The latest assessment by the credit rating agency Fitch paints a worrying picture of the Mozambican economy in 2025: the suspension of USAID support, decided at the start of the year by Donald Trump’s new US administration, is intensifying the shortage of foreign currency in the country, with direct repercussions for economic performance and the labour market.
According to Fitch, the halting of aid from the United States Agency for International Development – which in 2024 channelled about 586 million dollars (the equivalent of 505 million euros) to Mozambique, mainly in the health and education sectors – has deprived the Mozambican economy of a considerable share of external resources, representing about 3% of Gross Domestic Product (GDP). The agency states that “foreign currency shortages increased in 2025, partly owing to the fall in external disbursements to the Government and the USAID suspension”.
The definitive closure of the USAID mission in Mozambique was confirmed on 1 July, deepening a crisis that was already being felt at the start of the year. The consequences of this withdrawal were not limited to the macroeconomic level. According to figures released in July by the Minister of Labour, Gender and Social Action, Ivete Alane, an estimated 2,500 jobs have been lost as a direct result of the end of funding, mainly in organisations previously supported by the US agency. The minister noted, however, that there is not yet a consolidated official estimate.
Fitch kept Mozambique’s credit rating at CCC – the level immediately before Default – reflecting a scenario of high vulnerability. The agency notes, however, that some domestic measures could ease the pressure on the currency. These include the increase in the minimum mandatory conversion rate of export revenues into meticais, which rose from 30% to 50% in April, and the expectation of a new agreement with the International Monetary Fund (IMF) by the end of the year.
At the same time, the Bank of Mozambique has been taking action to stimulate the foreign exchange market. At a press conference held on 31 July, Governor Rogério Zandamela explained that measures are being implemented to redistribute foreign currency resources more efficiently among the different sectors. “These measures are nothing more than adjusting from here, taking certain resources from here, putting them elsewhere and monitoring better”, he declared.
Zandamela added that the daily limit on foreign currency holdings by commercial banks has been reduced, with the aim of increasing the availability of foreign currency to the public and to businesses. This set of decisions, according to the governor, should help ease the current shortfall in access to foreign currency that affects, among others, the health, aviation, fuel and food sectors – a concern already voiced publicly by the Confederation of Economic Associations of Mozambique (CTA), the country’s largest business organisation.
Fitch, for its part, maintains its forecast that the country’s net international reserves will remain stable at around 3,500 million dollars (3,020 million euros) throughout 2025, although it stresses that “risks persist” in an adverse external environment and with heavy dependence on international aid.
