Mozambique: Foreign Direct Investment climbs 2% in 2023 to $2.509B

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Mozambique: Foreign Direct Investment climbs 2% in 2023 to $2.509B

5:55 CAT | 26 Mar 2024

in file CoM

Foreign Direct Investment (FDI) in Mozambique grew by 2% in 2023 compared to the previous year, to just over $2.509 billion (€2.313 billion), according to central bank data compiled by Lusa on Monday.

This performance compares with $2.458 billion (€2.266 billion) in 2022. However, it is still far from the peak recorded in 2021, with investments in the area of natural gas production, which caused FDI in Mozambique to soar that year to almost $5.102 billion (€4.704 billion).

In 2023, the “major projects” category secured $2.087 billion (€1.924 billion) in FDI in the form of capital.

Even so, FDI performance in 2023 was above the government’s projection of $1.425 billion (€1.314 billion).

The Mozambican government estimates that FDI in the country should double in 2024, driven by the natural gas exploration business.

In the documents supporting the Economic and Social Plan of the State Budget (PESOE) for 2024, the government points to an increase in FDI to $4.778 billion (€4.405 billion).

“With regard to FDI for 2024, an improvement is expected, mainly influenced by the resumption of TotalEnergies’ investments in the Rovuma Basin,” the report said.

In the PESOE report for 2024, the government estimates a “notable increase in imports of specialised services by the major projects” underway in the country, as well as the “resumption of operations by TotalEnergies”, the French multinational’s project in Cabo Delgado, valued at more than $20 billion (€18.440 billion) and suspended since the start of the terrorist attacks in that northern province.

It also expects the expansion of “production plants for other projects, such as Montepuez Ruby Minning, HCB [Cahora Bassa Hydroelectric Plant] and Coral North FLNG”, which could require “a considerable increase in imports of goods and services, which could exceed the expected increase in exports with the start of natural gas exploration.

The Mozambican government expects the country’s Gross Domestic Product (GDP) to grow by 5.5% in 2024, to 1.536 trillion meticais (more than €22.18 billion).

Source: Lusa