Portugal’s sovereign debt crisis prevents credit line agreed with Mozambique from being released

27 July 2011

Maputo, Mozambique, 27 July – The sovereign debt crisis in Portugal is affecting teh release of 300 million euros from a credit line for Portuguese investment in Mozambique, according to Voice of America (VoA) radio.

Portugal opened up a US$125 million credit line for Portuguese companies and business owners that plan to invest in the energy, tourism and manufacturing industries in Mozambique.

Portugal’s Foreign Affairs Minister Paulo Portas said during a recent visit to Maputo that releasing the funding, with a two-year delay, would have to wait “for a better opportunity” given that the Portuguese government was, “tied to the agreement signed with the troika.”

This situation is expected to affect some large projects announced by the previous Prime Minister, José Sócrates on his official visit to Mozambique in March, 2010, in the infrastructure sector the execution of which required funding to be freed up.

The high point of that visit was signing the agreement to set up the National Investment Bank, a Portuguese-Mozambican financial institution with share capital of US$500 million, and which, according to initial projections, was already due to be in operation. (macauhub)