- August 23, 2022
- Posted by: Amos Ekow Coffie
- Categories: Banking and Finance, Economics
The World Bank on Monday gave $300 million to Mozambique in a deal that marks the resumption of its support to the country six years after it suspended aid following a financial scandal involving the government.
The funds disbursed by the multilateral organisation in the form of a grant will be used for infrastructure projects to support the economy and improve the living conditions of the population, said Mozambique’s finance minister, Max Tonela.
This is the first funding to support the state budget that we hope for in the next three years,” Tonela added during the signing of the agreement in Maputo.
The World Bank’s country director for Mozambique, Idah Pswarayi-Riddihough, insisted that the funds allocated by his organisation should come “in support of structural reforms” and extend the efforts undertaken in recent years to strengthen accountability and transparency in the public sector.
The resumption of World Bank aid comes after the International Monetary Fund (IMF) granted its first loan to Mozambique (worth $456 million) in May since the so-called “hidden debt” scandal.
This massive corruption case in one of the world’s poorest countries is linked to secret loans of $1.8 billion from foreign banks to Mozambican state-owned companies, guaranteed by the state.
The trial of nineteen defendants, all close to the government, is underway in Maputo, and the verdict is expected by the end of the year.