IMF Returns to Mozambique: Navigating Debt & Economic Revival

The International Monetary Fund (IMF) is set to send a team to Mozambique in June to further negotiations on a new loan arrangement, a spokesperson has confirmed. The move comes as Mozambique grapples with increasing debt, a contracting economy, and limited public service resources.

During the Spring Meetings, the IMF and Mozambican authorities held productive talks regarding the Middle East conflict's economic impacts and the Fund's future support for the country. Discussions are expected to continue over the coming months.

Mozambique's financial situation is dire, with its economy contracting by approximately 0.5% in 2025, and its debt-to-GDP ratio measured at 91% as of February. An enduring issue is a 2016 hidden-debt scandal, which shattered investor confidence and limited financing. The country also faces delays in significant gas projects that would boost its economy. Central bank loans to the government have surged, and talks on a new IMF agreement focus on necessary economic reforms.