Mozambique seeks World Bank budget support as IMF team visits Maputo

Mozambique is pushing to restore direct budget support from the World Bank as part of a broader macroeconomic ​stabilisation drive, its finance minister said on Tuesday, as the country ‌hosted simultaneous high-level visits from the World Bank and the International Monetary Fund. An IMF staff team led by Mission Chief Pablo Lopez Murphy is in Maputo from June 8 to ​12, the Fund confirmed in a statement to Reuters. “The objective of the ​visit is to take stock of recent economic developments, discuss ⁠the authorities’ plans to address fiscal and debt sustainability, and explore how the ​Fund can best support Mozambique going forward.” The IMF mission overlaps with a visit ​by senior World Bank leadership, who attended a signing ceremony at the Office of the Prime Minister on Tuesday, where five financing agreements worth a combined $450 million were concluded across social ​protection, agriculture, water and sanitation, and education and skills.

The resumption of direct ​budget support, suspended after Mozambique’s hidden debt scandal a decade ago, is at the heart of ‌ongoing ⁠negotiations. Finance Minister Carla Louveira said the World Bank’s Development Policy Operation would be activated once Mozambique meets agreed benchmarks on macroeconomic sustainability, debt sustainability and financial integrity, in coordination with the IMF. “This is a very close coordination we are ​having with the Bank,” ​Louveira told reporters, ⁠adding that the request had been personally raised by the nation’s President Daniel Chapo during a recent ​visit to Washington.

Mozambique has faced a succession of shocks this ​year, including ⁠devastating floods linked to climate change and economic spillover from the Middle East conflict, pressures officials cited as driving the urgency of Monday’s signings. The $450 million in agreements ⁠forms part ​of a broader $10 billion World Bank partnership framework ​for Mozambique, with $6 billion earmarked for the public sector and $4 billion for the private sector.