The evolution of Mozambique’s financial situation in the coming years will continue to be heavily dependent on internal political stability and the contours of the financial assistance program being negotiated with the International Monetary Fund (IMF), British consultancy BMI said on Thursday, January 29.
“In Mozambique, we forecast modest growth in 2026, with the government continuing fiscal consolidation, public debt remaining high at around 86% of gross domestic product, and despite some fiscal improvement, the financial outlook remains vulnerable to political instability and the contours of the IMF program,” said analyst Mike Kruiniger.
In response to Lusa, during an online seminar dedicated to the economies of Sub-Saharan Africa, the expert stressed that the Mozambican economy is showing signs of recovery but remains below the targets set by the Executive. “Revenue is recovering with stabilization and the economy is normalizing, but macroeconomic data remain below the government’s targets,” he said.
BMI points out that Mozambique maintains a high public debt-to-GDP ratio, estimated at 86%, in a context of high interest rates and reduced fiscal space, factors that limit the room for maneuver in economic policy.
The consultancy firm forecasts that the national economy will grow by 2.3% in 2026, below the 2.8% projected by the government, after an estimated contraction of around 0.2% last year, as a result of the political instability that followed the presidential elections at the end of 2024 and plunged the country into a wave of violence with hundreds of fatalities.
In its latest report on Mozambique, consulted by Lusa, BMI admits that the floods recorded in recent weeks could put downward pressure on economic projections, especially if the situation worsens in February and March. Even so, it considers that “the floods will only partially offset the recovery in domestic demand.”
According to provisional data from the National Institute for Disaster Management and Risk Reduction (INGD), the death toll from the floods has risen to 22, with around 700,000 people affected in various regions of the country.
The consultancy firm stresses, however, that investments in the natural gas sector should be the main driver of Mozambique’s economic recovery, at a time when the relaunch of TotalEnergies’ activities in Cabo Delgado has been announced, the mega-project for natural gas exploration that could structurally transform the national economy.
At the regional level, BMI forecasts that Sub-Saharan African economies will grow by an average of 4.3% in 2026, the highest rate in the last decade, supported by a recovery in domestic demand, lower inflation, greater exchange rate stability, falling interest rates, and improved access to credit for businesses and households.
