Mozambique: Nearly 94% of Govt spending in 2026 will be on operating expenses

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Mozambique: Nearly 94% of Govt spending in 2026 will be on operating expenses

1:21 CAT | 11 Aug 2025

File photo: Notícias

The Mozambican government estimates that 93.9% of all government spending in 2026 will be on operating expenses, ranging from salaries to debt obligations, with only 6.1% earmarked for domestic investment, according to official projections consulted by Lusa.

For personnel expenditures alone, the government estimates nearly 214.253 billion meticais (€2.878 billion) for next year, representing 47.3% of total spending. “It will remain the main item of current expenditure, reflecting the impact of the consolidation of the wage reform,” reads the 2026-2028 Medium-Term Fiscal Scenario (CFMP), already approved by the Council of Ministers.

The acquisition of goods and services in 2026 is budgeted at 28,965 million meticais (€389 million), “reflecting measures to contain and rationalize administrative expenses,” and interest charges on public debt will total 67,616 million meticais next year, of which 56,472 million meticais (€758.7 million) will be related to domestic debt.

“The reduction in the external component reflects an effort to rebalance the debt profile,” the report states. It also notes that an amount of nearly 62,794 million meticais (€843.6 million) is projected for financial operations in 2026, including debt amortization.

Current government transfers in 2026 are expected to total nearly 46,965 million meticais (€631 million), with transfers to families standing out, totalling 34,912 million meticais (€469 million), “essentially through pensions and social protection programs.”

Internal investment expenditures are projected at 27,778 million meticais (€373.2 million), representing 6.1% of total expenditure in 2026, “reinforcing the focus on investments with high economic and social impact”.

The document notes that the projected expenditure profile for 2026 “seeks to ensure the continuity of essential public services, fulfil the state’s financial commitments, and promote the gradual resumption of public investment”.

“Measures to contain current expenditure, combined with prioritizing investments and improving the quality of expenditure, are key to ensure budgetary sustainability and the creation of fiscal space in the medium term. Fiscal consolidation thus continues gradually and realistically, preserving the State’s capacity to finance public policies aimed at social inclusion, economic growth, and institutional resilience,” it further argues.

Source: Lusa