Funds News

UPDATE 1-IMF says additional $1 bln in Mozambique debt uncovered

(Adds details on IMF loan)

WASHINGTON, April 15 (Reuters) - Mozambique’s government has borrowed $1 billion more than it previously disclosed, the International Monetary Fund said on Friday, adding that the discovery diminished its view of the African nation’s economic outlook.

Antoinette Sayeh, the IMF’s Africa director, told a news conference that the additional funds appeared to have been borrowed from Credit Suisse and Russia’s VTB Bank and allocated to Mozambique’s defense and security sector.

The IMF last year agreed to loan Mozambique $286 million to help cushion its economy following deep declines in commodity prices and the value of the metical, Mozambique’s currency.

“The undisclosed borrowing exceeds $1 billion and significantly changes our assessment of Mozambique’s macroeconomic outlook,” Sayeh said.

Earlier this month, the Wall Street Journal reported that Mozambique had borrowed hundreds of millions of dollars for a state-owned company’s tuna fishing fleet, but that the funds were diverted to buy military speed boats.

The IMF expects to receive more details on the matter from Mozambique’s government soon, Sayeh said. (Reporting by David Lawder; Editing by Paul Simao)