Mozambique: Government rainy season contingency plan lists 175 roads at risk
Mozambique’s public debt grew 62.3 percent between 2015 and 2016, surpassing the sustainability limits set by international financial institutions, according to the General State Account (CGE) of 2016, debate on which began yesterday in the Mozambican parliament.
According to the 2016 CGE, public debt in 2016 reached 701,708 million meticais (EUR 9.3 billion) against 432,233 million meticais in 2015 (EUR 5.7 billion).
External debt registered the largest increase, rising 69.1percent to 613.998 million meticais, while domestic debt increased 26.7 percent to 87.710 million meticais.
In total, external debt accounted for 87.5 percent of Mozambique’s public debt in 2016 and domestic debt for the remaining 12.5 percent.
“Domestic debt decreased in relation to the year 2015, while the external debt increased sharply,” the CGE reveals.
The report notes that the country has doubled the external debt ratios in relation to the gross domestic product, exports and current revenues between 2015 and 2016, exceeding the limits established by the World Bank and the International Monetary Fund (IMF) in regard to debt sustainability.
In 2016, the Mozambican state recorded a volume of 226.436 million meticais in debt cancellation (EUR 2.9 billion), debt forgiveness and foreign exchange variation, 136.311 million meticais in disbursements (EUR 1.8 billion) and 122.509 million in amortisations (EUR 1.6 billion).
Other documents presented by the Mozambican government to creditors last month indicate that Mozambique will by July have surpassed all five limits used by the International Monetary Fund to evaluate debt sustainability.
“By the end of 2017, all indicators of Mozambique Debt Sustainability Analysis (except the ratio of debt service to exports) were above prudential thresholds for countries with an average ranking in the Country Policy and Institutional Assessment Index,” one of the pages of the presentation to creditors in London on March 20 reads.
Below, it is stated that “by March 20, 2018, Mozambique had delays in the payments of Mozam2023, MAM and Proindicus [the sovereign debt securities maturing in 2023 and the two previously undisclosed loans contracted by two public companies with state guarantees] amounting to approximately US$ 636 million”, exceeding all five IMF-defined ceilings.
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