What led the IMF to reclassify Mozambique's debt as 'unsustainable' in February 2025?

The IMF reclassified Mozambique's debt as unsustainable in February 2025 — down from sustainable in its 2024 analysis — citing a deterioration in public finances, tough financing conditions in 2025, and debt-service arrears estimated at 1.3% of GDP by year-end, including amounts owed to the European Investment Bank and domestic creditors such as holders of short-term government securities.

Why is Mozambique's sole $900 million international bond seen as at high risk of restructuring or default?

Mozambique's sole $900 million international bond, maturing in 2031, is at high risk due to mounting financial pressures: Fitch downgraded the country to 'CC' from 'CCC', citing heightened risk of a credit event through default or restructuring; Wall Street lender Citi named Mozambique — alongside Malawi — as potentially next in the region to default; and an interest payment on the bond is due in September amid distressed market conditions, including a sovereign bond spread of 1,185 basis points over U.S. Treasuries and a contracting economy (−0.5% in 2024).

Why Is Mozambique's Financial Crisis Going from Bad to Worse?

May 5, 2026

Mozambique's debt crisis deepens with IMF reclassification, threatening LNG projects by TotalEnergies and ExxonMobil while fuel and fertilizer imports face inflationary pressure.