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The United Cities and Local Governments of Africa (UCLGA) commissioned this report in coordination with the National Association of Municipalities of Mozambique (ANAMM) to analyse the political economy of decentralisation of Mozambique. The report provides information in support of the ANAMM discussion and dialogue toward the new European Union (EU) programming process of cooperation with local authorities (LAs) for the 2021-2027 period. This report was developed in line with another called “Compendium of References” which is also part of the preparation for the EU programming process of cooperation with the Las. The analytical report on political economy pretends to explore the extent to which the central government embraced the conceptualisation of territorial development, the level of commitment of central government in recognizing the role of local authorities in the territorialisation of the national development agenda, and the opportunities and constraints created by the decentralisation system for the empowerment of local authorities as developmental actors. The political economy analysis catches the key aspects of how political and economic power influences the way how decentralisation is implemented and contested, the incentives behind the political actors and interests groups and how they impact the decentralisation reforms outcomes. The report serves as a background document to a seminar of the members of the ANAMM, which is part of a process of building consensus over the key priority action to include in the municipalities’, or interchangeably called in the report also as local authorities, roadmap for dialogue with the central government and the EU Delegation in Maputo, Mozambique. The expected result involves the following: (i) An analysis of the political economy of decentralisation, the feasibility of the new local authorities (LAs) driven political agenda and the opportunities and constraints created by the decentralisation reforms; (ii) An overview of the state of art regarding the territorialising of national policies and global agendas including SDGs, in terms of both policies and programs adopted in the framework of the national development plan; (iii) A SWOT quick analysis of the ANAMM; and (iv) The state of the art concerning the territorialisation of national policies and global programs, including Sustainable Development Goals (SDGs), both at the level of policies and programs implemented within the framework of the National Development Plan.