Africa-Press – Mozambique. In March, more than 14% of Mozambique’s external debt was held by China, the country’s largest bilateral creditor, with a stock of US$1.383 billion (€1.218 billion), according to Mozambican government data.
According to data from the report on the evolution of public debt in the first quarter, compiled by Lusa, the volume of Mozambique’s debt to China fell by 4.3%, to a weight of 14.1% of the total, followed by Japan, also among bilateral creditors, with US$406.88 million (€358.5 million), a weight of 4.1% and 0.5% less than in December.
Portugal comes in third place, with a weight of 3.9% of the total Mozambican external debt, a reduction of 5.2% in three months, to a total of US$380.69 million (€335.5 million).
Overall, Mozambican external debt fell by 1.2% in three months, to a cumulative total of US$9,839 million (€8,670 million), with 55.7% owed by multilateral creditors, led by the International Development Agency (IDA) of the World Bank Group, with US$2,940 million (€2,590 million), 29.9% of the total and down 0.4% since December, followed by the International Monetary Fund (IMF), with 10.1% of the total, US$995.46 million (€877.2 million) and down 1.1% compared to the end of 2024.
Mozambique failed to make servicing payments on its external debt of €47.3 million in 2024, more than half of which was owed to Portugal, citing difficulties due to post-election unrest, according to a government report on public debt reported in early May by Lusa, which warns of additional pressure this year.
The document states that, at the end of last year, “the State’s arrears were exclusively related to external debt”, stressing that “no delays were found in the payment of the internal debt service”, totalling 3.4 billion meticais (€47.3 million), distributed between 2.95 billion meticais (€40.5 million) in principal and 492.28 million meticais (€6.8 million) in interest, “values carried over to 2025”.
“Among the main creditors, Portugal was the largest bilateral creditor, with a total of 1,818.76 million meticais [€25.3 million] in arrears,” the document reads.
It adds that multilateral institutions “were also among the most significant creditors”, such as the IMF, with 718.75 million meticais (€10 million).
The report also explains that “the delay observed was mainly due to the limitation in revenue collection, conditioned by the climate of post-election instability”, which lasted for five months after the Mozambican general elections of October 9, which were strongly contested by the opposition.
“In addition, the PESOE [Economic and Social Plan and State Budget] did not fully foresee the amounts needed to cover debt servicing in 2024, with a total of 115,097.89 million meticais [€1.602 billion] having been budgeted, compared to a forecast of 123,433.58 million meticais [€1.718 billion], which resulted in a deficit of 8,335.69 million meticais [€116 billion], leading to the transfer of charges to the following year”, the document also reads.
Additionally, the report admits, “there were distortions in the projections caused by the limitations of the old CS-DRMS debt management system”, “leading to deviations from the ceiling approved for 2024 and resulting in the incidence of interest on arrears”.
“The transfer of these amounts to 2025 implies additional pressure on the State treasury, given the increase in financial commitments that must be honoured in the next budget year [2025]. This challenging scenario highlights the urgent need to implement effective measures to mitigate the risks associated with debt service and optimize financial flows in the State.”
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