V3I1P59

The Expansion of Treasury Bills and Its Implications for Parliamentary Oversight in Mozambique

Torres Filipe Charles^1*, Francis Pol C. Lim²

Abstract

This article critically examines the use of Treasury Bills as a financing instrument of the Mozambican State between 2015 and 2025, with particular emphasis on their implications for parliamentary oversight, fiscal transparency, and debt sustainability. Adopting a qualitative and descriptive approach, grounded in documentary, legal, and bibliographic analysis, the study explores the legal and institutional framework governing Treasury Bill issuance, their evolution and relative weight within domestic public debt, and the economic, political, and institutional impacts of their intensive use. The findings reveal a structural shift in domestic debt management, characterized by a significant expansion of Treasury Bills, estimated at approximately 31% over the period under review, with a marked acceleration after 2016 following the hidden debt crisis. Treasury Bills evolved from short-term cash management instruments into a central mechanism of State financing, accounting for nearly one third of domestic public debt by 2025. The analysis further indicates that around 64% of Treasury Bill-related debt issued in recent years was not subject to effective parliamentary scrutiny, undermining fiscal transparency and democratic accountability. The study concludes that, while Treasury Bills provide short-term financial flexibility, their excessive reliance poses substantial risks to fiscal sustainability and weakens democratic governance of public finances, highlighting the need for stronger legal frameworks and enhanced parliamentary oversight.

Keywords:

Treasury Bills; Domestic Public Debt; Parliamentary Oversight; Fiscal Transparency