Standard Bank expects Mozambique’s foreign exchange shortages to worsen, which might lead to approved payments not clearing and imports being delayed.
Standard Bank’s chief economist at its Mozambique business, Fáusio Mussá, said the country’s foreign exchange outlook was not good.
“Despite prospects of progress on liquefied natural gas projects, which should boost output in the medium-term, we now factor in fiscal and foreign exchange liquidity pressures likely to intensify in the short-term,” Mussá said in the Standard Bank Mozambique purchasing managers index for November.
“The possibility of a shutdown at Mozal at the end of the first quarter of 2026, if the company cannot secure a favourable electricity tariff, implies further temporary growth and fiscal and FX pressure.”
South32 in December said Mozal, Mozambique’s largest aluminium smelter, would be placed on care and maintenance from March this year after it failed to secure affordable and reliable electricity to keep the plant running.
Mozal is one of Mozambique’s most important industrial assets.
Located near Maputo, it produces high-quality aluminium for local use and export and plays a major role in supporting jobs, suppliers and surrounding communities.
Business Day reported last year that South African airline Airlink had grown weary of blocked funds from Mozambique, with the company contemplating terminating ticket issuance in the country, which is said to have blocked about $200m (R3.5bn) in cash to several airlines.
This as Mozambique struggles with foreign currency shortages, which threaten regional movement.
According to data from the International Air Transport Association, Mozambique has climbed to the top of blocked funds countries, withholding $205m (R3.3bn) from airlines at the end of April last year, compared with $127m (R2bn) in October 2024.
Regarding Mozambique’s economy, Mussá said: “Mozambique’s economy had negative GDP growth in the first three quarters of 2025, averaging -1.9% and denoting a slow recovery from post-election fallout.
“We see GDP growth turning positive in the last quarter of 2025, supported by favourable base effects, but with a high risk of turning negative from the second quarter of 2026 if Mozal is shut down.”
— With Jacob Webster
This article was updated to add the missing word ‘good’ in the second paragraph.
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