According to Rogerio Nkomo, a spokesman for Mozambique’s finance ministry, the nation was close to reaching a loan restructuring agreement with Russian bank VTB on a loan made to state-owned firm Mozambique Asset Management (MAM). Previously, MAM had missed a $178m interest payment on VTB Bank’s loan on 23 May 2016.
According to Mr. Nkomo, matters pertaining to restructuring of the loan and payment of interest would be resolved within the coming few days.
The cash-strapped nation’s problems increased after the missed interest payment. A group of donors have requested the government to reveal the shareholding structure of MAM and a second state-owned company, Proindicus, which was lent $622m in 2013.
As a result of the situation, S&P downgraded Mozambique’s sovereign credit rating to CCC from B-, which estimated that Mozambique’s net general debt was 90% of its GDP in 2016. Further, Fitch Ratings also lowered the nation’s rating this month to CC from CCC, saying the nation was at a greater risk of default.