Mozambique will only begin negotiations with creditors for debt restructuring after reaching an agreement on a new program with the International Monetary Fund (IMF), stated President Daniel Chapo, emphasizing the need to restore external confidence.
The Head of State explained that the country, rich in natural gas, is negotiating with the IMF for new financing aimed at stabilizing the economy, reducing dependence on natural resources, and strengthening the confidence of international investors.
In an interview with Bloomberg Television, Daniel Chapo indicated that a possible agreement could be reached after a regular IMF mission scheduled for March this year, considering this step essential before any dialogue with creditors.
“What we want at this moment is to finalize the agreement with the IMF and then move on to the aspect you are mentioning, namely debt renegotiation with international partners,” said Daniel Chapo. “We want to establish trust first.”
When asked about the possibility of changes to the terms of the $900 million bond maturing in 2031, the President replied, “Not at this moment. We will consider all of that after closing this package, which I call a package to stimulate the country’s macroeconomic situation.”
Currently, this bond is traded with a yield of around 14%, indicating that some investors consider the possibility of a restructuring of Mozambican debt.
“What we want at this moment is to finalize the agreement with the IMF and then move on to […] debt renegotiation with international partners.” – Daniel Chapo
Mozambique’s last program with the IMF effectively ended at the beginning of 2025, after the government opted not to continue with the remaining evaluations under the three-year Extended Credit Facility agreement.
China holds around 14% of Mozambique’s external public debt, which totaled approximately $9.8 billion at the end of 2024, according to official data.
Mozambique’s economy grew by 1.1% last year, according to the World Bank, a figure that may be optimistic given that production declined in the first three quarters of 2025.
The World Bank forecasts 2.8% growth in 2026, in a context where the government faces financing challenges considered “acute” by the IMF, which has advocated fiscal consolidation, greater exchange rate flexibility, and containment of public sector wages.
Source: Bloomberg
