The government masked loans from the country’s parliament, but when the “hidden debt” finally surfaced in 2016, donors such as the IMF cut off their financial support.
MAPUTO – Mozambican Finance Minister Adriano Maleiane told a court on Friday that his predecessor covered $2 billion in debt that plunged the country into economic collapse.
Maleiane is one of the most senior government officials to testify so far in the trial over the so-called “hidden debt” scandal.
“As a new minister, the information I had was that recorded in the state accounts,” he told the court, detailing the steps he took to stabilize the Treasury.
His testimony was remarkable simply for his presence at trial in a country where corruption once went unpunished.
He also reminded the court that Mozambique was not making payments on debts incurred without parliamentary approval and hidden in the treasury.
“We don’t pay what are now called ‘secret loans,'” he said.
Mozambique borrowed $2 billion in 2013 and 2014 from international banks to supply a tuna fishing fleet and surveillance vessels.
The government masked loans from the country’s parliament, but when the “hidden debt” finally surfaced in 2016, donors such as the International Monetary Fund halted their financial support.
An independent audit revealed that $500 million had been misappropriated and remained untraceable.
Former finance minister Manuel Chang has been detained in South Africa since 2018, pending a US extradition request to stand trial for using the US financial system to commit fraud in connection with the hidden debt.
On Thursday, former interior minister Alberto Mondlane told the court that foreign investors manipulating naval contracts had “succeeded in penetrating into one of the most important areas of our security”.
“Our security has been captured by the enemy,” he said.