I was amazed to discover that Mozambique had successfully marketed over $700 million US dollar denominated “Tuna Bonds”.
They were named as such because,
“The bond was sold as a plan to create a national fishing industry for the south African country via Ematum — a tuna-fishing company backed by the state. “
But amazingly, somehow, things did not go according to plan:
“However, the majority of the money was spent on security operations associated with the loan.”
“International holders of the bond, which include some of the world’s largest investors, are being asked to exchange close to $700m of the existing 2020 Ematum bonds for new sovereign bonds due to mature in January 2023.”
People, if you changed the word “largest” to “dumbest” the sentence above would be even more true.
And of course another group of dummies chimed in with their two cents:
“The IMF said work on an action plan to improve the profitability of Ematum “should be fast-tracked to reduce its risk to the government budget.””
Yes by all means, let’s pump some more money into that failed and clearly corrupt SOE.
Oh my. It’s the perfect storm. Badly run countries borrowing in US dollars and wasting the money. International investors blithely buying the Brooklyn Bridge over and over. And the IMF just being the most stupid of all the lot.
The story comes from the FT so the link above may be hard to navigate.