Mozambique's flooding could be "very damaging" to the market
Mozambique has declared a state of emergency after flooding that followed Cyclone Idai.
Backdrop: The storm has destroyed an estimated "90%" of Mozambique's fourth-largest city, Beira, which has a population of nearly half a million. So far 1.5 million people have been displaced or otherwise affected by the storm.
- "African economists fear the scale of devastation will be 'very damaging.' Mozambique is already in default on about $2 billion of external commercial debt," Bloomberg's TicToc reports. The country is currently trying to restructure the debt.
Why it matters to the market: The $2 billion default is the result of the almost-too-surreal-to-believe tuna bonds scandal, in which the country's finance minister and supposedly rogue agents from Credit Suisse fleeced Mozambique for at least $200 million in kickbacks and ill-gotten gains, and possibly more than $1 billion.
Where it stands: So far at least a dozen people have been charged by Mozambique for crimes like abuse of office, embezzlement and money laundering. The U.S. is seeking to extradite a number of the main parties involved, including Mozambique's former finance minister and representatives from Abu Dhabi-based Privinvest and Credit Suisse.
- None are yet in U.S. custody, according to recent reporting from the Financial Times.