Maputo, Aug. 22, 2025 (Lusa) - The net financing of Mozambican state expenditure with short maturity Treasury Bills totalled 17.7 billion meticais (€238.1 million) up to June, bringing the total indebtedness to €14.4 billion.
According to budget execution data from January to June, released today by the Ministry of Finance, Treasury Bills (BT) totalling almost 134.064 billion meticais (€1.801 billion) were issued in this period, towards the "maximum limit" of 335 billion meticais (€4.502 billion) set for issuing this type of debt for the whole year.
"Replacements totalling 114,852.3 million meticais [€1,543 million] were made, resulting in net financing of expenses totalling 17,719.5 million meticais [€238 million]," the document states, adding that six operations were carried out over the first six months of 2025.
"The growth in domestic debt is justified by the poor performance of revenue and the lack of disbursements of external resources (donations and credits), forcing the government to resort to issuing Treasury Bills and other short-term loans to finance the Treasury deficit to ensure the execution of the PESOE [Budget]," the document also states.
Overall, including operations with Treasury Bonds - with longer maturities and no new issues in the first half of the year - according to the same document, the public debt stock on 30 June totalled 1.072 trillion meticais (€14.4 billion), compared to 1.043 trillion meticais (€14 billion) on 31 December 2024.
Of this total, 58.5%, equivalent to 627.855 billion meticais (€8.437 billion), corresponds to external debt, which fell 1.3% in six months, and the remaining 41.5%, totalling almost 444.995 billion meticais (€5.980 billion), to internally issued debt.
The Bank of Mozambique warned on 1 August that the pressure on the country"s domestic public debt “continues to worsen”, having grown by the equivalent of €530 million since the beginning of the year.
"Domestic debt, excluding loan and lease contracts and outstanding liabilities, stands at 454.3 billion meticais [€6,105 million], which represents an increase of 38.7 billion [€520 million] compared to December 2024," reads the communiqué from the Monetary Policy Committee (CPMO) meeting held at the end of July, with data up to that point.
"We can only give what we observe of how the debt behaves. The state has a debt that is growing, [and has] a lot to do with the difficulty of being able to afford the state budget, for various reasons. Now, what is the strategy for this? How can this be resolved? You have to ask the other party," said the central bank governor, when questioned by journalists following this assessment.
"Who issues the public debt securities? It's not us. Who designs the debt strategy? It's not us," Zandamela said.
Lusa previously reported that the refinancing of Mozambican short-term domestic debt issues cost 19,211 million meticais (€258 million) in the first three months of the year. Still, the Finance Ministry doubts the effectiveness of the measure.
"Although this is a liability management operation, to mitigate refinancing risks and improving debt service predictability, its effects have been adverse due to refinancing at more onerous terms and conditions, contributing to an increase in the debt stock and raising concerns about the effectiveness of the strategy adopted and its sustainability in the medium term," reads the Ministry of Finance"s report on public debt from May.
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