Manuel Chang, the former finance minister of Mozambique, was sentenced to 8.5 years in prison by a U.S. court on Friday for his involvement in a $2 billion loan scandal. The loans, which were intended to fund state-backed projects in Mozambique’s fishing industry and maritime security, ultimately led to significant financial losses after the projects failed.
Chang, 69, was convicted by a Brooklyn jury in August for conspiracy to commit wire fraud and money laundering. The sentence was issued by U.S. District Judge Nicholas Garaufis, who recommended that Chang be credited for the nearly six years he has already spent in custody. As a result, he could be eligible for release and deportation to Mozambique after approximately 2.5 years.
The loans in question were issued to three state-owned companies and were guaranteed by the Mozambique government. Prosecutors allege that Chang accepted $7 million in bribes from the Emirati-Lebanese shipbuilding company Privinvest in exchange for approving the government’s guarantee for loans from international banks, including Credit Suisse. The loans were meant to help develop Mozambique’s fishing industry and improve maritime security but ultimately failed, leaving the state-backed companies unable to repay the funds.
The financial collapse that followed caused major economic instability in Mozambique. The country’s currency experienced a significant decline, and international donors, including the International Monetary Fund (IMF), temporarily halted their support. This created serious financial difficulties for the government and the population.
Chang’s defense team has argued that he approved the loans under pressure from Mozambique’s president and that there was no evidence that the $7 million was intended for him personally. However, prosecutors emphasized that Chang’s actions placed Mozambique in a difficult financial position.
The case also had wider implications for international financial institutions. Credit Suisse, which was involved in facilitating the loans, reached a settlement of $475 million in 2021 to resolve related bribery and fraud charges. Meanwhile, Mozambique continues to pursue compensation from Privinvest, with a recent ruling in London allowing the country to seek more than $825 million in damages.
Chang has expressed his intention to appeal the conviction. The case highlights the serious impact of corruption at high levels of government, which can have far-reaching consequences for a nation’s economy and its citizens.