: Investment and Opportunities for Companies', Belchior identified the scarcity of foreign currency as one of the principal obstacles to business activity, particularly for micro, small and medium-sized enterprises (MSMEs). He argued that difficulties in obtaining foreign exchange to import consumer, capital and intermediate goods reduce company profitability and limit capacity for expansion.
To address the problem, he advocated greater exchange rate flexibility, bringing the official rate closer to the market rate. 'The country needs to move towards a floating exchange rate regime so that there is convergence between the official and the parallel exchange rates,' he said, acknowledging that the shift could result in a gradual depreciation of the metical against the dollar.
Belchior cautioned, however, that a depreciation of the metical could raise the cost of imported goods and intensify inflationary pressures. In that scenario, monetary conditions could become more restrictive in 2027, making it harder for businesses to access financing. The fragility of public finances and negative assessments from credit rating agencies were also cited as factors that could weigh on investment decisions.
In this context, Belchior argued that a potential agreement between the government and the International Monetary Fund (IMF) could strengthen the country's credibility and help stabilise public finances. In his view, attracting foreign direct investment requires greater economic and financial stability, underpinned by controlled inflation, accessible interest rates and greater exchange rate flexibility.
Despite the near-term constraints, the economist identified opportunities in large-scale projects, particularly in the liquefied natural gas (LNG), manufacturing, agri-food and energy sectors. He said these investments could increase demand for domestic goods and services and create new value chains, provided that major projects succeed in integrating Mozambican companies into their supply chains.
Such integration could also help narrow the gap between large projects and the majority of domestic companies, in what the economist described as a 'two-speed' economy. In his assessment, the development of local supply chains would allow large-scale investments to generate broader opportunities for Mozambican businesses, with more significant impacts expected in the medium to long term.
For the final quarter of 2026, Belchior does not anticipate any meaningful improvement in the business environment, given the persistence of inflation, foreign exchange shortages and restrictive monetary conditions. Looking further ahead, particularly from 2030 onwards, he foresees a more positive outlook, driven by the advancement of major projects and their associated infrastructure.
Source: Diário Económico
Original article: https://www.diarioeconomico.co.mz/2026/09/29/economia/investimento/oldemiro-belchior-defende-mudancas-profundas-para-melhorar-perspectivas-de-investimento/
