Mozambique

Mozambique, a country in Southeast Africa with a coast on the Indian Ocean, is bordered by Tanzania to the north, Malawi and Zambia to the northwest, Zimbabwe to the west, and Swaziland and South Africa to the southwest. Mozambique existed for almost five centuries as a Portuguese colony until independence in 1975. It is divided into ten provinces and one city with provincial status, Maputo, which is the capital. Portuguese is the official language of Mozambique. The currency of Mozambique is the metical (MZN).

Mozambique showed strong economic growth at the start of the previous decade, with real gross domestic product (GDP) growth averaging 7.0% from 2010 to 2015. Rapid growth in the mining sector, along with the exploration and discovery of vast natural gas reserves, contributed towards this strong growth.

The country also saw a rapid increase in foreign direct investment (FDI), including investment in coal and natural gas, along with increased spending on major infrastructure projects. 

Revelations of historical corruption were one of the main drivers of economic slowdown from 2016 onwards, with many donor agencies (including the World Bank) withholding much-needed financial aid from the country. Tropical cyclones have also caused large-scale destruction, particularly in the agricultural sector during 2019. Conflicts and terrorist attacks in the Cabo Delgado province have also continued to negatively affect the economy through various sectors. This includes the agriculture sector through displaced individuals, affecting subsistence farming, as well as the mining and oil and gas sectors through interrupted operations in the region. As a result, real GDP growth averaged only 3.3% from 2016 to 2019. The impact of the COVID-19 pandemic, which started in early 2020, caused many disruptions along the supply and demand chains in the economy as various restrictions were put in place. These further pushed the country’s economic growth downwards, resulting in a contraction of 1.3% during 2020. However, Mozambique’s growing liquefied natural gas (LNG) sector is forecast to help accelerate economic growth to pre-2016 levels over the next few years, with real GDP growth forecast at 7.4% for 2024.

PwC has an extensive network of offices in most countries on the African continent. PwC Mozambique offers a range of tax, legal, audit, advisory, and consulting services. Our professionals support clients with local knowledge and skills and with access to a broad range of other professionals across the PwC global network of firms.