The International Monetary Fund (IMF) has noted a gradual economic recovery in Mozambique following a contraction in 2025, but acknowledges significant economic challenges remain. An IMF mission to Maputo from June 8-12 assessed the situation, meeting with government officials, central bank representatives, and private sector stakeholders. While economic activity is improving, growth remains moderate and recent inflation increases are a concern, despite starting from low levels. The IMF reports fiscal imbalances decreased in 2025, but vulnerabilities related to debt and foreign exchange shortages persist, exacerbated by declining exports and increased import costs linked to large investment projects. Global factors, including the war in the Middle East and recent climate shocks, pose additional risks to Mozambique’s growth and could further fuel inflation. The IMF and Mozambican authorities are now discussing measures to restore macroeconomic stability and are considering a potential agreement.