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Maputo - Mozambique is renegotiating the terms of a controversial $850m bond issued in 2013 to build a state tuna-fishing fleet and bolster maritime security, the Noticias newspaper reported on Friday.
Finance Minister Adriano Maleiane was quoted as telling parliament that the seven-year repayment period for the bond was too short and its interest rate was too high.
"We must find ways to extend the term and bring down the interest rate," Maleiane said.
The state-backed Mozambican Tuna Company (Ematum) paid a yield of 8.50% to sell the bond, which carries a 6.305% coupon.
The southern African nation's first foray into the global capital markets raised eyebrows when it was issued in September 2013 because the bond was not approved by parliament, even though it was backed by a state guarantee.
The intention of the loan - "financing the purchase of fishing infrastructure, comprising of 27 vessels, an operations centre and related training" - was also a departure from the infrastructure needs cited by most frontier African sovereigns.
"We are currently mobilising donors to revisit the Ematum operation because, as you can see, seven years, even with the two-year grace period, is very little time and the rates are high," Maleiane was quoted as saying.
The bond has an amortising structure, giving it a weighted average life of 4.5 years.
The International Monetary Fund has agreed with the government on the need to renegotiate the debt, Noticias said. No-one from the IMF in Mozambique was immediately available for comment.
