Mozambique’s economic growth outlook has worsened following the latest Spring Meetings, while the country’s public debt is expected to once again surpass 100% of GDP.
The Spring Meetings of the World Bank and International Monetary Fund (IMF) are held annually, serving not only as a platform for discussion but also for updating global and sub-regional macroeconomic forecasts. The data, published at the end of April, project Sub-Saharan Africa’s growth at 3.5% in 2025, compared to 3.3% in 2024. Growth in 2025 is expected to be driven by private consumption and investment. At the same time, inflation is expected to decline across most countries. In the years to follow, economic acceleration in the region is projected to reach 4.3% between 2026 and 2027.
For Mozambique, however, the outlook is more pessimistic: the 2025 growth forecast has been revised down from 4.3% in October 2024 to just 2.5%, following the post-electoral unrest at the end of last year. Additionally, the country’s public debt is expected to again exceed 100% of GDP this year, reaching 101.1%, rising to 104.2% in 2026 and 104.7% in 2027. It is expected to fall below 100% only in 2029, when the ratio is projected to drop to 95.6%, approximately the same as last year’s 96.6% of GDP. In comparison, the IMF forecasts the average public debt-to-GDP ratio for Sub-Saharan Africa to be 55.4% in 2025 and 53.3% in 2026, down from 56.1% in 2024.
“Resilience Amid Uncertainty”
“Economic growth in Sub-Saharan Africa is showing some resilience despite global economic uncertainty and tight fiscal space,” wrote World Bank economists, expressing confidence in a continued decline in inflation (and exchange rate stabilization), with the inflation rate falling from 7.1% in 2023 to 4.5% in 2024. However, “growth remains insufficient to significantly reduce poverty and meet people’s aspirations,” the World Bank’s biannual Africa report warns. Its 31st edition is titled “Improving Governance and Service Delivery in Africa.”
“There is a growing gap between people’s aspirations for good jobs and functioning public services, and markets and institutions that often fail to deliver effectively,” said Andrew Dabalen, the World Bank’s Chief Economist for Africa. He argued that “urgent reforms, supported by greater competition, transparency, and accountability, will be crucial to attract private investment, boost public revenues, and create more economic opportunities for the millions of Africans entering the labor market each year.” A well-known prescription.
With “heightened uncertainty due to shifting trade dynamics, regional conflicts, and climate change affecting people and crops,” African countries should seize this opportunity to “liberalize and diversify their markets” in order to expand economic activity and ensure employment for their growing youth population, the World Bank further recommends.
Text: Newsroom • Photo: D.R.
