Public debt service triples in Q1

Between January and March this year, the Mozambican executive made payments amounting to some 4.7 billion meticais in public debt amortisation, against 1.4 billion meticais in the same period of 2018.

The Mozambican government paid more than three times as much in public debt repayments over the first three months of this year, making payments of around 4.7 billion meticais, according to the National Treasury Directorate (DNT). Of this amount, external debt amortisation (bilateral and multilateral) amounted to 2.9 billion meticais in the first quarter of 2019, against 1.3 billion meticais in the same quarter of the previous year. Domestic debt service, which includes Treasury Bonds, bank financing, restructuring and consolidation of the state’s business sector, amounted to approximately 1.8 billion meticais, against 88 million meticais paid in the first quarter of 2018. The National Treasury Directorate said that, besides the amounts related to Treasury Bonds, bank financing, restructuring and consolidation, an amount of 315.7 million meticais was also disbursed.This amount (315.7 million meticais) had been paid and settled in 2018, referring to the payment of the debts of the previous years with the suppliers of goods and services in the scope of the restructuring and fiscal consolidation.

Meanwhile, in the January to March 2019 period, new debt securities (treasury bills) were issued amounting to 18,039.7 million meticais, with amortisations totalling 18,124.2 million meticais. Concerning treasury bonds, the budget law set the limit of 19,447.31 million meticais for 2019 and, during the first quarter of this year, bonds amounting to 8,974.6 million meticais were issued, according to the National Treasury Department. Of this amount, 3,602.1 million meticais were for the securitisation of the debts to suppliers of goods and services amounting to more than 60 million meticais and 5,372.5 million meticais went to finance the state budget deficit. Throughout this operation, the final stock of domestic debt in the period under analysis amounted to 136,150.7 million meticais, against 139,377.2 million meticais at the end of the first quarter of 2018. As far as external debt is concerned, from January to March of fiscal year 2019, the government contracted two concessional loans, one with the International Development Fund of OPEC (OFID) and one with Eximbank of India, to a total US$50 million dollars. The OFID loan was US$ 12 million US dollars, with a maturity of 22 years and an interest rate of 1%. The money is set aside for the construction of the Angoche fishing port in Nampula. The Eximbank concessional loan of US$38 million, with a maturity of 25 years and a 1.5% interest rate, is intended to finance a water supply project in the rural areas of Manica, Sofala, Zambézia and Nampula. Under article 11 of Law 15/2018 of 20 December, the Mozambican government is authorised to issue guarantees and endorsements amounting to 151,250 million meticais, of which 136,125 million meticais to support state companies in the extractive industry and 15,125 million meticais for remaining state-sector companies, but no state guarantee was issued during the period under review.