Africa-Press – Mozambique. Mozambique’s sovereign risk was at a “severe level” at the end of the first half of the year due to pressure from public debt, according to a report released by the country’s central bank on Friday, 12 December 2025.
“In June 2025, sovereign risk remained at a severe level. The persistence of sovereign risk at this level stems from pressure on public debt,” reads the Bank of Mozambique’s financial stability bulletin, issued semi-annually.
The document added that the ratio of government credit to total credit “remained at a severe level, at 44.84%, compared to 46.01% in December 2024”.
“On the other hand, the ratio of public debt to GDP [Gross Domestic Product] remained at a high risk level, rising from 71.79% to 73.81% between December 2024 and June 2025,” the document states.
Mozambique’s Prime Minister, Benvinda Levi, said in parliament on 20 November that the government planned to reduce the state’s borrowing requirements by increasing revenues and implementing tax reforms.
“We believe that increased revenue collection will gradually reduce the state’s need to resort to domestic and external borrowing,” said the prime minister on the second day of debate on the 2024 General State Account (CGE) in parliament.
“We will implement economic policy measures and tax reforms to stimulate the growth of our economy through productive diversification, strengthening national value chains, increasing production and productivity, which, on the one hand, will contribute to increasing state revenues and, on the other, generate more jobs and income for Mozambicans,” Levi added.
Benvinda Levi reiterated that solutions were being adopted to “improve the quality of debt data in terms of recording, servicing, monitoring and analysing its management” to achieve “greater fiscal transparency”.
“We will continue to take action to bring public debt to sustainable levels, ensuring a balance between sources of financing and strengthening fiscal discipline,” she insisted.
Mozambique’s debt fell during the third quarter to 1.068 billion meticais (€14.5 billion), according to a report by the Ministry of Finance, Lusa reported.
According to the third-quarter budget execution data, 41.6% of the total debt stock as of 30 September was domestic debt, including advances from the Bank of Mozambique and issues of Treasury Bonds and Treasury Bills, with the remaining 58.4% relating to external debt.
This volume of debt compares with the record high at the end of the second quarter, when Mozambique’s debt stock reached 1.072 trillion meticais (€14.6 billion) on 30 June, according to previous data from the Ministry of Finance, which was then an increase of 0.1% compared to the previous quarter.
This represents a 0.9% decline over three months, according to the government, mainly due to the amortisation of Treasury bonds.
Mozambique’s Finance Minister, Carla Loveira, said on 29 October that the sustainability of public debt is “one of the biggest challenges” facing the Mozambican economy, with “reforms” underway for its sustainable management.
Lusa reported on 27 October that Mozambique’s government had hired the American firm Alvarez & Marçal to “assist in the preparation of the public debt restructuring plan” and to “provide support in the preparation of the 2026-2029 Public Debt Strategy”.
Alvarez & Marsal, headquartered in New York and with a global presence, is described as a specialist in recovery and performance improvement, with interventions such as those at Lehman Brothers.
