Mozambique: Large investments show the country regaining credibility – IFC

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Mozambique: Large investments show the country regaining credibility – IFC

9:06 CAT | 15 Dec 2021

File photo: IFC

The vice president of the International Finance Corporation for Africa and the Middle East argues that the large investments in Mozambique recently announced show that the country is regaining credibility with the international community after the so-called ‘hidden debts’ scandal.

In an interview with Lusa via videoconference from Washington, Sérgio Pimenta admitted that the 2016 hidden debts scandal “had its impact in terms of the relationship with the international community, including with the International Monetary Fund”.

“It is evident that an issue like this has its impact on the view that investors, not only foreigners, but even Mozambicans, have on investing” in the country, he said.

However, he recalled that following the scandal, the Mozambican government took measures “which were necessary to allow the re-establishment of the credibility of investment in Mozambique”, after international partners suspended budget financing and the financial rating agencies placed the country in default, following the financial default on debt securities.

“When we now see new investments going to be made, I think we can be optimistic that there really is greater credibility” around investment in Mozambique, Pimenta said.

As an example, he cited the US$494 million (€423.85 million) investment that the International Finance Corporation (IFC), a member of the World Bank, announced in October for the Temane power plant, the largest to be built in Mozambique since independence.

“The fact that we were able to mobilise significant funds for the Temane project is a good example that Mozambique’s credibility in the international community really is returning,” he said.

Source: Lusa