In recent years, Mozambique has faced significant economic challenges that directly influence development and financial stability. In 2024, the country recorded growth of around 4%, in contrast to government forecasts, which predicted rates of around 5.5%. On the other hand, public debt remains a pressing concern. Although the debt/GDP ratio has fallen slightly to 93.7 per cent in 2023, the country is still classified as being at ‘high risk’ of over-indebtedness by the International Monetary Fund (IMF).
At the same time, Mozambique is taking significant steps towards digital transformation. Huawei Technologies, for example, is conducting tests to implement 5G technology in the country, with the aim of revolutionising connectivity and boosting strategic sectors such as airports, ports and mining. Currently, around 75 per cent of the national territory has access to the mobile network, with the goal of reaching 90 per cent by 2025.
We see the duality of the Mozambican scenario highlighted: while facing significant economic and fiscal challenges, the country is also investing in technological advances that can serve as catalysts for sustainable and inclusive growth in the coming years.
While facing significant economic and fiscal challenges, the country is also investing in technological advances that can serve as catalysts for sustainable and inclusive growth in the coming years.
Technologies for digitalisation
To accelerate this process and bring Mozambique into line with global trends, followed by countries at the forefront of the digital transition, it is essential to adopt a robust technology investment strategy. Digitalisation is not just a matter of innovation, but an essential element for boosting economic growth, improving competitiveness and broadening social inclusion. The priority axes include:
- Broadband and connectivity: the extension of the telecommunications infrastructure, with the expansion of 4G networks and the implementation of 5G, is crucial for transforming various strategic sectors. In the financial sector, improved connectivity facilitates the growth of fintechs and mobile banking services, allowing the population greater access to digital transactions. In health, it enables telemedicine, improving care in remote regions. In education, it expands access to distance learning platforms, reducing geographical barriers and promoting greater professional qualification.
- Cloud computing: the adoption of cloud-based solutions allows companies, governments and start-ups to operate more efficiently and securely, without the need to invest heavily in physical infrastructure. Cloud computing models democratise access to high-performance services, enabling artificial intelligence solutions, big data analysis and the storage of strategic information at reduced costs.
- Cybersecurity: with increasing digitalisation, data protection has become a priority. Developing a solid cybersecurity framework is essential to guarantee digital resilience, protect government and business systems and promote citizens’ trust in the digital environment.
- Digital payments and fintechs: the modernisation of the financial sector is one of the main drivers of digital inclusion. The popularisation of digital wallets, electronic payments and fintech platforms has the potential to reduce dependence on traditional banking services, making it easier for the unbanked population to access financial transactions. In addition, strengthening this ecosystem stimulates e-commerce and innovation in financial products and services. In South Africa, for example, the implementation of 5G networks has strengthened digital financial services, showing a viable path for Mozambique towards the digital transition.
Barriers to the digital transition
Mozambique faces a number of unique challenges to the digital transition, reflecting both structural barriers and economic and social issues:
- Connectivity and digital inclusion: mobile broadband penetration in Mozambique reached just 30 per cent in 2021, significantly below the regional average – for example, in South Africa, the rate exceeds 50 per cent. This is a reflection of a limited telecommunications infrastructure, with high-speed networks concentrated in urban areas. According to the World Bank, approximately 2 million people in rural villages still live without mobile coverage, which perpetuates social disparities and limits access to public services and digital employment opportunities.
- Affordability and digital literacy: although Internet access prices are falling, the cost of 1GB of data still represents 8.7 per cent of the average monthly income in Mozambique, well above the global standard of 2 per cent. The lack of affordable devices is also a barrier: in 2021, an entry-level smartphone cost around 39.8 per cent of monthly income, making it unaffordable for most. This scenario is exacerbated by low digital literacy, especially in rural regions and among marginalised groups.
- Digital governance: communications governance is fragmented, with multiple agencies playing overlapping roles. The GovNet network, which provides connectivity for ministries and departments, suffers from low quality and high costs, forcing the government to look for alternative solutions at a high price. Modernising this infrastructure and consolidating data governance would allow for greater operational efficiency and security.
- Cybersecurity and data protection: with increasing digitalisation, cybersecurity has become critical. In 2023, the government made progress in regulating digital services, but the country still lacks comprehensive legislation for cybercrime and data protection.
- Digital financial inclusion: although the adoption of digital wallets is growing, less than 35 per cent of adults have bank accounts. This limits the potential of services such as e-commerce and online payments.
Basic training is crucial to the success of digitalisation
Solutions and ways forward
- Investing in digital infrastructure: inadequate infrastructure remains a central barrier. Mixed financing models, combining public and private capital, can make it possible to expand connectivity in remote regions. The country can seek partnerships with global initiatives such as Starlink, which has already improved connectivity in rural areas in several countries. In addition, the adoption of open access technologies, such as open RAN (Open Radio Access Network) networks, can reduce deployment and maintenance costs.
- Expanding digital literacy: training is key to ensuring that citizens can fully enjoy the benefits of digitalisation. Educational programmes should be implemented from primary levels, with a focus on vulnerable populations, including women and young people in rural areas. Mozambique can take inspiration from initiatives such as Code Club in Uganda, which teaches digital skills to children in local schools.
- Implement regulatory reforms: clear rules for cybersecurity and data protection are crucial to creating an environment of trust. The experience of countries like Estonia, a pioneer in digital identity, demonstrates that modern, integrated legislation can transform the relationship between government and citizens, making public services more efficient and secure. In Mozambique, a similar strategy, which promotes the interoperability of systems and the protection of personal data, will strengthen digital governance.
- Fostering the innovation and entrepreneurship ecosystem: creating an environment favourable to the development of technological start-ups requires tax incentives and policies to support small and medium-sized enterprises. Partnering with regional business incubators and facilitating access to venture capital can stimulate local innovative solutions.
- Developing solutions for financial inclusion: expanding access to digital financial services should be a priority. Partnerships between traditional banks and fintechs can create more accessible products, such as digital microcredit and electronic savings. In addition, promoting digital financial education campaigns would help increase uptake of these tools.
