| WASHINGTON, Sept 15
WASHINGTON, Sept 15 The president of Mozambique
on Thursday pledged to work with the International Monetary Fund
on the terms of an international audit of its public debt, the
IMF said in a statement.
President Filipe Nyusi met with IMF Managing Director
Christine Lagarde in Washington, where Nyusi visted to try to
reassure international institutions and investors over a debt
scandal involving more than $2 billion in secret loans that came
to light this year.
The IMF has suspended its own lending to the southeast
African country, one of the world's poorest, insisting on
external scrutiny as a precursor to resuming financial aid.
Mozambique's parliament and its attorney general's office
have launched an investigation into the undisclosed borrowings
in 2013 and 2014, but the government thus far has balked at
opening its books to outside auditors.
IMF spokesman Gerry Rice said in a statement issued after
the meeting that Lagarde welcomed initial steps that Nyusi's
government is taking to put the aid program back on track.
Lagarde "stressed the need for further policy action aimed
at stabilizing the economy and for more decisive efforts to
improve transparency, in particular an international and
independent audit of the companies that were funded under the
loans disclosed in April 2016," Rice said.
He added that Lagarde "welcomed that the president indicated
the government of Mozambique's willingness to work with the IMF
on the terms-of-reference for this process - to be initiated by
the office of the Attorney General - and to implement it."
An IMF staff team will be sent to Maputo next week to start
work on these terms, Rice said.
The debt crisis and aid suspension has hit Mozambique hard,
with its currency, the metical, losing nearly 40 percent
against the dollar since January and economic growth slowing to
below 4 percent.
With foreign debt soaring toward 100 percent of gross
domestic product, Mozambique's government has been forced to
revise its 2016 budget, which now shows a deficit equal to 11.3
percent of GDP. The central bank hiked interest rates by 300
basis points in July to try to prop up the currency and contain
Eric LeCompte, director of Jubilee USA Network, a
Washington-based non-profit group that advocates for the world's
poorest people, said he hoped that a balance could be struck
between the need for increased transparency of Mozambique's
finances, and the need to restore aid to the country.
"We have to ensure that those who did nothing to create the
crisis are not the most impacted by the crisis," LeCompte told
(Reporting by David Lawder; Editing by David Gregorio)