Bank of Mozambique forecasts “gradual recovery” of economic activity in 2026

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Bank of Mozambique forecasts “gradual recovery” of economic activity in 2026

3:20 CAT | 05 Nov 2025

Photo: Banco de Moçambique

The Bank of Mozambique forecasts a “gradual recovery” of Mozambican economic activity in 2026, driven by “structuring” projects related to natural gas and mining, said Governor Rogério Zandamela on Wednesday.

“Regarding our economic outlook for 2026 and the medium term, we foresee a gradual recovery of economic activity, supported by the implementation of structuring projects in strategic areas and by the improvement of internal production conditions,” said the governor of the central bank.

Speaking at the opening of the 50th advisory council of the Bank of Mozambique, taking place in the city of Pemba, Cabo Delgado, Zandamela added the forecast that the balance of international reserves will remain “at comfortable levels” during 2026.

“Inflation projections point to the maintenance of single-digit levels in the short and medium term. However, relevant challenges persist. Internally, there is the continued worsening of fiscal risk, a challenging business environment, climate shocks, and the need for deep structural reforms,” warned the governor.

Zandamela added that “in the external environment,” it is worth highlighting “the slowdown of global economic activity, the persistence of inflation and high levels of uncertainty.”

The Mozambican economy recorded year-on-year contractions in the last quarter of 2024 (-4.9%), the first quarter of 2025 (-3.9%) and the second quarter (-0.9%), affected by the social unrest following the general elections of 9 October.

The Mozambican Government forecasts economic growth of 3.2% in 2026, according to the budget proposal submitted to parliament, raising the Gross Domestic Product (GDP) to 1.665 trillion meticais (€22.3 billion).

According to the proposed Economic and Social Plan and State Budget (PESOE) for 2026, this economic growth follows 2.9% initially forecast for this year and 2.2% in 2024, in both cases influenced by the consequences of post-electoral unrest after last October, which follow the 5% in 2023.

For this year, the Government forecasts a nominal GDP of 1.544 trillion meticais (€20.7 billion), while in 2024 it was 1.453 trillion meticais (€19.5 billion).

Still in the macroeconomic assumptions of the PESOE for 2026, the Government forecasts an annual inflation rate of 3.7%, against 7% expected for this year, 3.2% in 2024 and 7.1% in 2023, with Net International Reserves covering next year 4.4 months of estimated import needs, compared to 4.7 months this year and five months in 2024.

The budget proposal points to the goal of increasing exports from US$8.231 billion (€7.063 billion) this year to US$8.436 billion (€7.239 billion) in 2026, below the volume of imports, which should grow in the same period from US$9.254 billion (€7.940 billion) to US$9.549 billion (€8.194 billion).

Source: Lusa