Mozambique: a strong case for debt cancellation

20/12/2024 - Geen onderdeel van een categorie

Mozambique is struggling with a severe debt crisis, limiting its potential to invest in essential services like health and education. In our new brief, co-authored by N’weti and Wemos, we highlight debt cancellation as a viable solution to free Mozambique from its vicious debt cycle, enabling investments in healthcare, education and sustainable development. The brief is based on the findings from the policy note ‘Navigating the Debt Challenges and Unlocking Paths for Sustainable Growth’, from November 2024.

An overview of Mozambique’s debt crisis

Over the last decade, Mozambique’s debt has risen to over USD 11.3 billion – more than half the country’s GDP. International creditors hold 68% of the country’s debt. This burden, exacerbated by high interest rates, currency fluctuations and poor governance, leaves little room for public spending and hinders the country’s ability to provide critical services, such as healthcare, to its citizens.

Debt cancellation: freeing up resources for healthcare

Debt cancellation presents a viable and urgent solution to Mozambique. By alleviating the fiscal pressure caused by unsustainable debt repayments, the country could redirect these funds toward enhancing social welfare, improving healthcare and education, and fostering economic recovery. Such a shift would empower the country to invest in sectors like agriculture and energy, creating jobs and building resilience. Debt relief would also restore Mozambique’s financial stability, rebuilding trust with international investors and paving the way for sustainable growth.

Debt cancellation would enable Mozambique to redirect resources from debt repayments to essential services, fostering a sustainable and equitable future for its population.
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The brief urges international creditors, multilateral organizations and development partners to act decisively and support debt cancellation in Mozambique. This is not only a step toward financial equity but also a commitment to the broader goals of sustainable development. Prioritizing investments in human capital and infrastructure will enable Mozambique to build a healthier and more equitable future for all its people.

Download the brief now

‘Equitable health financing for a strong health system in Mozambique’

This brief is part of the project ‘Equitable health financing for a strong health system in Mozambique’, carried out by N’weti and Wemos and funded by Sint Antonius Foundation Projects. We also invite you to read our policy brief that calls on global actors and the Mozambican government to collaborate more effectively in increasing the health budget. Read more.

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