The Bank of Mozambique has classified the country’s sovereign risk at a "severe" level for 2025, citing persistent pressure from rising domestic public debt.
The central bank’s assessment underscores deepening fiscal vulnerabilities in the southern African economy, where debt servicing costs continue to crowd out other public expenditures.
Mozambique’s banking industry reported a sharp contraction in earnings last year, with profits falling by nearly 39% to 15.
The warning arrives against a backdrop of significant stress in the financial sector.
Mozambique’s banking industry reported a sharp contraction in earnings last year, with profits falling by nearly 39% to 15.13 billion meticais (€208 million).
This decline occurred despite broader economic activity, suggesting that credit quality deterioration and liquidity constraints are weighing heavily on lenders.
The central bank’s stance aligns with broader international concerns regarding sovereign liquidity.