World Bank halts disbursements in Mozambique over hidden debt

On Tuesday, Mozambique said most of the $1.4 billion in previously hidden borrowing had been used to fund maritime security and shipyardsThe World Bank is putting a hold on new development support for Mozambique after the government was shown to have hidden off-budget some $1.4 billion in debt. After the International Monetary Fund suspended aid to Mozambique earlier this month after discovering the hidden debt problem, the World Bank confirmed Wednesday it was putting new allocations of budget support on hold while they review the country’s finances. The Bank told AFP that “further approvals of development policy loans are delayed” while it and the IMF do an assessment of the country’s macroeconomic stability and conduct a debt sustainability analysis (DSA).

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