[{"data":1,"prerenderedAt":-1},["ShallowReactive",2],{"doc-detail-111591-en":3,"doc-seo-111591-105":29,"detail-sidebar-cat-0-en-105":91},{"code":4,"msg":5,"data":6},0,"success",{"doc_id":7,"user_id":8,"nickname":9,"user_avatar":10,"doc_module":4,"category_id":11,"category_name":12,"doc_title":13,"doc_description":14,"doc_content":15,"file_id":16,"file_url":17,"file_type":18,"file_size":19,"view_count":20,"is_deleted":4,"is_public":20,"is_downloadable":20,"audit_status":20,"page_count":21,"language":22,"language_code":23,"site_id":24,"html_lang":23,"table_of_contents":25,"faqs":26,"seo_title":13,"seo_description":14,"update_tm":27,"read_time":28},111591,687197207639,"Asher","https://ap-avatar.wpscdn.com/davatar_a8503ba1806abce46bf441b54a3ca4cd",8,"Research & Report","Republic of Mozambique - Joint Bank-Fund Debt Sustainability Analysis - High-risk of distress assessment","Republic of Mozambique: Joint Bank-Fund Debt Sustainability Analysis assesses the country’s risk of external debt distress and overall public debt distress as high. The assessment remains aligned with the January 2024 update and July 2023 full analysis, with several baseline indicators above sustainability thresholds and vulnerability to downside risks. Key drivers include exposure to natural disasters, regional security risks, geo-economic fragmentation, and election-related fiscal pressures. The analysis also notes state participation in large LNG projects, with future borrowing expected to be repaid from LNG revenues, while growth assumptions remain conservative.","Public Disclosure  \nPub lic Disc losure Authorized  \nApproved by:  \nManuela Francisco and Hassan Zaman (IDA) and Andrea Richter Hume and Jay Peiris (IMF) .  \nPrepared by the staff of the International Development Association (IDA) and the International Monetary Fund (IMF) .  \n\n| REPUBLIC OF MOZAMBIQUE: JOINT BANK-FUND DEBT SUSTAINABILITY ANALYSIS |  |\n| --- | --- |\n| Risk of external debt distress | High |\n| Overall risk of debt distress | High |\n| Granularity in the risk rating | Sustainable |\n| Application of judgment | No |\n\nThe debt sustainability assessment remains unchanged compared to the January 2024 DSA update and the July 2023 full DSA. The overall and external public debt are assessed at high risk of distress due to some indicators remaining above sustainability thresholds for several years under the baseline, and the vulnerability of debt to downside risks during this period.1 Public debt is assessed as sustainable in a forward-looking sense because a large share of projected future borrowing reflects the state’s participation in large LNG projects, which will be repaid directly from future LNG revenues (which are expected to be significant) . Risks are tilted to the downside, reflecting vulnerability to natural disasters, risks of intensification of terrorist activity in the North, deepening geo-economic fragmentation, and fiscal pressures related to general elections in October 2024. On the upside, growth assumptions underlying the DSAare conservative, as they do not incorporate potential spillovers from LNG projects to the broader economy. In addition, external debt is mostly concessional, and debt contracted for LNG development will be entirely repaid from LNG revenue, once production starts. This DSA incorporates in the baseline the fiscal and debt implications of an out-ofcourt settlement of litigation related to the remaining part of Mozambique’s 2013-16 disputed debt, which was concluded  \n1 Similar to the January 2024 DSA update , Mozambique’s debt carrying capacity is assessed as “weak” based on a compositor indicator value of 2.62. This assessment is based on the World Economic Outlook, April 2024 and the 2022 Country Policy and Institutional Assessment.  \nin June 2024. The settlement would not have material impact on the projected timing of reaching a “moderate” risk of overall debt distress.  \n1. The coverage of public and publicly guaranteed debt is the same as presented in the January 2024 DSA (Text Table 1) . The analysis covers external and domestic obligations of the central government , including on-lending to state-owned enterprises (SOEs) . The authorities provide data on debt of SOEs and guarantees provided by the central government on debt contracted by SOEs. Most of SOE guarantees (in terms of amount) relate to the state energy company—Empresa Nacional de Hidrocarbonetos (ENH)—which is involved in the LNG exploitation. SOE domestic debt is included in the DSA , while non-ENH SOE direct external debt is included as a contingent liability. As in the January 2024 DSA, the contingent liabilities stress test includes contingencies linked to debt contracted by municipalities and non-ENH SOE external debt. The DSA update revises the assumed contingent liability down from around 4.9 percent of GDP to 1.5 percent of GDP, due to the authorities’ signed agreement with creditors holding the remainder of the Proindicus obligations and all of MAM obligations (Box 1) . Domestic debt is denominated in local currency, and, for the purposes of the DSA, debt is assessed by currency, as data capturing the residency of creditors are not available. The contingent liabilities stress test assumes realization of contingencies linked to debt contracted by municipalities2 and non-ENH SOE external debt each at 1.5 percent of GDP.3 For these two contingencies , the contingency is estimated to be lower than the default amount for SOE debt based on available information in accordance with IMF policy and LICDSF Guidance No","cbCaiqiLrHDyBt7Y","https://ap.wps.com/l/cbCaiqiLrHDyBt7Y","pdf",1086621,1,25,"English","en",105,"# Risk assessment results\n## External debt distress and overall risk\n## Granularity and judgment\n# Baseline assumptions and key risk factors\n## Downside vulnerabilities\n## Upside considerations\n# Debt coverage and contingent liabilities\n## Coverage of public and publicly guaranteed debt\n## SOE guarantees and LNG-linked liabilities\n# 2013–2016 disputed debt settlement implications\n## Proindicus out-of-court settlements (Oct 2023 and Jun 2024)\n## Domestic T-bonds and cash components","[{\"question\":\"What is the overall and external debt distress risk rating for Mozambique in this joint analysis?\",\"answer\":\"Both the risk of external debt distress and the overall risk of debt distress are rated as high.\"},{\"question\":\"Why does the assessment remain unfavorable despite LNG-related repayment expectations?\",\"answer\":\"Several baseline indicators stay above sustainability thresholds and debt remains vulnerable to downside shocks, even though a large share of future borrowing is linked to LNG projects expected to be repaid from LNG revenues.\"},{\"question\":\"How do the authorities’ out-of-court settlements of disputed debt affect the debt sustainability baseline?\",\"answer\":\"The baseline incorporates fiscal and debt implications of the settlements concluded in June 2024, including the cash and securities components, while the projected timing to reach a moderate overall risk does not change materially.\"}]",1784490826,63,{"code":4,"msg":30,"data":31},"ok",{"site_id":24,"language":23,"slug":32,"title":13,"keywords":33,"description":14,"schema_data":34,"social_meta":86,"head_meta":88,"extra_data":90,"updated_unix":27},"republic-of-mozambique-joint-bank-fund-debt-sustainability-analysis-high-risk-of-distress-assessment","",{"@graph":35,"@context":85},[36,53,68],{"@type":37,"itemListElement":38},"BreadcrumbList",[39,43,47,50],{"item":40,"name":41,"@type":42,"position":20},"https://docshare.wps.com","Home","ListItem",{"item":44,"name":45,"@type":42,"position":46},"https://docshare.wps.com/document/","Document",2,{"item":48,"name":12,"@type":42,"position":49},"https://docshare.wps.com/document/research-report/",3,{"item":51,"name":13,"@type":42,"position":52},"https://docshare.wps.com/document/republic-of-mozambique-joint-bank-fund-debt-sustainability-analysis-high-risk-of-distress-assessment/111591/",4,{"url":51,"name":13,"@type":54,"author":55,"headline":13,"publisher":57,"fileFormat":60,"inLanguage":23,"description":14,"dateModified":61,"datePublished":62,"encodingFormat":60,"isAccessibleForFree":63,"interactionStatistic":64},"DigitalDocument",{"name":9,"@type":56},"Person",{"url":40,"name":58,"@type":59},"DocShare","Organization","application/pdf","2026-07-20","2026-07-19",true,{"@type":65,"interactionType":66,"userInteractionCount":20},"InteractionCounter",{"@type":67},"ViewAction",{"@type":69,"mainEntity":70},"FAQPage",[71,77,81],{"name":72,"@type":73,"acceptedAnswer":74},"What is the overall and external debt distress risk rating for Mozambique in this joint analysis?","Question",{"text":75,"@type":76},"Both the risk of external debt distress and the overall risk of debt distress are rated as high.","Answer",{"name":78,"@type":73,"acceptedAnswer":79},"Why does the assessment remain unfavorable despite LNG-related repayment expectations?",{"text":80,"@type":76},"Several baseline indicators stay above sustainability thresholds and debt remains vulnerable to downside shocks, even though a large share of future borrowing is linked to LNG projects expected to be repaid from LNG revenues.",{"name":82,"@type":73,"acceptedAnswer":83},"How do the authorities’ out-of-court settlements of disputed debt affect the debt sustainability baseline?",{"text":84,"@type":76},"The baseline incorporates fiscal and debt implications of the settlements concluded in June 2024, including the cash and securities components, while the projected timing to reach a moderate overall risk 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