Jul 1, 2024
Mozambique to Pay $220 Million Debt to End ‘Tuna Bond’ Saga
, Bloomberg News
(Bloomberg) -- Mozambique agreed to pay creditors including VTB Capital Plc and Banco Comercial Português S.A. $220 million in a settlement that formed part of the nation’s decade-old tuna bond scandal that ended in default.
The claims from the lenders had grown to $1.4 billion as interest continued to accrue, the Finance Ministry and attorney general said in a joint statement Monday. The deal follows similar ones with a group of creditors including UBS Group AG’s Credit Suisse last year. The settlements have removed $2.3 billion in loans from state accounts, according to the statement.
“Mozambique is now, unconditionally, open to the market,” according to the statement. “Its government is committed to strengthening the governance agenda and structural fiscal reforms.”
The debt formed part of a $2 billion coastal project at the center of a bribery and corruption scandal that’s spawned court cases on three continents and led to the imprisonment of the son of the then Mozambican president.
The deal will help draw a line under potential claims Mozambique faced from lenders that financed the project, which included a tuna-fishing fleet, coastal protection system and shipyards, in 2013 and 2014.
The government is still awaiting judgment in a case where it said Oct. 10 that it sought about $2.4 billion from a company called Privinvest, which supplied the equipment, and its founder. The disputing parties could still reach a settlement, according to the attorney general.
Mozambique’s former Finance Minister Manuel Chang is also waiting for his criminal trial to start in New York in the coming weeks for his alleged role in the scandal. He’s denied wrongdoing. US prosecutors claim Chang personally pocketed $5 million in bribes and facilitated the laundering of $200 million in money funneled to Mozambican officials, bankers and suppliers.
The scandal rocked the economy of Mozambique, one of the world’s poorest countries, just as it was preparing to reap the riches of a massive offshore natural gas discovery.
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