In addition to the controversial 850 million U.S. dollar debt for the state tuna company, Mozambican government is currently facing more critics and questions towards two other hidden debts which were newly disclosed worth over 1 billion U.S. dollars.
The two debts, 622 million U.S. dollars to the defence company Pro-Indicus and 500 million U.S. dollars to the Pemba Logistical Base in the north, drive the country's public debt to GDP ratio from 49 percent to 73.4 percent.
The Mozambican economist Antonio Francisco from the country's think tank, the Institute of Social and Economic Studies, believes that the recent discovery of large debts previously undisclosed by the authorities made the country a case of "disrepute and ridicule" and will have a negative effect on the economy.
"Only a blind optimist who behaves as if he knew that things would never end up worse than they are, can entertain with the idea of the national economy is on track," said Francisco when interviewed by local media.
The values of hidden debt, Francisco continued, can significantly alter the analysis of the country's macroeconomics, even the International Monetary Fund (IMF), at present, is not in a position to scale the impact.
According to the figures available, Mozambique's public debt grew at the startling pace of over 20 percent a year in the past five years, reaching the nominal sum of at least 8.1 billion U.S. dollars.
In 2013, the state-owned Mozambique Tuna Company (EMATUM) issued 850 million U.S. dollar bond to the European bond market, fully guaranteed by the Mozambican state.
Earlier this month, the Mozambican government ratified the deal under which the EMATUM debt was swapped for sovereign government bonds, with a longer repayment period but at a higher interest rate.
Altogether, with the two newly disclosed debts, the southern African nation's public debt has suddenly risen by a further two billion U.S. dollars.
Local media pointed out that in the closing years of former President Armando Guebuza, namely in 2013 and 2014, the public debt got expanded massively, and after the two hidden debts being disclosed, some experts started to believe the prospect of a sovereign default by Mozambique in the next few months has now become likely.
Only in this month, two international rating agency, Standard and Poor's and Moody's, have downgraded Mozambique's ratings, almost entirely because of the transformation of the EMATUM bonds to sovereign debts.
Standard and Poor's has downgraded Mozambique's long- and short-term foreign currency sovereign credit ratings to "SD" (selective default), considering Mozambique in default.
The Moody's rating agency has downgraded Mozambique's rating from B3 to Caa1, considering the exchange of EMATUM notes to be a distressed exchange and therefore "a default on government-guaranteed debt."
The discovery of the two new debts led to a crisis for Mozambique in relations with the IMF, which cancelled a mission to Mozambique and suspended the second instalment of a loan worth 283 million U.S. dollars from the Fund's Standby Credit Facility.
The cancellation directly led to the country's Prime Minister Carlos Agostinho do Rosario flying to Washington, to meet and clarify the details with the Bretton Woods institutions, the IMF and the World Bank.
The country's President, Filipe Nyusi, is also trying to convince the international community that his government would be collaborative and open in dealing with the public debt, saying that the government is facing the problem "frontally" when interviewed during his recent trip to Belgium.
He also believed it would be possible to "restructure" the previously undisclosed debts, just as the EMATUM bond transformation.
Asked about the impact the undisclosed debts would have on the trust of the countries that have supported Mozambique, Nyusi said Mozambique is dealing directly and frontally with the matter, believing that "what is important is the attitude that the country takes.