The Mozambican debt crisis: How a sovereign state was sold

Mary Serumaga

In 2013 Mozambican government officials formed three private companies and took out illegal secret loans totaling $2 billion. Donors suspended credit to Mozambique because of the loans as the national currency fell by 70% in 2016. Restructuring the illegal loans means imposed austerity on a population already living in extreme austerity and eventually repaying the creditors from revenues derived from Mozambique’s natural gas deposits that on the market in 2023.

It has finally come to pass. An African country has been sold, lock stock and barrel by its leaders to European corporations. Mozambican government officials negotiated a secret loan agreement with Credit Suisse, BNP Paribas and VTB Capital for $2 billion. The loan was executed in the form of government guaranteed bonds bought by the lending banks. The country’s GDP at the time was $16 billion. Ostensibly the loan was for a tuna-fishing project but has now turned out, on the admission of the officials concerned, to be a loan mostly for military equipment.

The guarantee gives British courts “exclusive jurisdiction to resolve any disputes arising out of [ …] this warranty” and Mozambique renounces “any immunity which it or its property or income may enjoy in any jurisdiction.