Mozambique Sovereign Fund received first €151 million in 2024

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Mozambique Sovereign Fund received first €151 million in 2024

11:41 CAT | 17 Feb 2025

File photo: Banco de Moçambique

In 2024, the Mozambican state invested in the new Sovereign Fund of Mozambique (FSM) a
total of US$158.8 million (151.4 million) in revenue from oil and natural gas exploration.

Data from the economic and social balance of the execution of the State Budget from January to December, from the Ministry of Finance, to which Lusa had access today, indicate that these revenues include US$74.17 million (€70.69 million) from 2022 and 2023, and US$84.72 million (€80.75 million) in 2024.

“They were deposited in the Transitory Account at the Bank of Mozambique, in accordance
with Article 6 of Law No. 1/2024 of January 9th that creates the Sovereign Fund of Mozambique,” the document reads.

The Mozambican government has completed all the instruments necessary to operationalize the FSM, which will be financed with revenue from gas exploration projects, the national director of Development Studies and Policies at the Ministry of Economy and Finance told Lusa last April.

Enilde Sarmento explained at the time that two of the three main instruments that were missing to operationalize the FSM had already been finalized, namely the Management Agreement, signed between the Government AND the governor of the central bank, and the Investment Policy, in addition to the fund’s regulations – which was concluded and approved on March 12th.

Meanwhile, the constitution of two committees was also completed: the Investment Advisory Council, whose seven members are appointed by the government, and the Supervision Committee, with members from civil society and which is the responsibility of parliament.

The Mozambican parliament approved, on December 15, 2023, the creation of the FSM with
revenues from natural gas exploration, which, by the 2040s, should reach US$6,000 million
(€5,720 million) annually.

“Projections indicate that annual gas exports could amount to around US$91.7 billion (€87.4 billion) nominal over the life cycle of the project, in a scenario in which all development initiatives approved to date by the government are in operation. In this scenario, annual revenues for the State will reach a peak in the 2040s of more than US$6,000 million per year,” explained Minister of Economy and Finance Max Tonela at the time.

The Mozambican government defined the transfer of resources associated with the exploration of liquefied natural gas and revenues from the exploration of future projects in the oil and gas sector, setting a proportion of 60% for the State Budget and 40% for the Sovereign Fund account in the first 15 years, rising to 50% each from the 16th year onwards.

The International Monetary Fund has called parliament’s approval of the FSM “an important step” towards ensuring the “transparent and sound management” of natural resources.

Source: Lusa