Mozambique - 01

Mozambique: Donors Suspend Aid: Repercussions for Investors

On 27 April the World Bank joined the IMF in suspending financial support to Mozambique, with the UK’s DFID following suit on 28 April. Their decisions were prompted by the IMF’s suspension of its standby credit facility (SCF) on 15 April, citing the previously undisclosed loans that escalated Mozambique’s sovereign debt to unprecedented levels. As of the beginning of May, the total value of known sovereign loans approaches $2.2bn, although this figure could yet rise further. Highlighting the effects of this lack of transparency, on 3 May Fitch downgraded Mozambique from a B to CCC credit rating.

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