Financial rating agency Fitch Ratings decided last week, to keep Mozambique’s rating at “CCC+”, three levels above default, but still below the investment recommendation, considering that “substantial risks” remain, such as high public debt.
Mozambique’s rating remains unchanged, as in the assessment of 9 February, and “reflects high levels of public debt, weak management of public finances, low GDP per capita, weak external finances, weak governance indicators and a challenging security situation”, write the analysts at Fitch Ratings, in the note released this Friday, consulted by Lusa.
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On the other hand, they recognise, as in previous assessments, “robust medium-term growth prospects”, which are “supported by the development of the Liquefied Natural Gas (LNG) sector, or by the three-year 456 million dollar Extended Credit Facility agreement signed with the International Monetary Fund (IMF) in 2022 and in force”.
Fitch does not assign an outlook for the evolution of the economy, known as an outlook, to countries that have a CCC’ rating, the third level above financial default.
In the analysis, Fitch revises down Mozambique’s economic growth forecast to 4.0 per cent of Gross Domestic Product (GDP) this year (4.5 per cent in the previous assessment) and 4.2 per cent in 2025 (4.5 per cent previously), which compares with an expansion of 5.9 per cent last year.
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The slowdown in growth compared to 2023 reflects “above all, a smaller contribution from Eni’s floating LNG platform (Coral South)”, which last year already approached maximum production capacity.
