Huge Public Debt Threatens Mozambique's Financial System

Mozambique's public debt currently stands at U.S.$12.37 billion, of which about 16% is owed to China, Minister of Economy and Finance, Adriano Maleiane has said. Of the total U.S.$12.37 billion dollars of public debt, U.S.$9.85 billion is foreign debt, and the rest domestic debt, raised through high interest-bearing treasury bonds. U.S.$4.35 billion dollars of the foreign debt is owed to multilateral institutions such as the World Bank and the African Development Bank. However the debt owed by fraudulent security-related companies, Proindicus and Mozambique Asset Management, have been excluded from the public debt. The term "hidden debts" refers to the illicit loans of over U.S.$2 billion obtained by three fraudulent, security-linked companies, Proindicus, Ematum and MAM, from the banks Credit Suisse and VTB of Russia in 2013 and 2014. The banks lent the money on the basis of illegal loan guarantees, issued by the government of the day, under the then President, Armando Guebuza.