Mozambique: Oxford Economics lowers 2026 growth forecast to 0.3%

Oxford Economics forecasts that Mozambique’s economy, despite robust growth in the final quarter of 2025, will record near-zero growth of 0.3% this year, revising down its previous projection of 2.5% expansion. “Unfortunately, we foresee Mozambique’s economy facing another difficult year in 2026,” analysts wrote on Monday in a commentary on the Gross Domestic Product (GDP) figures for the final quarter of 2025, which showed an expansion of 4.67% compared with the same period in 2024. In the note sent to clients and seen by Lusa, the analysts state that “preliminary projections show that real GDP growth is expected to be a mere 0.3% this year, below the previous forecast of 2.5%” made by Oxford Economics.

The Africa department of the British consultancy cites as key factors behind the downward revision of the country’s 2026 GDP forecast the recent floods, “which destroyed large areas of crops and infrastructure”, the announced closure of the Mozal aluminium smelter, and the temporary halt for scheduled maintenance of Eni’s Coral Sul floating LNG platform. As a result, Mozambique’s economic growth is expected to be constrained by “reduced exports, employment, production and consumer spending”, according to Oxford Economics. In the final quarter of 2025, the Mozambican economy managed to reverse four consecutive quarters of contraction, growing by 4.67%.

However, this was not enough to prevent an overall recession of 0.52% for the year, according to the National Statistics Institute (INE). The 2025 figures were heavily influenced by the violent protests that followed the general elections of 9 October 2024, which over more than five months resulted in 400 deaths and the destruction of businesses and public infrastructure, pushing the economy into decline. Thus, in the third quarter of 2025, according to INE, GDP fell by 0.85% compared with the same period in 2024.

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Declines were also recorded in the first and second quarters of 2025 — 3.92% and 0.94%, respectively, compared with the same periods in 2024 — as well as in the fourth quarter of 2024, when GDP contracted by 5.68%. The previous period of economic growth had been recorded before the 9 October 2024 elections, which were followed by significant social unrest. Growth in the third quarter of 2024 was 5.58%.

For 2025, the government had forecast economic growth of 2.9%, already revised downward, following 1.9% growth in 2024. However, according to Oxford Economics, this projection now appears overly optimistic. “According to the latest IMF report on debt sustainability, the country is already in ‘debt distress’, and its policies are unsustainable,” the analysts write.

It is also likely, they add, that an agreement on a new IMF programme in the second quarter of this year will include “painful fiscal consolidation, domestic debt restructuring and a currency devaluation at an early stage of the programme”. These measures “will weigh on economic growth in the short term”, the Oxford Economics analysts conclude, explaining the sharp downward revision of Mozambique’s growth forecast from 2.5% to 0.3% this year.

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