Oxford Economics, an international economic consultancy, is preparing to revise Mozambique’s economic growth forecast for 2026 downwards, from 3.8% to 2.5%. The firm, specialised in macroeconomic studies and global risks, attributes this revision to fiscal consolidation and the scheduled decline in gas production, according to a report sent to its clients and cited by Lusa.
According to the consultancy, “growth will be constrained due to fiscal consolidation efforts, which a new International Monetary Fund (IMF) programme will likely reinforce.” Oxford Economics added that maintenance work on the Coral South floating liquefied natural gas (LNG) project is expected to cause a “temporary decline in natural gas and condensate production,” motivating the cut in the forecast for next year.
The British consultancy also revised down its growth estimate for 2025, from 1.8% to 1.4%, influenced by a 1.9% decline in economic activity recorded in the first three quarters. This reduction reflects the prolonged effects of post-election disruptions and the slowdown observed across several sectors.
Despite the challenging economic scenario, Oxford Economics considers that “prospects for the coming year are slightly more favourable.” Improved political stability, greater dynamism in the services sector, and the positive impact of liquefied natural gas (LNG) projects are expected to support part of the economic recovery.
The consultancy also anticipates weaker performance in the fourth quarter of this year due to seasonal factors. “There is a typical agricultural effect during this period, corresponding to the pre-harvest scarcity phase,” it notes, predicting, however, “a significant jump in annual growth” at the end of 2025, driven by base effects related to the post-election protests of 2024.
Recent data from the Bank of Mozambique confirm that economic activity fell by 0.85% in the third quarter, extending a cycle of declines that began in 2024. The institution explained that this contraction results mainly from “the effects of post-election tension,” which affected the secondary and tertiary sectors most intensely, reducing investment and private consumption.
The economy had already been on a negative trajectory, after contractions of 5.68% in the fourth quarter of 2024 and 3.92% and 0.94% in the first and second quarters of 2025. These results highlight the persistent economic impact of the political instability experienced following the 9 October 2024 elections.
The Government also recognises a “substantially more adverse” financial environment than that projected in the 2026 Economic and Social Plan and State Budget (PESOE). Nevertheless, it anticipates a recovery to 2.8% next year, supported by the services sector, increased LNG exports, agricultural dynamism, and new investments in the energy sector.
