The World Bank plans to provide Mozambique with US$6 billion in mostly concessional financing over the next five years, its director for the country said Monday, amid concerns over the Southern African nation’s rising debt burden.
“We have a balance sheet of around US$3 billion on the bank side, and we’re hoping to mobilise another US$3 billion. So that’s a total of US$6 billion on the bank side, which is very concessional,” Fily Sissoko, World Bank division director for Mozambique, Madagascar, Mauritius, Seychelles, and Comoros, told reporters in Maputo.
The funding package is expected to support development projects across infrastructure, health, education, and economic recovery initiatives. Concessional financing typically comes with lower interest rates and longer repayment terms, offering relief to countries facing fiscal pressures.
Mozambique, a country of 33 million people, has in recent years pursued ambitious economic development projects, including energy, mining, and transport infrastructure. However, international financial institutions have expressed concern over its growing public debt.
Last week, the International Monetary Fund (IMF) warned that Mozambique faces worsening debt dynamics, noting that rising borrowing costs and external shocks could strain public finances. Analysts have highlighted that effective allocation of concessional finance will be crucial to prevent fiscal stress while sustaining development gains.
More Read
Sissoko emphasized that the World Bank’s approach combines direct financing with efforts to mobilize additional resources from multilateral and bilateral partners. “Our aim is not just to lend, but to catalyze additional investment that can have a transformative impact on Mozambique’s economy,” he said.
The five-year financing plan aligns with Mozambique’s National Development Strategy, which targets economic diversification, infrastructure expansion, and improved public services. Officials hope that new funding will accelerate post-pandemic recovery, strengthen climate resilience, and create jobs in urban and rural areas.
Observers say that while concessional financing provides vital support, careful monitoring of debt sustainability and project outcomes will be essential to ensure that new borrowing does not exacerbate fiscal vulnerabilities.
More Read
Mozambique has received significant international assistance in recent years, including from the World Bank, IMF, African Development Bank, and bilateral donors. Past investments have focused on transport corridors, hydroelectric projects, and social safety nets, contributing to steady economic growth despite external shocks.
The announcement comes amid global discussions on how developing countries in Africa can access concessional finance to meet both development and climate goals while managing debt pressures. Experts note that Mozambique’s strategy of leveraging concessional lending, combined with private investment, could serve as a model for other countries facing similar challenges.
World Bank officials stressed that the US$6 billion package is part of a broader effort to support sustainable and inclusive growth in the Southern African region. “We are committed to working closely with the government, civil society, and other partners to ensure that funds reach the projects that will most effectively improve livelihoods,” Sissoko said.
Mozambique’s government welcomed the announcement, calling it “a strong vote of confidence in the country’s development trajectory and economic management,” according to a statement from the Ministry of Economy and Finance.
