How Serious Is Mozambiques Financial Crisis?
Mozambiques international bonds tumbled earlier this week after a news report that the new government in Maputo is weighing a debt restructuring following months of post-election turmoil. Below are some of the issues facing the resource-rich southern African country of 35 million people.
WHAT IS MOZAMBIQUES DEBT SITUATION?
Concerns about government finances have been mounting in recent years due to an Islamist insurgency in northern Mozambique that has delayed plans to develop huge gas fields.
Although Mozambiques public debt-to-GDP, fell to 93.7 in 2023 from 100.3 the previous year, it is classified by the International Monetary Fund IMF as being at high risk of overall debt distress.
Its external debt-to-GDP ratio fell to 66.2 from 72.1 but frequent delays in the development of liquefied natural gas fields mean that it has to wait longer before its external debt service can benefit from those exports.
