Fitch Ratings has affirmed Mozambique's Long-Term Foreign-Currency Issuer Default Rating (IDR) at 'CCC'. The 'CCC' rating reflects limited financing options combined with high fiscal and external financing needs that have been exacerbated by the coronavirus shock, high general government (GG) debt and ongoing unresolved public-sector debt liabilities, Fitch Ratings reported. Fitch expects real GDP to contract by 1% in 2020, after muted GDP growth in 2019 of 2.2% due to the damage caused by two cyclones.
Mozambique's Attorney General's Office said on Wednesday it will seek the extradition of three former Credit Suisse bankers implicated in a $2 billion debt scandal that sent the country's economy into crisis, Reuters reported. Andrew Pearse, Detelina Subeva and Surjan Singh, who helped arrange the loans to Mozambique, all pleaded guilty in the United States last year to charges including conspiracy to violate U.S. anti-bribery laws and to commit money laundering and securities fraud in relation to their role in the affair.
Switzerland has opened a probe related to $2 billion of loans to Mozambique that were organized by banks including Credit Suisse Group AG and VTB Bank PJSC, in a scandal that has already attracted the attention of prosecutors in the U.S, Bloomberg News reported. The criminal probe started in February against “persons unknown” on suspicion of money laundering in connection with the credit, the Office of the Attorney General said on Friday. The target of the proceedings is not any specific person or entity, the office said.
Mozambique on Monday withdrew appeals against a South African court decision not to extradite its former finance minister, Manuel Chang, wanted in relation to a $2 billion debt scandal that plunged his country’s economy into crisis, Reuters reported. Chang, who denies wrongdoing, was arrested in South Africa in December at the request of the United States while Mozambique also requested his extradition, sparking a legal battle over where he should be sent.
Credit Suisse has hit back against Mozambique in a case in Britain’s High Court, arguing a government guarantee for a $622 million loan - part of a $2 billion debt scandal - is valid and that it is entitled to claim damages, Reuters reported. Mozambique sued the investment bank last year, alongside a number of other defendants, in a bid to cancel the guarantee and seek compensation for losses related to the debt saga, which tipped its economy into crisis. Credit Suisse rejected Mozambique’s arguments in its defense papers and submitted a counter claim, dated Jan.
Russia’s VTB Capital has sued Mozambique to recover its share of defaulted debts at the heart of the impoverished African nation’s $2bn “tuna bond” scandal, the Financial Times reported. State-owned VTB is demanding repayment of a $535m loan, according to a lawsuit that it filed against the Mozambican government in London. In 2013 and 2014 Mozambique borrowed $1.4bn from VTB and Credit Suisse tied to maritime security projects, alongside a $850m bond it sold to investors for the financing of a tuna-fishing fleet.
Russian state lender VTB has filed a lawsuit in Britain’s High Court against a Mozambican government company it lent hefty sums to as part of a project now at the center of a $2 billion debt scandal, according to an online court filing, Reuters reported. The filing, dated Dec. 23, names as defendants the Mozambique state and Mozambique Asset Management, which took a $535 million loan from VTB as part of a costly project that U.S. authorities say was an elaborate front for a bribery and kickback scheme.