"The increase in Mozambique's domestic debt" and a recent "miscommunication highlight the challenges of debt management", although there is hope for the results of future gas exploration, says Moody's.

According to the agency's investor analysis, quoted by Lusa, "although Mozambique is very keen to meet its upcoming debt obligations, the recent late payments, the weak appetite for the domestic government bond market and the rapid increase in domestic debt underline the persistent liquidity problems".

"At stake is the delay in the payment of domestic debt coupons between February and March, a period of increased pressure on state coffers with the increase in the wage bill, among other factors," the agency points out.

Meanwhile, Moody's points out that a new moment of pressure is approaching between September and November, with the government having to deal with the payment of coupons and amortization of domestic debt.

It should be remembered that in May, the idea of re-examining the profile of these disbursements was put forward, however, "the government rectified the statement", saying that it had been "an oversight and that it does not intend to redefine the profile of these instruments".

To this end, Moody's sees this "recent miscommunication with national bondholders" as a sign of "weak debt management capacity".

As a result, the analysis places Mozambique at the 'Caa' level, i.e. in the bracket of high-risk financial instruments.

However, Moody's sees the agreement with the International Monetary Fund (IMF) as a stimulus to move forward with reforms and there have already been measures to curb wage growth.