Oxford Economics Africa says Fitch's upgrade shows more confidence in Mozambique, but doubts real changes in the country's governance.

"A Mozambique's improved sovereign credit ratings and the resumption of general budget support from the Bretton Woods institutions are signs that confidence in the government is being restored, which is catalyzing more foreign loans and investment," reads an analysis article.

"However, we agree with local commentators" that "virtually little has changed in terms of governance and that there are indications that authoritarianism is indeed on the rise," he adds.

The influx of concessional funding and grants that is in sight "is very welcome and essential to Mozambique's efforts to rebuild the war-torn Cabo Delgado province and finance its budget deficit," the consultancy notes.

Oxford Economics Africa highlights the government's announced plan to apply more than 300 million euros to restore infrastructure in Cabo Delgado over the next three years.

"The Mozambican government is now expected to use its improved access to external financing to implement reforms that will avoid another hidden debt crisis and help stabilize the security situation in the gas-rich northern region," whose reserves "are critical to the country's long-term economy, development and sustainability," it concludes.

The financial rating agency Fitch raised on Friday Mozambique's rating from CCC to CCC+, easing the risk outlook on lending to the country.

"Mozambique's financing constraints have eased substantially with the $456 million credit agreement with the International Monetary Fund (IMF)," he announced.

Fitch expects the deal to give the 'green light' to other forms of "concessional financing from multilateral partners, including the World Bank, after years of restricted access to external sources of funding following the 2016 hidden debts scandal."

The agency forecasts that Gross Domestic Product (GDP) growth will "accelerate to 7.7% in 2024 and remain high until 2026." (Lusa/Noam)