Mozambique’s public debt grew by 7% between July and September 2024, according to the balance of the Economic and Social Plan and State Budget, released by the Ministry of Economy and Finance (MEF).
This increase brought the state’s total indebtedness to around one billion meticals (16.3 billion dollars), with a significant increase in domestic debt, while external debt fell slightly, as reported in the newspaper O País.
According to the MEF, the increase in domestic debt, which rose 26 percent in the period, was mainly due to the issue of new Treasury bonds, totalling 30.1 billion meticals (469.4 million dollars). The aim of this measure was to strengthen internal financing, while it was decided to reduce recourse to external financing.
As a result, debt contracted outside the country fell slightly by 1%, due to the payment of instalments on previous debts and the absence of new external loans.
The accumulated balance of external public debt reached 648.8 billion meticals (10.1 billion dollars), with multilateral creditors accounting for 54.3 per cent of this figure. Domestic debt, in turn, totalled 396 billion meticals (6.2 billion dollars), driven by the strategy of strengthening domestic financing.
In the context of debt repayment, the MEF reported that Treasury Bills totalling 151 billion meticals (2.4 billion dollars) were issued to cover debt amortisation and replacements worth 112 billion meticals (1.7 billion dollars).
‘The accumulated balance of the external public debt reached 648.8 billion meticals (10.1 billion dollars), with multilateral creditors accounting for 54.3 per cent of this figure’
In addition, the state paid 537.8 million meticals (8.4 million dollars) relating to debts with suppliers of goods and services from previous years.
In order to ensure the import of fuel by the state company PETROMOC, a short-term loan of 3.6 billion meticals (56.3 million dollars) was taken out, to be paid off in the current financial year. This loan was accompanied by a short-term guarantee, with no impact on the 2024 public debt stock.
Active financial operations in the third quarter totalled 2.3 billion meticals (36 million dollars), representing 43.4 percent of the annual budget.
In terms of passive financial operations, the figure reached 51 billion meticals (798 million dollars), which corresponds to 83.9 per cent of the annual budget and real growth of 9.4 per cent compared to the previous year.
The MEF emphasised that the growth in domestic debt was a strategic measure to limit the country’s exposure to exchange rate risks and reduce dependence on external financing.
Meanwhile, the document warns of the importance of maintaining the sustainability of public debt, at a time when the state continues to face significant economic and financial challenges.
