As the Southern African country struggles with tight public finances and recent IMF warnings about deteriorating debt dynamics, the World Bank announced on Monday that it intends to give Mozambique $6 billion in mostly concessional financing over the next five years to support public investment projects.”We hope to mobilize an additional $3 billion on top of our approximately $3 billion balance sheet on the bank side,” stated Fily Sissoko, director of the World Bank’s Mozambican division.
The funding, which is “very concessional” and mostly in the form of grants, is intended to help the government with its development plan.
An additional $4 billion in private sector funding is also being targeted.
Economic recovery focus
Mozambique’s Finance Minister Carla Louveira said the partnership framework aims “to ensure macro-fiscal consolidation, with a view to sustaining economic recovery.”
While optimism surrounds the resumption of TotalEnergies’ major LNG project, the IMF has highlighted challenges including debt-service delays and persistent fiscal deficits.
The country also faces recurring climate shocks, with cyclones and floods exacerbated by climate change.
