The state will try to place another 906 million meticals (13 million euros) in Treasury Bonds next Tuesday, 6 February, the third issue this year, according to information from the Mozambique Stock Exchange (BVM).
According to the Lusa news agency, the issue involved a special stock exchange session to determine the results of the direct subscription by the Specialised Treasury Bond Operators (OEOT) for the first Reopening of Treasury Bonds 2024 – 2nd Series (OT-2024-2S).
“The reopening consists of issuing new quantities of securities to the series of Treasury Bonds (OT) previously issued,” reads the BVM notice.
The document explains that a “maximum amount” of 906 million meticals will be put up for subscription by the OEOTs, at a nominal interest rate fixed at 19.50 per cent during the first four half-yearly interest payments and variable during the last six half-yearly interest payments, with a maturity of five years.
“The presentation of subscription proposals for this reopening will take place on 6 February 2024, from 09:00 to 12:00,” the notice also states.
Lusa reported on 18 January, citing BVM data, that the state had placed the equivalent of 52.6 million euros in the second issue of 2024 Treasury Bonds (OT-2024-2S), with the interest rate rising to 19.5%.
This was the second issue in the space of a week and, according to BVM, which conducted the operation, the bids submitted by the OEOTs represented an overall demand of 4.1 billion meticais (59.8 million euros), “with a demand to supply ratio of 102.8 per cent, with a minimum interest rate of 19.5 per cent and a maximum of 23 per cent, for a maturity of five years”.
According to the cut-off rate defined for the operation, the value of this issue of Treasury Bonds 2024 – 2nd Series, whose interest rate rose to 19.5 per cent compared to the previous ones, was 3.6 billion meticais (52.6 million euros), for an amount initially requested of 4 billion meticals (58.2 million euros).
In the first OT issue of the year, through BVM and carried out on 10 January, the state placed 2 billion meticals (29.5 million euros) with a maturity of five years, for an amount initially required of 2.1 billion meticals (31.5 million euros), paying 18% interest, which was also higher than the previous ones, but with a demand of 123.61%.
The government forecasts a deficit in 2024 equivalent to 2.3 billion euros, or 10.4 per cent of the Gross Domestic Product (GDP), an increase of almost 40 per cent compared to this year, which will be financed with new debt.
According to the documents supporting the Economic and Social Plan and State Budget (PESOE) for 2024, the government expects to collect more than 383.5 billion meticals (5.6 billion euros) in revenue, corresponding to 25 per cent of the estimated GDP and an increase of 7.5 per cent compared to the budget for 2023.
On the state spending side, the budget forecast for next year is more than 542.6 billion meticals (7.9 billion euros), equivalent to 35.3 per cent of GDP and an increase of 15 per cent compared to the budget for 2023.
The budget deficit forecast by the government for this year is more than 159.4 billion meticais (2.3 billion euros), an increase of 38.6 per cent compared to the estimate for 2023, where the figure is more than 115 billion meticals (1.6 billion euros). In 2022, the budget deficit was 142 billion meticais (2 billion euros).
In order to finance the deficit, the government plans to use external donations, totalling more than 83.3 billion meticals (1.2 billion euros), external debt, to the tune of 29.4 billion meticals (432 million euros) and internal credit, in this case to the tune of 46.3 billion meticals (680 million euros).
