Former Mozambique Finance Minister Manuel Chang, of Chinese descent, was convicted on August 8 for his involvement in a corruption scandal that led Mozambique to incur a $2 billion debt, plunging the country into a financial crisis. He is facing a maximum sentence of 20 years in prison.
Chang was arrested in South Africa in December 2018 and was extradited to the Eastern District of New York in July 2023.
Between 2013 and 2016, three companies controlled by the Mozambique government secretly borrowed $2 billion from overseas banks. Chang signed guarantees on behalf of the government to repay the loans, which were crucial for lenders to extend funding to these newly established companies.
The trial revealed that the defendant accepted $7 million in bribes, signing guarantees on behalf of the Republic of Mozambique for three maritime projects to secure loan funds. He and his accomplices misled banks and investors by falsely claiming that the loan proceeds would be used for these projects, without bribes being paid to Mozambican government officials. However, Chang and his accomplices facilitated the embezzlement of over $200 million of loan funds, which were used for bribes and kickbacks to Chang and others.
Chief Assistant United States Attorney Nicole M. Argentieri of the Eastern District of New York stated, “Manuel Chang’s abuse of power not only betrayed the trust of the Mozambican people, but his corrupt dealings also resulted in significant losses for investors, including those in the United States.”
The companies that received the loans defaulted, leaving Mozambique burdened with a $2 billion debt, approximately 12% of the country’s GDP at the time. The country, designated one of the world’s top ten fastest-growing economies by the World Bank, suddenly faced financial turmoil, including economic stagnation, rampant inflation, currency devaluation, sharp declines in international investments and aid, and government service cuts. A report released by the Norway-based Chr. Michelsen Institute in 2021 indicated that nearly 2 million Mozambicans fell into poverty as a result.
In 2018, Chang was arrested at O.R. Tambo International Airport in Johannesburg based on a U.S. extradition request. The Mozambican government attempted to have him tried in Mozambique, but the South African court denied the request.
Chang served as Mozambique’s Finance Minister from 2005 to 2015. According to online sources, he hails from the Three Districts of Zhongshan, Guangdong, and is of mixed heritage as a descendant of Mozambican Chinese immigrants.