The International Monetary Fund (IMF) said on Tuesday it welcomed Mozambique's agreement in principle to restructure its debt with private creditors, but added the heavily indebted country needed a wider-ranging plan to ensure long-term debt sustainability.

In a statement following its board meeting on Monday, the fund stressed the importance of "strengthening oversight of the entire public debt portfolio, including for State-owned enterprises, to put public debt-to-GDP ratios on a clear declining path".

On Friday the country's finance ministry said it had reached a restructuring deal in principle with holders of its defaulted 2023 bonds and that the new arrangement would not offer creditors instruments linked to future gas revenues.