Maputo, Aug. 17, 2026 (Lusa) - Mozambique's government plans to reduce the burden of public debt servicing to 6% of GDP by 2029, a scenario in which these costs are expected to amount to €1.69 billion, according to calculations Lusa made on Monday.
According to the Medium-Term Fiscal Scenario (CFMP) 2027–2029, recently approved by the cabinet, public debt servicing costs, including interest and repayments, will account for 5.8% of Gross Domestic Product (GDP) in 2027 and 2028 and 5.9% in 2029, down from the 7.5% estimated for 2025 and 2026.
However, the scenario involves an increase in debt servicing costs in nominal terms, in line with the forecast economic growth, with the government projecting nominal GDP to grow from 1.82 trillion meticais (€24.8 billion) in 2027 to 1.93 trillion meticais (€26.3 billion) in 2028 and 2.10 trillion meticais (€28.6 billion) in 2029.
Under this scenario, debt servicing costs are expected to amount to 105.5 billion meticais (€1.44 billion) in 2027, 112.1 billion meticais (1.53 billion euros) in 2028 and 124.0 billion meticais (1.69 billion euros) in 2029, according to calculations carried out by Lusa.
In the same document, the government projects that the ratio of debt servicing to government revenue will fall from 130.3% in 2025 to 31.1% in 2027, 31.2% in 2028 and 31.7% in 2029, a trend linked to the flattening of the maturity profile and improved financing conditions.
In the CFMP, the government also maintains that public debt is expected to follow a downward trajectory, falling from 72.2% of GDP in 2025 to 70.5% in 2027, 68.8% in 2028 and 67.1% in 2029. According to the document, this trend will be supported by fiscal consolidation, economic growth and the containment of net borrowing.
«Debt servicing constitutes a key constraint on fiscal policy, albeit one that is on a path towards normalisation,» the document states.
The government also forecasts a gradual reduction in the average cost of debt, from 5.0% in 2025 to 4.4% in 2027, 4.3% in 2028 and 4.2% in 2029.
At the same time, the state's financial liabilities, consisting mainly of debt repayments, are expected to rise from 46.9 billion meticais (€639 million) in 2027 to 82.1 billion meticais (€1.12 billion) in 2028 and 101.0 billion meticais (€1.38 billion) in 2029.
Previous government data indicate that Mozambique's public debt servicing costs rose by more than 17% in 2025, to 120.60 billion meticais (€1.64 billion), equivalent to 7.8% of GDP, following a decline in 2024 to 108,827 million meticais (€1.48 billion). In 2023, the cost of Mozambique's public debt exceeded 108.28 billion meticais (€1.48 billion), equivalent to 10% of that year's GDP.
In the 2027–2029 Medium-Term Fiscal Plan (CFMP), the government also states that the debt management strategy for the period involves prioritising concessional external financing, reducing reliance on short-term instruments, and extending the maturities of domestic debt by issuing medium- and long-term Treasury bonds.
Furthermore, the document highlights factors that could strengthen debt sustainability, including stable exchange rates, favourable international financial conditions, contained mandatory expenditure, well-managed contingent liabilities associated with public enterprises, and timely progress in the major liquefied natural gas projects planned for the Rovuma Basin.
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