Mozambique court to rule on 'hidden debt' graft scandal

Judges will over the next five days, issue verdicts for the 19 high-profile defendants who include the son of a former president.

The scandal arose after state-owned companies in the country, ranked among the poorest in the world, illicitly borrowed $2 billion (1.9 billion euros) in 2013 and 2014 from international banks to buy a tuna-fishing fleet and surveillance vessels.

The government masked the loans from the country's parliament.

But when the "hidden debt" finally surfaced in 2016, donors such as the International Monetary Fund cut off financial support, triggering a sovereign debt default and currency collapse.

An independent audit found $500 million of the loans were diverted and remain unaccounted for.

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Former finance minister Manuel Chang -- who signed off the loans -- has been held in South Africa since 2018, pending extradition to the US to stand trial for using the American financial system to commit fraud as part of the hidden debt scandal.

President Armando Guebuza, who was in office when the loans were taken out, testified at the trial.

He was not been charged himself, but his eldest son Ndambi was in the dock along with 18 other defendants.

Local civil society organisations and anti-corruption activists are calling for tough sentences.

"The conviction must be strong enough so that it is not annulled or significantly reduced in a second instance court," said Borges Nhamirre, researcher at the anti-corruption non-profit watchdog Public Integrity Center.

But head of the rights group Center for Democracy and Development, Adriano Nuvunga is not optimistic about the outcome and believes that the sentences will be "politically rigged".

The trial which started in August last year, ran for several months and was broadcast live on local TV and radio stations.