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POINTERS:

“Alice in Wonderland” continues. This week’s star performer was former president Armando Guebuza, who told the Parliamentary Commission of Inquiry (CPI) that he would act today in the same way in guaranteeing the US$2.2-billion so-called hidden debts. “We would do just the same again, in the defence of our beloved homeland and the wonderful Mozambican people” (Page 14). Meanwhile, former finance minister Manuel Chang, in the front line to ‘hang’ for the crime, sang, pointing the finger at “pressure” from the Mozambican Secret Service (SISE) for the Finance Ministry to issue State guarantees for Ematum, Proindicus and MAM. He acknowledges that they did not inform the Council of Ministers (Cabinet) or the IMF, nor did they request authorisation from the National Assembly, much less the opinion of the Attorney-General’s Office (Pages 15-18). The CPI’s final report, delivered on Wednesday (7th) to the National Assembly, and debated on Friday (9th) in a secret plenary session, reinforced what we already know - that the debts of the three companies, amounting to 10.6% of gross domestic product (GDP), are illegal. The CPI has decided to prevaricate on the potential criminal liability of senior state officials (Page 13). There is real stress in the upper echelons of the ruling Frelimo party on this issue, which is playing through to a lack of decision-making on a strategy to solve the problem of the breakdown of relations with the IMF and G14 donors. Diplomatic sources indicate that even if Kroll meets its very tight deadline on delivery of its forensic audit by the beginning of March, it is highly unlikely the IMF is going to make a decision on any programme for resumption of funding before June 2017. The big question is how the Government is going to survive financially until then? As things stand Mozambique is set for a catastrophic debt default and a “downward spiral” that will be hard to control (Pages 18-19). There are calls for Mozambique to repudiate these debts on the basis that there was lack of proper due diligence on the part of key lenders and corruption by the beneficiaries. The resistance to repudiation comes from senior Frelimo figures who would be required to admit that the loans were corrupt (Pages 19-21). The diplomatic and foreign investment community are looking for any encouraging signs of competent and courageous political management of this impending crisis. The Mozambique government desperately needs money. Crunch time could come as early as January 2017.

Apart from your special interest subjects, the following are worth reading:

IMF in town (trying to confirm that Kroll has full access), Joe Hanlon (Pages 21-22).

National Assembly approves its own budget – pigs in the trough (Pages 22-23).

Prime Minister’s assessment of economy for 2017 (Pages 23-24).

11% budget deficit for 2017 (Pages 25-26).

Government growth forecast of 5.5% for 2017 (Pages 26-27).

The SISE budget is MT1.8-billion (about US$24.9-million), while only MT534-million is allocated to education, and MT112-million to agriculture and food security (Pages 29-30).

President Nyusi wants Mozambican tourism to revitalise economy. This and agriculture are the best potential for job creation, but are only possible if foreigners investors and visitors generally are relieved of the harassment by predatory “officials” (particularly the police) looking for bribes (Page 30).

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TABLE OF CONTENTS

BUSINESS INDEX .......................................................................................................... 8

ECONOMY & BUSINESS ............................................................................................. 12

GRAPH 1: MOZAMBIQUE CURRENCY EVALUATION ......................................... 12

Macro-economy: ...................................................................................................... 13

Assurances given to creditors violated Constitution: CPI ........................................... 13

Guebuza says he would do the same today in relation to hidden debts .................... 14

“SISE was the promoter and asked us for guarantees” – Manuel Chang .................. 15

Mozambique bondholders call debt-restructuring deadline a “pipe dream” ................ 18

International support to repudiate debt, but Frelimo resists ....................................... 19

IMF in town – Joseph Hanlon ..................................................................................... 21

Assembly approves its own budget ............................................................................ 22

Prime Minister optimistic about economic recovery in 2017 ....................................... 23

Deficit of MT86-billion on 2017 budget ....................................................................... 25

Government forecasts growth of 5.5% for 2017 ......................................................... 26

Assembly passes first reading of 2017 budget with 137 votes in favour, 87 against .. 27

Finance Minister denies Renamo claims on Defence spending ................................. 29

President Nyusi wants Mozambican tourism to revitalise economy ........................... 30

Average commodity prices: 30 November to 7 December ......................................... 30

Tax Authority to strengthen the fight against smuggling of fuel and drinks ................ 31

Government authorises import of basic food products ............................................... 31

INSS recovers over MT1.6-million ............................................................................. 32

National energy potential attracts Chilean investment ............................................... 32

Italian ambassador wants peace for development ..................................................... 33

Click on a title to follow the link to the related article. To return to the Contents Page, click on the link

at the top-right hand corner of the page.

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UAE want to increase investments in the country ...................................................... 33

Presence of Portuguese companies in Africa attracts Chinese companies to

privatisations .............................................................................................................. 34

Financial Services:................................................................................................... 35

Banco de Moçambique says national banks should capitalise to participate in natural

gas projects ................................................................................................................ 35

Banco de Moçambique nominates committee for Moza bank .................................... 36

World Bank involvement in Moza Banco recapitalisation for “transparency” .............. 36

Director of Deloitte & Touche (Mozambique) heads up liquidation committee of O

Nosso Banco .............................................................................................................. 37

Oil & Gas: .................................................................................................................. 37

Government approves key Mozambique LNG agreements ....................................... 37

“Resource exploration must benefit the country” – Minister Klemens ........................ 41

Anadarko issues Expression of Interest ..................................................................... 41

Mozambican political parties unable to formulate policies on natural resources – NGO

................................................................................................................................... 42

Fuel shortages in Beira .............................................................................................. 42

Mining: ...................................................................................................................... 43

A look at Vale SA’s focus in Its coal division .............................................................. 43

Triton debuts new look, renews focus on Mozambique project .................................. 44

Kenmare launches tender for camp services in Nampula .......................................... 45

Odebrecht implements a rigid Programme of Compliance ......................................... 45

Former minister Abreu’s clan tightens hold on mines ................................................ 46

Nuno Uinge, the Abreu family’s favourite partner ....................................................... 47

Transport & Construction: ...................................................................................... 47

China Road and Bridge Corporation builds bridge in Mozambique ............................ 47

Dredging in the Port of Maputo allows it to receive larger ships ................................. 48

Security deal boosts coal transportation .................................................................... 48

Zambia seal railway construction deal connecting to Port of Nacala ......................... 50

Completion of work on two hydro plants in Mozambique postponed to January 201750

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Ambassador Aviation increases competition in Mozambique .................................... 51

Embraer/LAM scandal ................................................................................................ 52

Assembly to question government on Embraer bribe................................................. 53

Guebuza’s in-laws still have a head for business ....................................................... 53

Agriculture & Fishing: ............................................................................................. 54

Government reaffirms priority of ProSAVANA mega-programme .............................. 54

FAO mission defends “agrarian revolution” in Mozambique ....................................... 55

“Consuming eggs and chicken must be no longer a luxury by 2019” – President Nyusi

................................................................................................................................... 56

Obtala’s Mozambique and Tanzania business on the road to profitability ................. 57

Cashew exports may bring Mozambique tax revenues of US$33-million ................... 59

Mozambican company invests in breeding crocodiles ............................................... 60

Workers of the Búzi Company go on strike ................................................................ 60

Telecommunications: .............................................................................................. 60

Mozambique will miss analogue-to-digital deadline ................................................... 60

More than five-million SIM cards blocked ................................................................... 61

Other: ........................................................................................................................ 62

More than 200,000 jobs created this year .................................................................. 62

“Land in Mozambique belongs to the state and to nobody else” – Maputo Mayor

warns Katembe population against selling land ......................................................... 63

Mara Delta expands in Mozambique .......................................................................... 63

Underweight bread on sale in Maputo........................................................................ 64

POLITICS ...................................................................................................................... 65

Decentralisation continues to divide government and Renamo ................................. 65

Joint Commission meets and says nothing ................................................................ 65

Joint Commission to establish a new working group for decentralisation................... 66

Joint Commission still discussing working group ....................................................... 67

Quelimane Mayor disappointed with Frelimo ............................................................. 68

Daviz Simango supports the election of provincial governor in 2019 ......................... 68

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“Peace not just up to me and Dhlakama”, President Nyusi tells FAMOD ................... 69

Renamo expresses interest in achieving peace ......................................................... 70

Dhlakama has faith in the resumption of good relations between the IMF and Maputo

................................................................................................................................... 70

New ministers: put politics in command ..................................................................... 72

Minister Namashulua calls for transparency in elections and CNE wants new

electronic checking system ........................................................................................ 73

Guebuza heads delegation sent by President Nyusi to attend Fidel Castro’s funeral 74

Chissano and Mbeki suggest resumption of Lake Niassa negotiations ..................... 75

The current situation of Mozambique through the eyes of Father Couto ................... 75

SECURITY .................................................................................................................... 81

Renamo attacks armed escort in Sofala Province ..................................................... 81

Jindal train attacked along the Sena Railway Line in Sofala ...................................... 81

Independent journalist attacked in central Mozambique ............................................ 82

Mozambique and Malawi consolidate co-operation in the field of defence and security

................................................................................................................................... 83

Maritime surveillance on agenda in Mozambique – International Maritime

Organization ............................................................................................................... 84

CRIME ........................................................................................................................... 84

GRAPH 2: Incident Type per Month ....................................................................... 84

GRAPH 3: Incidents per Time of Day ..................................................................... 85

Bolivian woman arrested at OR Tambo en-route to Maputo with ZAR2.5-million worth

of cocaine ................................................................................................................... 85

Judges say organised crime attempted to capture the State ..................................... 85

Prison director accused of facilitating escape ............................................................ 86

Traffic police officer handed suspended jail term for beating a man in Xai-Xai .......... 87

Cabo Delgado PRM in pursuit of four armed men ..................................................... 87

Three people detained in connection with the murder of Joaquim Malagueira .......... 88

Robbers raid Mr Bow’s house in Belo Horisonte – brother severely injured ............... 88

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Teenager narrowly escapes lynch mob ...................................................................... 88

Six community members arrested for murdering suspected rapist in Manhiça .......... 89

Man arrested for murdering his colleague in Maputo province ................................... 89

Man arrested for abducting and raping a three-year-old child in Cabo Delgado ........ 89

Police in Manica crackdown on smuggling ................................................................. 89

Twenty people caught trafficking in medicines ........................................................... 90

Governor of Tete catches driver apparently selling fuel ............................................. 91

PRM requests information from Malawian owners of Caphiridzange fuel tanker ....... 91

PRM ensures readiness for the festive season .......................................................... 92

South African autopsy report also finds that Elly Warren was not killed ..................... 92

HUMAN RIGHTS, SOCIAL DEVELOPMENT AND NGO’S ......................................... 94

Mozambique declared free from cluster munitions ..................................................... 94

Students in Niassa pledge to stop attending school until Renamo is in power ........... 95

Southern Africa can avoid climate strife with water agreements ................................ 96

Farmers in the southern region receive 20-tons of seed in order to cope with the

drought ....................................................................................................................... 99

China to co-operate with Mozambique in media sector ........................................... 100

Public prosecutor fights child trafficking in Inhambane............................................. 100

WILDLIFE AND ENVIRONMENTAL PROTECTION .................................................. 101

Government launches sustainable development programme .................................. 101

Poachers shot and killed in Limpopo National Park ................................................. 102

Buffaloes slaughtered in Mágoè, near Cahora Bassa reservoir ............................... 102

Illegal timber exports halted in Nacala Port – 1,200 containers of logs on their way to

China ........................................................................................................................ 103

HEALTH ...................................................................................................................... 104

Nacala Urban Health Centre, receives ambulance .................................................. 104

Mozambique registers 154,000 new cases of tuberculosis in 2015 ......................... 104

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Blood shortage for Caphirizanje victims, particularly O Negative and B Negative –

Tete hospital calls on donors to come to the rescue ................................................ 104

BUSINESS INDEX

Agripec .......................................................................................................................... 60

Air Corridor .................................................................................................................... 51

Alliance Resource Partners ........................................................................................... 44

Ambassador Aviation .................................................................................................... 51

AMG/GK ........................................................................................................................ 44

Anadarko ............................................................................. 19, 37, 38, 39, 40, 41, 42, 55

Anbang .......................................................................................................................... 34

Arch Coal ...................................................................................................................... 44

Baker & McKenzie ......................................................................................................... 34

Banco de Moçambique .................................................................... 13, 23, 24, 35, 36, 37

Banco Espírito Santo..................................................................................................... 36

Bank of Portugal ............................................................................................................ 34

Basic Materials .............................................................................................................. 58

BCP ............................................................................................................................... 35

Black Rock Mining Co. .................................................................................................. 47

BP ................................................................................................................................. 40

CCECC ......................................................................................................................... 50

Cedelec ......................................................................................................................... 51

CFM ........................................................................................................................ 48, 81

China Exim .................................................................................................................... 40

Cloud Peak Energy ....................................................................................................... 44

Coface ........................................................................................................................... 40

Companhia do Búzi ....................................................................................................... 60

Consolidated Mining Services ....................................................................................... 47

Couto, Graças and Associados ............................................................................... 16, 54

CRBC ............................................................................................................................ 47

Credit Suisse ............................................................................................... 18, 19, 20, 21

Daohuaxing ................................................................................................................... 47

Deloitte & Touche .......................................................................................................... 37

Delta International Mauritius .......................................................................................... 64

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DP World ....................................................................................................................... 48

EdM ................................................................................................................... 37, 50, 73

EDP ......................................................................................................................... 34, 35

EFEMM ......................................................................................................................... 47

Elevo Group .................................................................................................................. 46

Ematum .............................................. 2, 12, 14, 15, 18, 19, 20, 21, 24, 27, 28, 39, 54, 66

Embraer .................................................................................................................. 52, 53

Emopesca ..................................................................................................................... 54

Energy Works ................................................................................................................ 47

ENH ............................................................................................................................... 38

ENI ............................................................................................ 19, 24, 33, 37, 38, 40, 55

Etihad Airlines ............................................................................................................... 33

ExxonMobil .................................................................................................................... 40

Fosun ............................................................................................................................ 35

Galp Energia ................................................................................................................. 35

General Electric ....................................................................................................... 52, 53

Gerania ......................................................................................................................... 64

Global Media ................................................................................................................. 35

Greylock ........................................................................................................................ 19

Grindrod ........................................................................................................................ 48

Grupo Videre ........................................................................................................... 46, 47

Hidrokarst Rain Power .................................................................................................. 51

HNA ............................................................................................................................... 35

Hong Kong Golden Jewellery ........................................................................................ 47

IFC ................................................................................................................................ 37

IMF ........................................................... 2, 15, 16, 18, 19, 20, 21, 22, 24, 25, 40, 70, 71

Jan de Nul Dredging Middle East FZE .......................................................................... 48

Jindal ............................................................................................................................. 81

Kenmare .................................................................................................................. 26, 45

Korea Exim .................................................................................................................... 40

KPMG ............................................................................................................................ 36

Kroll ......................................................................................................... 2, 15, 20, 21, 40

LAM ............................................................................................................. 16, 51, 52, 53

Landesbank Berlin Investment ...................................................................................... 18

Lazard Freres ................................................................................................................ 21

MAM .......................................................................... 2, 12, 15, 19, 21, 24, 25, 28, 39, 66

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Maputo Mining ............................................................................................................... 47

Mara Delta ............................................................................................................... 63, 64

McCormick Property Development ................................................................................ 64

mCel .............................................................................................................................. 61

Millennium-BIM ............................................................................................................. 72

Minjar Gold .................................................................................................................... 45

Mitsui ............................................................................................................................. 55

Moçambique Capitais .................................................................................................... 36

Movitel ........................................................................................................................... 61

Moza ............................................................................................................................. 36

Mozambique Eldorado Mining Co. ................................................................................ 47

Mozambique Safaris.................................................................................................... 102

MPDC ............................................................................................................................ 48

Novo Banco ............................................................................................................. 34, 36

Obtala Ltd. ..................................................................................................................... 57

Odebrecht Group .................................................................................................... 45, 46

Orient Africa Resources Co. .......................................................................................... 47

Ovahana Minerais ......................................................................................................... 46

Peabody Energy ............................................................................................................ 44

Pescamar ...................................................................................................................... 27

Pescamoz ..................................................................................................................... 27

Pescas do Centro .......................................................................................................... 54

Petromoc Bunkering ...................................................................................................... 48

Portus Indico ................................................................................................................. 48

Proindicus ............................................................2, 12, 15, 18, 19, 21, 24, 25, 28, 39, 66

REN ............................................................................................................................... 35

Rhodium ........................................................................................................................ 34

ROMPCO ...................................................................................................................... 99

S&P Global Ratings....................................................................................................... 18

SACE ............................................................................................................................ 40

Sasol ................................................................................................................. 26, 52, 53

Sericea Holdings ........................................................................................................... 64

Shandong Tianye Mining ............................................................................................... 45

Sinopec ......................................................................................................................... 35

Société Générale .......................................................................................................... 40

Sonangol ....................................................................................................................... 35

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Soundlight ..................................................................................................................... 88

South Orient .................................................................................................................. 47

SPI ................................................................................................................................ 37

Startimes Software Technology .................................................................................... 61

TAP ............................................................................................................................... 35

TdM ............................................................................................................................... 61

Templeton ..................................................................................................................... 19

TMT ............................................................................................................................... 61

TPM ............................................................................................................................... 16

Transformers Investment .............................................................................................. 64

Transporte Zambeze ..................................................................................................... 54

Transportes Ali .............................................................................................................. 91

Triton Minerals .............................................................................................................. 44

Trust Holding ................................................................................................................. 54

Vale ................................................................................................. 43, 44, 48, 49, 72, 81

Vodacom ....................................................................................................................... 61

VTB ............................................................................................................. 18, 19, 20, 21

Walkers ......................................................................................................................... 91

White and Case ............................................................................................................. 21

World Bank ................................................................................................ 22, 36, 59, 104

Zhoushan Huihang Transporte Maritimo ....................................................................... 54

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Return to Contents Page

ECONOMY & BUSINESS

Mozambique Exchange Rate and Fuel Prices: 9 December 2016

GRAPH 1: MOZAMBIQUE CURRENCY EVALUATION

Mozambique Fuel Prices

Fuel Type Price Per Litre

Petrol 50.02MT

Diesel 45.83MT

Mozambique Metical (MZN) Exchange Rate

Currency Buy Sell

Euro (EUR) 78,85 78,96

U.S. Dollar (USD) 73,48 73,58

S.A. Rand (ZAR) 5,43 5,43

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Macro-economy:

Assurances given to creditors violated Constitution: CPI

The Parliamentary Committee of Inquiry (Comissão Parlamentar do Inquérito, CPI) investigating the debt situation and the controversial guarantees granted by the State for Ematum, Proindicus and Mozambique Asset Management (MAM) financing, has concluded that the budget of Armando Guebuza violated the Constitution and laws of Mozambique.

The CPI’s final report, delivered on Wednesday to the National Assembly and debated on Friday 9 December in a plenary session, reinforces what was already in the public domain: that the debts of the three companies, amounting to 10.6% of gross domestic product (GDP), are illegal, but leaves doubts about any criminal responsibility.

“The Commission considers that the provision of State guarantees, in excess and without authorisation, constitutes a violation of the Constitution and of the budgetary laws, which, in accordance with the regime established in law No. 7/98, of 15 June, prescribe the standards of conduct applicable to the holders of the offices of government and explains their duties and implied responsibilities”, the report concludes.

The report notes that, of the several personalities heard during the investigation, only former president Guebuza; his finance minister, Manuel Chang; and the president of the board of directors of the beneficiaries of the controversial debts, Antonio Carlos do Rosário (not to be confused with current Prime Minister of similar name), had full knowledge of the financing.

The rest, including the former governor of the Banco de Moçambique, Ernesto Gove, and the former director of the Treasury – who signed the guarantees on behalf of the State – “demonstrated a lack of in-depth knowledge of the outlines of the loans and, therefore, gave answers which could help the Commission to obtain information capable of clarifying the public debt on the three companies”, the report says.

Despite the violation, accountability may never happen, since – according to the report – the legislation is unclear about the accountability of senior state officials.

The CPI therefore recommends the legislation be improved “on the identification of the responsibilities of top state leaders who are currently enshrined in very vague and indeterminate legal instruments”.

The Commission nevertheless recommends that the Attorney-General establishes, within the framework of the forensic audit in progress, “effective application of financing contracted” by the three companies, as well as “whether or not evidence of an illegitimate and unlawful exploitation of public funds” by some people or institutions exists, all of which implies doubts on the part of Commission members on the application of the money.

Central to their recommendations, the CPI makes it clear that the State must take the responsibility for paying the controversial debt, which “should be paid by the three companies” without the burden falling on the public purse.

Source: O País

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Guebuza says he would do the same today in relation to hidden debts

Former President Armando Guebuza told the Parliamentary Commission of Inquiry that he would act today in the same way in guaranteeing the US$2.2-billion so-called hidden debts.

“I believe any responsible government would act as we did under the same conditions, and if we were in the same conditions and had to make the same decisions today – considering the circumstances at that time – “We would do just the same again, in the defence of our beloved homeland and the wonderful Mozambican people”, Guebuza told the committee.

Guebuza’s statements are contained in the final report of the CPI, which was released to the Mozambican media on Thursday 8 December.

According to Guebuza, the loans were conceived and arranged in a secretive manner because of classified information held by the Defence and Security Forces, especially the (Serviço de Informação e Segurança de Estado, SISE).

Citing acts of destabilisation by the armed wing of Renamo, the threat of piracy in Mozambican waters and the need to protect the activity of oil companies, Guebuza stated that it was necessary to ensure peace, stability and the defence of national sovereignty and integrity.

According to the Mozambican press, the former head of state reminded CPI deputies of his past as a nationalist fighting Portuguese colonial domination, saying he had been arrested by the PIDE [Portuguese political police].

“I left my family at a very young age to join Frelimo in Dar-es-Salam. On the way, I was arrested, returned to the country and sent to jail at the behest of the PIDE. After leaving, I again fled to join Frelimo, to fight and to liberate the country. It is for the country and with the same sense of patriotism that I live today”, the former head of state said.

Indeed, he said, the work accomplished by himself and former colleagues in government during his two terms as president continued to be a source of pride.

The CPI’s hearings on the so-called hidden debts have now ended, and the final report will be debated by the plenary of the Assembly of the Republic in closed session.

The CPI was set up after it came to light that the government of Armando Guebuza had endorsed loans worth US$1.4-billion to companies where Mozambican intelligence was among the shareholders without informing the National Assembly, as well as another similar loan of US$850-million in favour of Ematum, owned by the SISE.

According to Mozambican press, which reportedly had access to the final parliamentary report, the CPI deputies would have concluded that there was a violation of the Constitution, the budget laws of 2013 and 2014, the law on defence and security policy and currency exchange law in the contracting of the debts.

Its recommendations include a judicial inquiry into the possibility of illegal use of public funds by private persons and the recommendation that the companies benefiting from the hidden loans should

15


bear the burden of the loans in their entirety without any burden falling on the public purse.

The revelation of hidden loans led the International Monetary Fund (IMF) and a group of top State Budget donors to suspend funding for Mozambique pending an international audit, which the Public Attorney’s Office announced in November it had selected North American company Kroll to carry out.

On 25 October, the Mozambican government publicly acknowledged it inability to make forthcoming repayments, asking creditors for loan restructuring and a new package of financial assistance from the IMF.

Source: Lusa

“SISE was the promoter and asked us for guarantees” – Manuel Chang

The issuance of State guarantees for Ematum, Proindicus and MAM were requested from the Ministry of Finance by the SISE. The Mozambican Secret Service even tried to arrange the financing on its own, but faced difficulties and turned to Manuel Chang’s office to request the issuance of State guarantees.

The former finance minister admits that there had been “pressure”, and the urgency of finding funding meant that it exceeded the limit of the guarantee provided for in the Budget Law. He acknowledges that they did not inform the Council of Ministers (Cabinet) or the IMF, nor did they request authorisation from the National Assembly, much less the opinion of the Attorney-General’s Office, because, he justifies in his defence, the funds were an endorsement and not a debt for the State.

In response to the question “why did you make the decision alone?”, Chang replied that he had the power to grant guarantees as per the presidential decree creating the Ministry of Finance – decree 02/2010, of 19 March. In the report of the CPI, there are also statements from other stakeholders involved in the process of setting up the three companies.

But former president Armando Guebuza went on to tell the Commission that it would be difficult to find specific intervention of the head of state in the composition of the companies, since it is a matter of operational domain. “As the head of the executive branch, he receives the information and reports from the heads of departments and, accordingly, gives the necessary recommendations”, the report said.

Constitution of the three companies and contracting of loans:

“I must clarify that the companies are private law, although with the majority share of the State. Being private law, the shareholders decide on its constitution, and it was they who decided. On borrowing, the same reasoning also follows. It was the shareholders who decided to seek funding. Their efforts to raise the funding could not be conducted without the endorsement of the State. The sector emerged, in this case the promoter – which is SISE, to ask us for the guarantees, and it was then that we provided it. The Ministry of Finance decided to issue guarantees, taking into account the powers conferred by the presidential decree (Decree 1/2010, of 19 March, which creates the Ministry of Finance)”.

“Usually, when there is contracting of direct debt by the State, through the

16


Treasury, it is necessary that this financing be approved by the Council of Ministers and that there be a legal opinion of the Attorney-General’s Office. In this case, our conviction at the time was that there would be no debt to the State. We were giving assurance that those companies could carry out (the investment) and quickly repay their debts”.

Reasons to dispense with the legal opinion of the Attorney-General’s Office:

“From our point of view, we were not yet in debt to the Treasury. The endorsement is potential. You can create debt, but you can also not create debt. There were several situations that were given as examples: LAM [Linhas Aéreas de Moçambique] was endorsed to buy airplanes and the TPM was endorsed to buy buses. In both cases, this was not necessary. So, our belief at the time was that companies would pay. Assuming that what is happening, is happening now, then, it is at this point that it must already be submitted as a debt to the decision of the Council of Ministers. (That is), not paying, refer the matter back to the Council of Ministers. We considered that it was not yet indebted to the State and was not a component of the Budget. The creditors themselves, for their safety, asked for legal opinion, but not for the Prosecutor’s Office, precisely because of the business regime. Couto, Graças and Associados were asked by the Mozambican lawyers of the corresponding companies in Mozambique and the company that gave this guarantee was Couto, Graças and Associados. So they (the law firm) gave the assurances that everything was fine”.

“First, the IMF representation in Maputo is an office only. It is not an institution that

discusses policies with the government. Those who discuss policies with governments are the IMF’s missions. We had several letters of intent. That is why I said that the IMF was open to creating a window (allowing the government to resort to commercial financing because the country had reached such a level of growth that financing needs could not be met only with concessional loans).

“Regarding the financing (of the three companies), I have been out of touch with these cases for two years and I have no access to the documentation to see if it has been fulfilled or not (communication with the IMF). But anyway, when things were analysed, the creditor was the one who obliged. But the lender agreed to move forward without this clause (communication with the IMF) being fulfilled. So, I think who should respond, or who would be most interested was the lender. If it was a condition of the Mozambican law, that's fine – then we had to respect it. But if it is the lender who says we have to report to the IMF and then he ends up triggering the financing (without the government reporting to the IMF), I do not see the relevance to discuss this at this time”.

Granting of guarantees outside the legal limits and without Assembly authorisation:

“In relation to the guarantee, we said that in fact there is the amount indicated in the Budget Law and not in the State Budget. Therefore, in the Budget Law there is the value (limit of the guarantee) that unfortunately in this case we do not comply. Even when we were heard from the Prosecutor’s Office, the first thing we said was that we could not comply with the (limit) value of the guarantee. But there is mitigation: this number does not affect the budget (of the State), does not

17


affect the budget deficit and does not affect anything that the budget has predicted in terms of spending for being there. It has no connection with the budget. The revenue has not entered the State, entered into the companies or services from which they receive the funding entered into the enterprises.

“I explained what our thinking about debt was as a component of expenditure and the surety as an indicative value for compliance at a potential expense. The breach was not intentional. When I say it has not been fulfilled, as in other budget lines, I am not saying that we have purposely said we will not comply”.

Have there been pressures to exceed the limit of the guarantee provided by law?:

“Thank you for your support. I think you’ve found the best words to help me. Because when I answered the first question, I explained the reasons that resulted in the guarantees, those reasons are all there. And in view of this decision I had to find a solution to those problems that I referred to. In fact, we have advanced in the issuance of the guarantee. But it was really the question of pressure, the urgency of solving those problems that made us exceed the limit of the Budget Law in terms of guarantee. That’s exactly it. I thank you. I thought I had referred to this when I answered the first question. But I say again that there has never been any intention to fail to comply with the legal basis for implementing the budget.

“When I speak of urgency, it is already time for the State to be involved. But in the previous phase, companies have been trying to finance, but unfortunately, they have not. And it would have been better if they had obtained the funding without the State’s endorsement.

(Therefore), when I speak of urgency, it is already in the (phase) intervention of the State for such granting of the endorsement”.

Submission by the government to the jurisdiction of the English courts and waiver of their immunity:

“In contracting financing in London, it is very difficult to get them to accept that the contract is governed by beneficiary legislation, in this case, there are Maputo courts to resolve conflict situations. We did everything we could, but we could not prevent them from demanding these (English) courts and this has been the practice for this kind of situation.

“In any case, we think there have been understandings that also benefit us, understandings of magnanimity in situations where clauses are not fulfilled. And we now have the situation that is being postponed by creditors, given this understanding of the issue. But the direct answer is this: we have not been able to accept that there is any other type of jurisdiction other than English in the contracts. And we were interested. For us, requests for funding were very urgent. Unfortunately, we were not aware that we could be giving up sovereignty, given that this happens several times when there is this type of financing. This is the understanding that comes”.

Legal basis for Treasury director to sign guarantees on behalf of the State:

“What I know, because I was also National Director of the Treasury, is that as long as there is a credential from the head of Finance, the director (of the Treasury) can sign. There are many financing agreements signed by an assistant director. But you have to have

18


the folder holder’s credential saying you can sign”.

Chang asked if the National Treasury director (Isaltina Lucas, current Deputy Minister of Economy and Finance) would be accredited, Chang said he was unaware of the existence of the contract signed by her (Treasury director) and did not remember if she had made a credential for this purpose.

Deputy Minister Lucas confirmed to the CPI that: “by the procedures that exist and there being a credential of the minister, may the director of the Treasury, but the guarantee valid is a guarantee signed on 14 June 2013 by the Minister of Finance” (Manuel Chang).

On the document signed on 15 January 2013, giving State guarantees for the financing of US$372-million by Credit Suisse International for Proindicus, Deputy Minster Lucas said that it was not a guarantee contract, but rather the document on the terms and conditions of the contract.

Source: O País

Mozambique bondholders call debt-restructuring deadline a “pipe dream”

Debt-ridden Mozambique has no chance of meeting its year-end deadline for a restructuring deal, according to investors who are preparing to dig in their heels until the country comes clear on what it owes and to whom.

The southern African country, one of the world’s poorest, has seen its currency and investor confidence collapse since April, when the IMF halted a loan after uncovering previously undisclosed debts that had not been approved by

parliament. Mozambique says its debt position is “unsustainable”, and wants an urgent restructuring agreement with commercial creditors so a new IMF loan can be approved. Without this, the economy will face a “downward spiral” that would be hard to control, it warned.

But creditors insist there is nothing to negotiate until they see an international audit of State firms’ loans requested by the IMF and an outline of what sort of engagement the fund would envisage going forward.

“Agreeing a deal before year-end, that is a pipe dream. If you stick to the conventions, the IMF will do its debt sustainability analysis that will tell you just how solvent the country is, and on this basis you can come up with a restructuring”, said bondholder Lutz Roehmeyer, director at Landesbank Berlin Investment.

“But if you don’t have those numbers, then you simply can’t do that, so that request from Mozambique is utopian”, he said.

The commercial debts at the center of restructuring efforts comprise a US$727-million Eurobond and about US$1-billion in state-guaranteed loans.

Those loans, which came to light in April as borrowings from Credit Suisse and Russia’s VTB, had not been disclosed to investors who had only just participated in restructuring a bond issued by state fishery Ematum.

S&P Global Ratings analyst Gardner Rusike says without a timely restructuring and IMF loan, it would be “a difficult 2017” for Mozambique, with external debt surpassing 100% of annual output.

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Baking a cake:

Documents published by Mozambique in November show the outstanding principal of the loans as US$1.132-billion and owed by two state firms, MAM and Proindicus. It is unclear where the money went. The MAM loan was earmarked for a fishing port which never materialised. Proindicus planned to use the cash for maritime security. Ematum’s tuna fishing project, too, was a fiasco with boats rusting in Maputo harbour.

But according to the IMF, the undisclosed debt – including bilateral loans contracted between 2012 and 2015 – amounts to US$1.37-billion.

Meanwhile, some bondholders, including Templeton and Greylock, have formed a group. Some of the members have retained restructuring expert and former IMF official Charles Blitzer as their advisor.

Blitzer is adamant that restructuring talks can only start when Mozambique releases the results of an external audit and it becomes clear what programme has been agreed with the IMF.

“It’s like baking a cake – you need all the ingredients, and you don’t just put them in randomly, and you don’t put it in the oven until everything has been put in in the right order”, Blitzer told Reuters. Mozambique must also commit to “inter-creditor equity”, he said, referring to equal treatment for loan and bond creditors.

But bondholders say that as they have already accepted one debt swap and loan creditors must now take some pain. One fund manager told Reuters that bondholders also wanted bilateral lenders

to be included in burden-sharing, but that was “not on the table”.

Meanwhile, the government has already defaulted on loan payments and is unlikely to pay a nearly US$60-million Eurobond coupon in January. Its legal advisor says maturity extensions, coupon reductions and even write-downs are possible.

But bondholders disagree – many note Mozambique’s energy wealth may bring substantial dollar earnings from 2021.

While final investment decisions by ENI and Anadarko on Mozambique’s liquefied natural gas (LNG) projects are still outstanding, its 85-trillion cubic feet (tcf) of gas reserves are enough to supply Germany, Britain, France and Italy for nearly two decades.

“That is why we, and why a lot of other bondholders, want to wait and see until 2022 and negotiate then. We have got time to do that”, Landesbank Berlin’s Roehmeyer said.

Source: Reuters

International support to repudiate debt, but Frelimo resists

There is surprising support from lenders and donors for Mozambique to repudiate part of the secret debt. One important donor said that: “I would not like to see my money being used to repay these creditors”. But resistance to repudiation comes from senior Frelimo figures who would be required to admit that the loans were at least partly incompetent or corrupt.

The US$2-billion in secret loans were organised by Credit Suisse and the Russian state-owned bank VTB. Investors

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were sold bonds or pieces of the actual loans. Thus, is it argued that Credit Suisse and VTB have a fiduciary duty to those buying the bonds and loan pieces to determine that what is being sold is as offered, and has a reasonable chance of being repaid. Similarly, in organising a loan to one of the poorest countries in the world, the banks had a responsibility to determine if the loans were for viable projects. Thus, banks are expected to undertake what is called a “due diligence” assessment.

Due diligence would have shown that the loans were not government guaranteed, because that requires parliamentary approval – independent of claims from the Finance Minister. It would have shown that the prices of what was being purchased were inflated, and that the incomes being projected for the companies were not justified by the amount of tuna available, potential maritime traffic, and possible gas security contracts.

Further, due diligence would have shown that the loans were larger than the purchases proposed, meaning money would go for purposes not listed – including military purchases and corruption, which is not permitted by many lenders and investors. Finally, part of due diligence is informal contact with the IMF, which apparently did not happen, and would have shown total Mozambican debt to be larger than that stated publicly.

The case against Credit Suisse and VTB is that either due diligence was not done, or it was ignored and not communicated either to Mozambican authorities or to buyers of the loans and bonds. Just as the vendor is responsible for the sale of an obviously false or unsafe product, so Credit Suisse and VTB are responsible for

the sale of bonds and loans which would not have passed due diligence. Credit Suisse and VTB are also guilty of “loan pushing” – encouraging Mozambique to take on debts which they do not need and which are inappropriate. Together, this makes the loans “illegitimate”.

Rather than defaulting on the debt – that is, simply not repaying – Mozambique would have to repudiate the debt, saying it is illegitimate and should not be repaid. Perhaps surprisingly, there is strong support in private by donors and lenders for such an action by Mozambique. There is no precedent for such an action, but donors and lenders see the conduct of Credit Suisse and VTB as so egregious that they would encourage the action. And they expect the Kroll audit to show that the loans were grossly improper and that Credit Suisse and VTB failed to comply with their own rules.

However, the government and Frelimo seem unwilling to take such a position. Many in Frelimo believe, and government-aligned commentators have written, that the loans were good and reasonable. Even if not used entirely as initially claimed, the money was well spent to defend against Renamo, and to win the 2014 elections and support Frelimo. And the loans could have been repaid if gas prices had not fallen. This group argues that donors are hostile to Frelimo and supporting the opposition, and criticism of the loans and demands for an audit are just an attack on Frelimo.

The package of debt is complicated. There are three loans:

Ematum, US$850-million in bonds organised by Credit Suisse and VTB in 2013, to be repaid over seven years, with a two-year grace

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period, and at an interest rate of LIBOR (London Inter-Bank Offered Rate) plus 6.5%. (12 month US$ LIBOR is currently 1.6%) In April this year the Ematum bonds (down to US$697-million after the first repayments) were exchanged for government bonds for US$585.5-million that mature in 2023 (this is a “bullet bond”, with interest paid twice a year but capital is not repaid until 2023) but the interest rate went up to 10.5%.

Proindicus, US$622-million in loans from Credit Suisse, broken up and sold on to investors. Interest only 3.75%. The payment schedule is US$119.424-million plus interest on 21 March every year up until 2021. The first, and so far only payment, was US$24.88-million of capital on 21 March 2016.

MAM, US$535-million in loans from VTB, broken up and sold on. Interest LIBOR plus 7%. Final maturity date is 23 May 2019. MAM should pay the principal in instalments of US$133.75-million on 23 May every year between 2016 and 2019, but MAM failed to pay this year.

It is argued that by renegotiating the loan and issuing government bonds, Mozambique has accepted liability for the Ematum loan. But it might still be possible to repudiate the Proindicus and MAM loans. It would be for a UK court to decide if the declaration of the Ministry of Finance should be taken at face value, even if due diligence would show that it could not give a loan guarantee.

In its statement to creditors in October, the Ministry made clear that it was the

secret loans which destroyed Mozambique’s ability to pay. Debt service for 2017 is projected at US$804-million, of which US$591-million is Ematum, Proindicus and MAM. The Ministry of Economy and Finance made clear that no debt service payments were possible and called on creditors “to engage urgently with its financial and legal advisors, based on the principles of transparency, good faith and inter-creditor equity”. These advisers are the French company Lazard Freres and the international law firm White and Case.

Source: Mozambique News Reports and Clippings

IMF in town – Joseph Hanlon

An IMF mission led by Michel Lazare, IMF mission chief for Mozambique, is in Maputo for an unusually long time (1-12 December) to “initiate discussions … on a new programme”, and the IMF pointedly notes that: “discussions will continue in the first part of 2017”. In practice, the earliest that any agreement could be reached is mid-2017.

The IMF Board on 21 November “found that the Republic of Mozambique had breached [its] obligation, as the authorities had reported inaccurate data with respect to the stocks of central government and central government guaranteed debt”. The new information means that all of the IMF reviews since 2010 must be recalculated. In practice, a major purpose of the mission is to sort out the books – in particular the complex internal debts of the government and state companies to each other – and reassess the state of the economy. The mission will try to confirm that Kroll has full access and will talk to Mozambique’s debt advisors on progress with regard to rescheduling. And it will

22


look for further policy adjustments and austerity. The 21 November Board statement said that the failure to report external borrowing of US$1.37-billion (10.6% of 2015 GDP) constituted “misreporting” and “a breach of obligation”. The Board “noted that the previously undisclosed debt has played a key role in making Mozambique a heavily indebted country, and has placed the government’s finances and international reserves under considerable strain”.

Mozambique’s debt is in dollars, but debt ratios are calculated in meticais. Thus the 100% devaluation, triggered by the revelation of the secret debt, has caused the value of the total debt to double, making Mozambique debt distressed.

The Board’s 21 November statement was carefully nuanced. The “Executive Board welcomed remedial measures already taken, including the launch by the Public Prosecutor of a criminal investigation into the debts incurred by certain state-owned entities, and an independent audit of these entities by an international auditing company. Executive Directors did not to require any further action but called on the authorities to implement the announced measures in a comprehensive and timely manner”. In other words, continued negotiations on an IMF programme depend on continuing criminal investigations and co-operation with the audit.

Mozambique needs money. An IMF agreement would release at least the promises of money from the IMF, World Bank, and European Union (EU), which would sharply reduce the fiscal problems and shortage of dollars.


Assembly approves its own budget

On Tuesday 6 December, the National Assembly approved its own budget for 2017, with all opposition deputies abstaining and protesting that the Assembly could not do its job properly unless it received more money.

The total budget approved is MT1.181-billion (about US$16.3-million). Of this sum, MT1.106-billion comes from the 2017 State Budget, and MT75.4-million from assorted foreign donors and partners (the European Union, the United Nations Development Programme, and the Westminster Foundation).

As happens every year, deputies from the rebel movement Renamo complained that the budget was nowhere near large enough to allow the Assembly to monitor the activities of the government.

“The government wants to subordinate the deputies”, complained Juliano Picardo, ignoring the fact that the government only proposes the State Budget, and it is the Assembly that approves it.

“The limits imposed by the government mean that this budget only covers 76% of the Assembly’s needs”, Picardo claimed.

But Mateus Katupha, of the ruling Frelimo Party, pointed out that the original proposal from the Ministry of Economy and Finance was for a much smaller allocation to the Assembly. In the draft State Budget that allocation was MT977-million.

There was no way this could cover the Assembly’s running costs, Katupha lamented, and it meant that the Speaker of House, Verónica Macamo, would have

23


to negotiate an increase – as she had done in previous years.

Macamo and the Deputy Speaker, Antonio Amelia, assured the deputies that was precisely what the Assembly’s leadership was doing. “There have been meetings with the government to resolve this deficit, and reduce the gap between our proposal and that of the government”, said Amelia.

By far the largest item in the budget is euphemistically described as “other expenses on personnel”, and amounts to MT555.3-million. This covers the wages and allowances paid to the deputies themselves.

Unlike the Assembly budgets of the 1990s, no details are given on how much each deputy is paid. Chairpersons and members of commissions are paid more than deputies who do not sit on commissions, but this specific information is missing. Nor does the budget state exactly how much will be spent on rent allowances, constituency allowances and entertainment allowances.

It is, however, easy enough to work out an average figure, and it turns out that, in 2017, each deputy will be paid, in wages and allowances, an average of MT185,842 (US$2,563) a month.

The lowest of the country’s statutory minimum wages is MT3,298 a month (for agricultural workers). Deputies earn, in wages and allowances, 56 times that sum.

The other major items in the budget are the wages paid to Assembly employees (MT162.5-million), goods and services (MT196.2-million), and current transfers, including membership fees for

international bodies, and medical care (MT128-million).

The capital budget breaks down into MT63.7-million from the State Budget, and MT75.4-million from the Assembly’s foreign partners.

When the vote was taken, the budget passed with the 135 Frelimo deputies present voting in favour and 85 deputies from Renamo and the Mozambican Democratic Movement (MDM) abstaining.

Source: Agencia de Informacao de Moçambique

Prime Minister optimistic about economic recovery in 2017

Signs of recovery in the Mozambican economy allow some optimism for the coming year, according to Prime Minister Carlos Agostinho do Rosário.

Speaking on Wednesday 7 December, in the National Assembly, where he introduced the government’s Economic and Social Plan for 2017, Prime Minister Rosário gave, as an example of recent stabilisation, an improvement in the exchange rate of the metical.

In October the metical had fallen to around MT80 to the US dollar, but by this week it had recovered to MT73 to the dollar. At the same time the draining of Mozambique’s net international reserves seems to have halted. Between October and the first week of December, the reserves increased by MT60-million, said Prime Minister Rosário, due mainly to the sale of foreign exchange by the commercial banks to the Banco de Moçambique.

Prime Minister Rosário admitted that there had been a sharp slowdown in the

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economy earlier in the year, which he blamed on a combination of drought, the armed attacks by the Renamo rebels on some of the country’s main roads, the fall in international commodity prices, reduced flows of foreign direct investment, and the suspension of direct budget support by some of Mozambique’s main foreign partners.

Donors and funding agencies cut their support to Mozambique in the wake of the scandal of well over a billion dollars of loans to the security-related companies Proindicus and MAM that were illicitly guaranteed by the previous government, headed by president Armando Guebuza. Those loans and guarantees were not disclosed, either to the Mozambican public, or to the IMF and other foreign partners, and have made the country’s foreign debt unsustainable.

Prime Minister Rosário said that annual economic growth in 2016, far from reaching the target of 7%, was only 4% in the first three quarters of the year. The cost of living soared as the average 12 monthly inflation rate reached 15% in September. (According to the Banco de Moçambique, the accumulated inflation rate from January to December is likely to reach 30%).

Prime Minister Rosário said the government had acted by revising the 2016 Budget to adjust public expenditure to the real capacity to raise revenue, and had restructured the State business sector “to minimise fiscal risk and promote economic and financial efficiency”.

Important steps had been taken in exploiting the country’s natural resources, he added, including the plans for a floating liquefied natural gas plant operated by a consortium headed by the

Italian energy company ENI, above the Coral South gas field, in the Rovuma Basin off the coast of the northern province of Cabo Delgado. In the south, investment plans had been approved for expanded exploitation of natural gas and light oil in the Pande and Temane region of Inhambane Province.

Such projects opened good prospects for the coming year, said Prime Minister Rosário, “which will be expressed in the creation of more jobs and business opportunities”. To restore international confidence in Mozambique, he added, the government was committed to an independent international audit of Proindicus, MAM and Ematum. Between them the loans to these three companies added 20% to Mozambique’s foreign debt.

At the same time, Prime Minister Rosário said, the Assembly itself is holding its own inquiry into the public debt, and negotiations with creditors are under way to restructure the debt, in order to make it sustainable.

These steps, the Prime Minister said, were regarded positively by the IMF, which had decided to start talks with the Mozambican authorities for a new programme of financial assistance. An IMF mission arrived in Maputo a week ago to begin these negotiations.

The government, Prime Minister Rosário said, believed that a new programme with the IMF, “together with the fiscal and monetary adjustment measures under way, will contribute to the consolidation of macro-economic stability and the relaunching of sustainable economic growth in the medium-term”.


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Deficit of MT86-billion on 2017 budget

On Wednesday 7 December, the government presented to the National Assembly a State Budget for 2017 with a primary deficit, before grants, of MT85.955-billion (approximately US$1.2-billion).

Total revenue envisaged in the budget is MT183.147-billion, while forecast public expenditure amounts to MT272.288-billion.

The country budgeted for a deficit of 11% of GDP this year, high by international standards, at a time when it had the financial support of the IMF.

Covering this deficit is a challenge, given

that all 14 donors and funding agencies who used to provide direct budget support suspended all further contributions last April, in the wake of the scandal of over US$1-billion worth of hidden debt. This debt took the form of loans to the security related companies Proindicus and MAM, illicitly guaranteed by the previous government, headed by president Armando Guebuza.

Introducing the budget, the Minister of Economy and Finance, Adriano Maleiane, expected the deficit to be covered mostly by loans – foreign loans (MT50.8-billion), and domestic loans (MT21.8-billion). The foreign grants expected shrink from MT18.2-billion this year to just over MT14-billion in 2017. Minister Maleiane did not say exactly where the foreign loans and grants will come from.

As for the breakdown of expenditure, 68.8% of the total budget (once financial operations and debt servicing have been excluded) goes on economic and social sectors, compared with 64.2% in the 2016 budget. Education takes the largest slice of the budget, accounting for 23% of expenditure (up from 21.7% this year).

Health expenditure, however, declines from 11.7% of the 2016 budget to 10.1% for 2017.

Spending on infrastructure rises from 17.1% to 17.7% of the budget. But within that category, the major increase is for water supply and public works, which take 7.7% of the budget compared to 4.1% this year. Expenditure on roads falls from 11.7% to 8.5%. Mineral resources and

External Resources

24%

Internal Credit

8%State Revenues

68%

Financing to the BudgetFinancial

Operations13%

Investment Expenses

30%

Operating Expenses

57%

Expenses

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energy have much the same share of the budget 1.3% in 2016, 1.4% in 2017.

Agriculture and Rural Development also increase their share of the budget, rising from 7.9% to 8.7%. The share for transport and communications almost triples, increasing from 1.2% to 4.3%.

There is also a substantial increase in expenditure on social welfare and labour rising from 2.6% to 3.6% of the budget. But spending on the judicial system contracts from 1.9% to 1.5%. Minister Maleiane said that the recruitment of new staff for the public administration is being restricted to education, health, agriculture and the police. In these areas 12,915 new staff will be recruited (compared with 13,733 in 2016). Most of the new employees will be teachers – 8,306, compared with the 9,000 teachers recruited this year.

No money is available for any promotions or progressions along the career structure in the public administration, Minister Maleiane added.

He also promised continued restrictions on the use of goods and services in the public sector – notably on travel, fuel and communication costs. The holding of seminars and sector meetings and the hosting of international event would be “rationalised”, and projects to build or rehabilitate public buildings will be delayed.

The public debt will be tightly managed, the Minister pledged, and will be restructured in order to ensure its sustainability.

Source: Agencia de Informacao de Moçambique/Reuters

Government forecasts growth of 5.5% for 2017

The Mozambican government’s Economic and Social Plan for 2017, introduced by Prime Minister Carlos Agostinho do Rosário in the National Assembly of the Republic, on Wednesday 7 December envisages annual economic growth of 5.5%.

The target growth rate for 2016 was 7%. Although the final figures are not yet available, the current forecast is that growth this year has slumped to 3.9%.

The main driver of growth in 2017 is expected to be the extractive industry with a forecast growth rate of 24% (compared with an estimated 13.2% this year). The revival in international coal prices is expected to lead to an increase in the amount of coal mined from 7.8-million tons this year to rather more than 11-million tons in 2017.

The vast reserves of gas in the Rovuma Basin, in the far north, will not come on stream for several more years, but the plan projects an increase of 4.4% in the gas extracted in the Pande and Temane fields in the southern province of Inhambane, operated by the South African petro-chemical giant, Sasol. The same fields produce condensate, or light oil, and production is expected to increase by 21%.

The dredge mine at Moma, in the northern province of Nampula, operated by the Irish company Kenmare Resources, is expected to increase very substantially its production of titanium ores. Production of the main ore, ilmenite (titanium iron oxide) will more than double, from just under 600,000-tons this year to a projected 1.28-million tons in 2017.

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Agricultural and livestock production is expected to rise by 5.9%. But the target for grain production is a rise of 14%. The forecast is that maize production will rise from about 1.8-million tons this year to just over two-million tons in 2017.

A 25% increase in rice production is expected so that the 2017 rice harvest will be 413,000-tons, compared with 331,000-tons this year. As for root crops, cassava production is expected to grow by 20%, from 9.1-million tons this year, to 10.92-million tons in 2017. The rise in sweet potato production should be 12%, from 1.6-million to 1.8-million tons.

Turning to cash crops, the plan forecasts a 28% increase in sugar cane production, a 19% increase in cotton, and a 15% increase in cashew nuts. The output from manufacturing industry is forecast to rise by 5.8%, while electricity production should rise by 16%. Fishery production should rise by 4.4%. The most important commercial fishery resource is prawns and production is expected to rise by 15%, from around 3,000-tons this year to 3,435-tons in 2017.

The section in the plan on fisheries makes no mention at all of Ematum, the company which acquired 24 fishing boats in 2013-14 as part of an US$850-million loan from European banks, illicitly guaranteed by the government.

Instead the Beira-based company Pescamoz will fish for tuna with just six boats. Agencia de Informacao de Moçambique asked the Minister of the Sea, Inland Waters and Fisheries, Agostinho Mondlane, if these were Ematum boats on loan to Pescamoz. He said he did not know, and that such matters were dealt with between the companies with no intervention from his

Ministry. It is almost certain that these are indeed Ematum boats, since the possibility of farming out the Ematum boats to Pescamar was mentioned in August, during the Maputo International Trade Fair (FACIM). This means that the other 18 Ematum boats may well lie idle throughout 2017.

With the Pescamar deal, commercial tuna fishing by Mozambican boats is expected to rise from 417-tons this year to 900-tons in 2017. This is dwarfed by the foreign vessels licensed to fish for tuna in Mozambican waters. Their catch is expected to rise by 60% from 3,193-tons this year to 5,100-tons. Ironically, Mozambican artisanal fishermen, who never thought of asking for a loan of US$850-million, catch much more tuna than Ematum. The artisanal tuna catch this year was 2,050-tons, and is predicted to reach 2,762-tons in 2017.


Assembly passes first reading of 2017 budget with 137 votes in favour, 87 against

On Thursday 8 December, the National Assembly passed the first reading of the government’s budget for 2017. As with all previous budgets, the opposition voted against. The budget therefore passed with 137 votes in favour, from deputies of the ruling Frelimo Party, while the 89 deputies present from Renamo and from the MDM voted against.

Total revenue envisaged in the budget is MT186.333-billion (approximately US$2.57-billion, at current exchange rates) while forecast public expenditure amounts to MT272.288-billion. That leaves a deficit of MT85.955-billion.

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On the second day of the debate, Frelimo deputies repeatedly called on Renamo to lay down its weapons and end its low-level insurgency. “The government’s work in some parts of the country is being disrupted by Renamo”, declared Esmeralda Mutemba. “How many children are unable to go to school because of Renamo attacks? How many peasants are unable to till their fields?”

“The government is trying to defend the population from the atrocities of Renamo”, said Valdemiro Nhachengo. “It’s Renamo that kills, mains and robs. Renamo is a plague and should be extirpated”.

“Renamo doesn’t know what it’s doing, doesn’t know what it’s saying. They’ve lost all sense of direction”, accused Helder Injojo. “Mozambicans want to see the country grow and develop and they know that only we, Frelimo, will do that”.

Several Frelimo deputies pointed out that Renamo deputies always vote against the State Budget, but also always collect their wages which are paid out of the State Budget. “It’s been like this ever since 1994 (the date of the first multi-party elections)”, said Lutse Rumeia. “This opposition does not grow”.

Renamo deputies claimed the government’s 2017 Economic and Social Plan and the accompanying Budget were unrealistic and deceitful, and that crime and corruption are the order of the day.

José Samo Gudo claimed that financial scandals and theft of funds in public companies were characteristic of the economic disaster overtaking the country. “Mozambique has been handed over to highly organised gangsterism”, he claimed.

António Muchanga, who is also the Renamo national spokesperson, alleged that the government is sabotaging the peace talks currently under way in Maputo, and made the familiar claim that the government wants to assassinate Renamo leader Afonso Dhlakama, who is currently living in a military base in the central district of Gorongosa.

For the MDM, Silverio Ronguane said the government “is dragging the entire Mozambican people to disaster”, because of its “criminal and unpayable debts”. He demanded that the government suspend any further guarantees of loans, until the full truth is known about the loans illicitly guaranteed by the previous government to the quasi-public companies Ematum, Proindicus and MAM.

Winding up the debate, Prime Minister Carlos Agostinho do Rosário insisted that there are good prospects for economic recovery in 2017, particularly in agriculture. He believed that the latest reforms, exempting most agricultural inputs from customs duties and from Value Added Tax (VAT), will encourage agricultural production.

There were signs of stabilisation, particularly of the exchange rate. Over the past few weeks, the metical had gained significantly against other currencies, and Prime Minister Rosário urged businesses to ensure that these exchange gains are reflected in the prices they charge.

But he warned that securing improvements would depend on achieving “a lasting peace”.


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Finance Minister denies Renamo claims on Defence spending

On Thursday 8 December, Finance Minister Adriano Maleiane categorically denied claims by Renamo that the budget for 2017 is dominated by the defence and security sectors.

Speaking on the second day of the debate on the 2017 Plan and Budget in the National Assembly, Minister Maleiane said that, in percentage terms, defence and security receives a smaller share of the 2017 Budget than of this year’s Budget – the amount spent on all defence and security (the defence and interior ministers, the armed forces, the police and the security service) has fallen from 7.3% to 6.6$ of total public expenditure.

This, he pointed out, was considerably less than the 10.1% allocated to health. “We would like to spend more on health and we would like to spend more on defence”, said Minister Maleiane. Year after year Renamo has claimed that the State Budget prioritises the army, the police, and the SISE, and year after year the government explains that this is not true.

This year the independent newssheet Mediafax repeated these claims. Its front-page headline on Thursday read ‘Repression and security remain at the top’. Although Mediafax is typically a well-informed and reliable paper, it fell into the trap of not reading the entire Budget, and so presenting a distorted picture.

The State Budget contains both a budget for running costs and a capital budget. It is also divided into central and provincial levels, all of which must be considered. SISE, the armed forces and the President’s Office all have their budgets

centralised, but education, health, agriculture and public works are decentralised, with most of their expenditure allocated to the provinces. Renamo habitually ignores the provincial budgets, and this year so did Mediafax.

Mediafax confidently stated that the SISE budget is MT1.8-billion (about US$24.9-million), while only MT534-million is allocated to education, and MT112-million to agriculture and food security. All of these figures are accurate, but refer only to the running costs budget at central level. When the capital budget is taken into consideration, and all the provincial expenditure, the full education budget turns out to be MT48.287-billion, and the agriculture budget is MT18.216-billion.

The SISE capital budget is MT91.6-million and there are no SISE provincial budgets. So the total SISE allocation is just short of MT1.9-billion. The budgetary allocation for education is thus 25 times as large as that for SISE. Facts and figures, however, did not stop Renamo from saying the opposite throughout the debate. The Renamo group in the Assembly’s commission on public administration claimed the Budget “prioritises non-productive sectors such as the Presidency, SISE and repressive sectors”, and neglects vital sectors “such as education, health, justice and security for Mozambicans”.

Deputy José Samo Gudo claimed that SISE, the Interior Ministry and the Presidency were allotted huge sums, while his colleague Eulalia Oliveira claimed “defence and security have enormous resources to continue the war, to kill, torture and silence those who are against the regime”.

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Even after Minister Maleiane had given the true figure for defence and security spending, Renamo deputies continued with fantastic claims. Carlos Maiela claimed that money was going to the Defence Ministry “to the detriment of agriculture”. The correct figure for the Defence Ministry is MT592-million – spending on agriculture is 30 times that sum.

Antonio Timba claimed that the allocation to the President’s office is twice as large as the allocation to education. In fact, the total allocation to the Presidency is MT1.14-billion, which is only 2.4% of the allocation to education. Minister Maleiane said that the great bulk of the spending in the 2017 Budget is for economic and social sectors – 68.8% of total public expenditure.

This breaks down as follows: education, 23%; health 10.1%; agriculture and rural development, 8.7%; roads, 8.5%; water supply and public works, 7.7%; transport and communication, 4.3%; social welfare and labour, 3.6%; judicial system, 1.5%; mineral resources and energy, 1.4%.


President Nyusi wants Mozambican tourism to revitalise economy

“We have to stop being a country with potential and become a power”, President Filipe Nyusi told tour operators during a discussion of sector revitalisation. “We invite those involved in tourism to exchange views on what we can do to make the country a tourist destination”. According to reports, one of the aspects considered is that Dubai has become a power in world tourism with only 14-kilometres of coast, and other countries

that do not even have beaches also succeed while Mozambique, with more than 2,000-kilometres of coastline, does not. Speaking on Wednesday 7 December, at the event, the Minister of Culture and Tourism, Silva Dunduru, said that of the 141 countries evaluated by the global competitiveness index in 2015, Mozambique ranked 130. And for the President, this scenario “is not positive”.

President Nyusi argued that it was necessary to ask what other countries had to be ranked so far above Mozambique. “We have to stop being a country with potential and become a power. Mozambique as a tourist destination: what is failing, what is to be done, and how to do it?” the President asked. About 30 personalities linked to tourism participated in Wednesday’s event.

Source: O País

Average commodity prices: 30 November to 7 December

During the period 30 November to 7 December, the average prices for basic food products shifted somewhat in shops and markets in the cities of Maputo, Beira and Nampula. In Maputo City, prices remained relatively stable during the period under review. The price of locally produced tomatoes increased (by 23%) due to poor domestic production.

In Beira, price increases were recorded for products such as locally produced tomatoes (40%), locally produced peanuts (29%) and locally produced potatoes (17%) – also due to poor domestic production. In Nampula City, prices for essential commodities remained stable during the period under review.

Source: Jornal Notícias

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Tax Authority to strengthen the fight against smuggling of fuel and drinks

The Mozambican Tax Authority (AT) wants to strengthen the fight against the smuggling of fuel and drinks. The new measures will come into force from 2017. This information was revealed on Friday 2 December by the president of AT, Amelia Nakhare.

With regard to fuels, the AT will implement a process of marking and laboratory identification. Laboratory analysis will allow verification of fuel quality (i.e. if the fuel has all the chemical components or has been tampered with) in order to ensure that the consumer receives a high-quality product.

“The fuel marking process will not only allow reduction of fuel smuggling but will also increase the longevity of the vehicles and the quality of fuel that is used in the domestic market”, said the president of AT. To this end, the AT will soon launch a tender for the selection of the company that will carry out the laboratory analysis.

Nakhare also said that there is an ongoing campaign to seal beverages and tobacco, a measure aimed at reducing the smuggling of these products.

The authorities advance that 60% of products on the market are smuggled and the State loses about 40% of the revenue from the tax on specific consumer goods.

The President of the Tax Authority was speaking during the inauguration of the House of facilities of Customs Brokers of Mozambique (Câmara dos Despachantes Aduaneiros de Moçambique). The building is budgeted at MT14-million.

Source: O País

Government authorises import of basic food products

To meet the shortfall resulting from weak local production and ensure supply during the festive season, the government has authorised the import of basic food products, in particular potatoes, tomatoes, chicken and frozen fish.

Deputy Minister of Industry and Trade, Ragendra de Sousa, says companies for the import of products have already been selected.

Speaking recently at a meeting with economic agents in Nampula Province, Deputy Minister de Sousa said that the government intended to cover the seasonal deficit and ensure the availability of food at affordable prices for all pockets.

Deputy Minister de Sousa said that the selection of firms to import potatoes, tomatoes, chickens and frozen fish was a strategy to end the monopoly of the “mukheristas” (unofficial importers) who – although they ensure availability – raise prices beyond the means of the most disadvantaged.

The selected companies are headquartered in the south, centre and north of the country, where they will be responsible for supplying the local market.

“We call upon the companies to supply wholesalers who can resell to retailers in their areas, stabilizing prices”, Deputy Minister de Sousa said.

At the meeting, at which the government stressed the need to increase the volume of domestic food production, businessmen in Nampula expressed misgivings over the supply of beverages, particularly soft drinks and domestic beer.

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Currently, the market lacks 300-millilitre bottles of soft drinks produced by the plant in Nampula, plus national beer brands in 330-millilitre and 550-millilitre bottles.


INSS recovers over MT1.6-million

The National Institute of Social Security (Instituto Nacional de Segurança Social, INSS) recently recovered approximately MT1.6-million that had been deducted from the salaries of workers and not channelled into the system by some companies. The amount in question had been recovered thanks to awareness-raising efforts by the employers of the labour authorities. In total, 143 taxpayers were liable to the INSS, and it was thus possible to recover the amount mentioned above.

The tracking of debtors, detections of irregularities as well as the speed in registering taxpayers and beneficiaries in the system have been facilitated since the introduction of the Social Security Information Service of Mozambique (Serviço de Informação da Segurança Social de Moçambique, SISSMO), resulting from the computerisation and general modernisation project of the INSS.

Source: Folha de Maputo

National energy potential attracts Chilean investment

Chile intends to establish commercial and investment relations with the Mozambican private sector. The Confederation of Economic Associations of Mozambique (Confederação das Associações Económicas de Moçambique, CTA) recently met in Maputo with a Chilean

delegation which included the South African ambassador to the country, Carlos Parker, and the Director of the Department for Africa of the Chilean Ministry of Foreign Affairs of that country, Constanza Beatriz Alegria Pacull.

At the end of the meeting, CTA deputy chairman Agostinho Vuma said that Chile intended to use the CTA as a platform for Mozambique business partnerships. “During the meeting we also discussed the need for Chile to establish an embassy in Mozambique, instead of a consulate, to allow greater dynamism in relations between the two countries”, said Vuma.

Vuma stated that the meeting was “positive”, and stressed that it was aimed at exchanging information for the establishment of trade and investment relationships. He said that the parties exchanged information on existing business opportunities in both countries, with Chile tabling a package aimed internationalising its companies.

“Political and diplomatic relations are important for trade relations to advance”, said Vuma, adding that Mozambique has arable land and a favourable climate for production, and Chile can lend its experience through partnerships with national businesspeople and producers.

“Chileans are more concerned about participating in gas because they produce on a small scale and have used Guinea as their supplier. They think this area would be a priority, on the one hand as buyers, and on the other, as companies that can bring added value to join us within the local content”, stressed Vuma.

For his part, Ambassador Parker stressed the advantages of business co-operation

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between Mozambique and Chile. “We have information about the gas and other sectors in which Mozambique has potential. We want to open new lines of relationship between the two countries”, said Ambassador Parker.

The Chilean diplomat also announced that his country intends to sign a Memorandum of Understanding (MoU) with the CTA that aims to exchange information on business opportunities and experiences in various sectors.


Italian ambassador wants peace for development

On Wednesday 7 December, the Italian ambassador in Mozambique, Marco Conticelli, emphasised peace as a condition for the development of a better business environment in Mozambique. Speaking during a visit to CTA in Maputo, the Italian diplomat was optimistic that both the government and Renamo aspire to resolve the political impasse, and said that peace is the most important wish of all Mozambicans.

“Italy has an interest in Mozambique. We have a lot of companies that want to invest here”, Ambassador Conticelli. The Italian ambassador also said that in addition to tourism and agriculture, the hydrocarbons sector has been a major concern for Italian businesspeople in Mozambique and pointed to the multinational ENI, which announced that it will go ahead with its investment for the development of the gas production project in Rovuma Basin Area-4.

“Peace and development are two things that go together”, added the ambassador.


UAE want to increase investments in the country

The United Arab Emirates (UAE) has expressed its desire to be one of the major contributors in the process of development of the Mozambican economy through various investments.

According to the UAE ambassador to Mozambique, Asim Al Rahmah, this objective is close to materialising, considering that the UAE is third in terms of the largest volume of direct investment towards Mozambique’s economy.

“As a result of trade, the investments of the UAE in Mozambique reached approximately US$100-million in 2015, ranking third among countries with direct investment”, said the ambassador.

He added that there are ongoing investments in the areas of transport, agriculture and commerce, in addition to projects that are yet to be implemented.

“We are currently working so that the UAE and Etihad Airlines may commence direct flights to Maputo, considering that this city as an entry point for neighbouring countries”, said Ambassador Rahmah.

Representing the Mozambican government was the Minister of Public Works, Housing and Water Resources, Carlos Martinho, who pointed out that Mozambique has partners like the UAE to help it recover from the crisis affecting the economy.

According to the Minister, the economic crisis, which is a reality in the country, has obliged the government to make significant efforts to ensure that the productive sector remains fully operational.

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That is why, according to Minister Martinho, “in this context, the government counts on the support of international co-operation partners, in particular your country (UAE), with a view of boosting and diversifying the economy, enabling development and social welfare in our country”.

It should be noted that the UAE Embassy was recently established in Maputo and Asim Al Rahmah is the first ambassador to Mozambique.

Since then, the mission has contributed to the strengthening of relations between the two countries. Indeed, during this period a number of agreements were signed between the two countries, namely the Agreement on the Promotion and Reciprocal Protection of Investments, an agreement which avoids double income taxation, an agreement in the field of civil aviation, and the Memorandum of Understanding on political consultations.


Presence of Portuguese companies in Africa attracts Chinese companies to privatisations

A presence in Africa is one of the main factors that has attracted Chinese investors to the privatisations of Portuguese companies in recent years, and investment is expected to continue, according to journalists Anabela Campos and Isabel Vicente.

This summary of privatisations, especially during the bailout period that Portugal was subject to between 2011 and 2014 and included some of the largest companies in the country, such as Energias de Portugal (EDP), is included in the book Negócios

da China, recently published by the two journalists in Lisbon.

Speaking to MacauHub, Anabela Campos, a reporter for Portuguese weekly newspaper Expresso, said that Angola and Mozambique were especially interesting markets for Chinese investors and are among the “reasons why they were interested in Portugal”.

“The importance of deepening their presence in Africa, with companies that know the market well, had a great power of attraction for Chinese investors. The fact that there are good companies for sale, the sale prices in some cases, and that China is internationalising its economy did the rest”, she said.

A 2015 study by the Rhodium consultancy – drawn up by law firm Baker & McKenzie, who analysed total transactions between 2004 and 2014 – puts Portugal as the fourth country in Europe to attract most Chinese investment in the last decade, ahead of much larger economies such as in Spain or Italy, for example.

In 2014, it said, total investment by China in Europe amounted to US$18-billion, double the amount in the previous year, with the preferred countries of Chinese investors being the United Kingdom (US$5.1-billion), Italy (US$3.5-billion), the Netherlands (US$2.3-billion) and Portugal (US$2-billion), followed by Germany (US$1.6-billion).

The amount could even have overtaken the country that received most investment if the offer by Anbang for Novo Banco (€4.2-billion) had been approved by the Bank of Portugal.

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These figures are from before investments made later, including in the health sector, by HNA in airline TAP and by Fosun, completed in recent weeks, in Banco Comercial Portugues (BCP), the largest Portuguese private bank, which made the Chinese group the largest shareholder, overtaking Angolan oil company Sonangol.

The journalists observe a pattern between Chinese and Angolan investment in Portugal, as it is present virtually in the same sectors and in some cases the same companies – such as BCP, and also in Global Media. “It’s too early to say that there is some co-ordination between them, particularly in BCP, where Sonangol is, which owns subsidiaries involved in deals with the Chinese”, said Campos.

The journalist also said that Chinese investors, “are in Portugal in a different way to any country in the West, not only because of the diversity of sectors in which they have entered, but also the fact that two Chinese state-owned enterprises now have control of the Portuguese electricity sector, in EDP and power grid company REN”. Information gathered by the journalists while researching the book showed that state-owned China Petroleum & Chemical Corporation (Sinopec) is likely to become a shareholder of Galp Energia, with which it is a business partner in Brazil.

As a result of research and interviews of some of the key politicians and managers of the country, the book by the Expresso journalists also addresses investment from other sources, including Angola and France, which they consider “an economic revolution” in Portugal.

Source: MacauHub

Financial Services:

Banco de Moçambique says national banks should capitalise to participate in natural gas projects

Mozambique’s central bank says national banks should increase their capitalisation so they can participate in the financing of natural gas projects, noting that the involvement of the national financial system in energy resources would be a bonus for the country.

Speaking at the Mozambique Gas Summit, an international conference on natural gas that ended on Friday 2 December in Maputo, Banco de Moçambique administrator Joana Matsombe pointed out that, so far, Mozambican financial institutions have participated in only about 16% of investments associated with natural gas research, more than 80% of which have been financed from overseas.

“National banking must be capitalised to take a larger share of the financing of investment in energy resources. Such involvement would boost the national financial system and broaden its returns”, she said. Due to its small size, the Mozambican financial system was participating only marginally in natural resource projects. “There are some small things that national banks have financed in relation to gas industry mega-projects”, Matsombe said noted.

With investments of more than US$7-billion in natural gas exploration, multinationals in the industry have resorted to foreign banks and shareholder resources for financing, she added.

Source: Lusa

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Banco de Moçambique nominates committee for Moza bank

The Banco de Moçambique will appoint a committee to lead the process of capitalisation or sale of troubled bank Moza as soon as the report that was commissioned from KPMG is delivered, the central bank said in a statement issued on Tuesday 6 November, in Maputo.

The committee will be responsible for analysing the diagnostic report and independent review of the financial statements of Moza, as at 30 September 2016, prepared by KPMG in collaboration with the Financial Department of the bank, which will then be sent to shareholders.

This analysis is intended to help shareholders to decide on a possible procedure for the capitalisation or sale of Moza, during a general meeting which will be accompanied by the evaluation committee for later implementation of the decision.

The committee will consist of a chairman, who is the current chairman of the interim board of Moza, João Figueiredo, and two members, including a director of the Banco de Moçambique and a representative of the International Finance Corporation, of the World Bank group.

Moza, formerly known as Moza Banco, was intervened upon at the beginning of October by the Banco de Moçambique to secure the interests of depositors, as the bank’s solvency ratio was below zero.

The central bank also said it had decided to suspend the members of the board of directors and the executive committee of the bank and appointed a provisional

board, led by Figueiredo, whose term will last until the situation is normalised.

Moza, which started operations in 2008, is 51% controlled by Moçambique Capitais and the remaining 49% is held by Novo Banco, the bank that kept the healthy assets of the bankrupt Banco Espírito Santo (BES).

Source: MacauHub

World Bank involvement in Moza Banco recapitalisation for “transparency”

A representative of the World Bank is to be appointed to the Evaluation Commission that will lead the Moza Banco recapitalisation and sale process.

Just over two months after Mozambique’s central bank intervened in Moza Banco SA as a result of the unsustainability of its financial situation, the Mozambican Banking Regulatory Institution announced on Monday 5 December that it would shortly appoint an evaluation committee to lead the bank’s recapitalisation and sale process following the finalisation of the KPMG report.

The committee, to be chaired by João Figeuiredo, will evaluate the report “to be prepared by KPMG and the Moza Banco Financial Directorate for subsequent referral to the shareholders, enabling them to make a decision on the capital increase to be decided by the General Meeting; and monitor the results of the General Assembly vote and promote their execution”, the Banco de Moçambique statement said.

In addition to Figueredo, the evaluation committee will be composed of another member, who will be a Banco de

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Moçambique administrator, and a third member who will be a representative of the World Bank’s private sector investment arm, the International Finance Corporation (IFC).

In response to a question from @Verdade, Alberto Bila, administrator of the Legal, Regulatory, Licensing and Human Resources area of the Banco de Moçambique, clarified the presence of the representative of the Bretton Woods institution. “We found in this institution [Bretton Woods] someone who could bring about the heightened transparency which is desirable in these processes. This was the main reason”.

Source: @Verdade

Director of Deloitte & Touche (Mozambique) heads up liquidation committee of O Nosso Banco

The Director of the Deloitte & Touche consulting company (Mozambique), João Machado, was named by the Banco de Moçambique as chairman of the liquidation committee of former bank O Nosso Banco, according to a statement issued in Maputo by the Mozambican central bank.

The statement said that the committee will consist of three people, a chairman, a member representing the creditors and another on behalf of shareholders.

The committee’s main mission will be to determine assets and liabilities so that after selling the assets they can pay off creditors, probably on a prorated basis.

Through an order issued on 11 November by the governor of the Banco de Moçambique, Nosso Banco was dissolved due to deterioration in the financial

situation of the institution, affecting the main prudential and profitability indicators.

O Nosso Banco was founded in 1999 as Banco Mercantil e de Investimentos (BMI), and changed its name in 2015.

Although it is a private entity, the majority of the capital belongs to the National Institute of Social Security (77%), and also shareholders of public company EdM (15%) and SPI – Gestão de Investimentos, a company linked to top figures of ruling Frelimo.

Source: MacauHub

Oil & Gas:

Government approves key Mozambique LNG agreements

On Tuesday 6 December, Mozambique’s Cabinet approved five key decrees to push forward the two Rovuma Basin LNG projects planned in the far north of the country.

The decrees by the Cabinet update the exploration and production concession contracts (EPCCs) awarded a decade ago for the two blocks – Area-1, now operated by Anadarko, and Area-4, now operated by ENI.

The original EPCCs were drafted assuming oil would be found, and the contracts have now been updated to promote gas and LNG development.

Another decree allows the companies in the Area-1 consortium to market LNG from Anadarko’s planned 12 mtpa Mozambique LNG plant as a single unit, rather than sell their portions of the output independently.

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The government has also confirmed that it wants the Anadarko-led consortium to pay the Petroleum Production Tax, set at 6% for gas, in cash rather than in kind – allowing all the LNG produced by the plant to be sold on the international market.

However, at least 2.8-million cubic metres per day of gas from the Golfinho-Atum field will initially be earmarked for the domestic market, according to a Memorandum of Understanding (MoU) signed last year between Anadarko and the government.

Mozambique’s petroleum regulator, the INP, used this as the basis to launch a domestic gas project tender in September 2016. The winning bidders are to be announced on 17 December.

The agreements approved “will allow conditions to be created to obtain financing and implement the Golfinho and Atum LNG project of Anadarko, and ENI’s Coral South project”, Ana Comuana, the deputy minister of culture and tourism, said as government spokesperson on Tuesday.

Deputy Minister Comuana said the Council of Ministers also heard about how state oil and gas company ENH plans to finance its stake in the projects.

ENH Chairman Omar Mithá told Interfax Natural Gas Daily in May that the company will be ‘carried’ by its consortium partners, who will lend it money to invest in the projects. ENH will repay them from its share of the profits from LNG sales.

Speaking at the Financial Times Mozambique Summit on 2 November, Mithá said he expects the consortium partners to lend at rates lower than those

currently prevailing for Mozambique’s sovereign debt.

Mozambique passed its LNG decree law – which provides the basis for negotiating all key legal and contractual agreements for the Rovuma Basin gas projects – in December 2014.

Since then, Anadarko has reached an agreement on the unitisation of the Mamba-Prosperidade field, which straddles Area-1 and Area-4, and signed an MoU for the domestic market offtake.

The company has now also received approval from the government for the majority of the agreements under the legal and contractual framework for the LNG project.

A number of other agreements “are working their way through government” and some have already been approved at the ministerial level, John Bretz, Anadarko’s country manager in Mozambique, told Interfax Natural Gas Daily last Friday.

However, he declined to comment on what those agreements are.

Legal progress:

Bretz said he hopes to have the remaining legal and contractual agreements “fully approved and completed very soon” – ideally before the end of the year.

That would then pave the way for converting the heads of agreements (HOAs) for LNG sales into binding sales-and-purchase agreements, which would allow Anadarko to close the bank financing for the project and reach an FID, he said.

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Anadarko has signed HOAs with buyers in Asia for eight mt of the project’s 12 mtpa of output, and is seeking new buyers in emerging markets for the remainder – although it will leave some to sell on the spot market.

Mithá estimates an FID on the project will be made in the fourth quarter of 2017, but Bretz declined to put a timeframe on how long it would take.

Other issues, such as how the marine concession and joint facilities around the Rovuma projects will be managed, are still being negotiated.

“We’re working well with the government and [the] Area-4 [consortium] to finalise those”, Bretz said.

Assif Mussa, Anadarko’s government affairs and communications manager, partly blames the delay in moving the agreements forward on the change of government, which happened shortly after the decree law was published.

Filipe Nyusi won Mozambique’s presidential election in October 2014 and appointed a new government in January 2015, assigning Pedro Couto to the post of minister of mineral resources and energy.

Bretz dismissed concerns the process is likely to slow down again following President Nyusi’s decision in October to replace Couto with Leticia Deusina da Silva Klemens, a businesswoman who has no experience working in energy or in government.

“From everything we know, she’s a quick learner. The government has placed a lot of trust in her, and we’re working well with her”, he said.

Minister Klemens announced last week that the government had already made further progress on the project by approving the resettlement action plan (RAP) for the 2,000 people that will be displaced when Anadarko starts clearing land for the LNG facility.

Anadarko submitted the RAP in late June for the 471 households affected by the move, and it had expected approval by September.

However, Interfax Natural Gas Daily understands Minister Klemens’ announcement may have been premature.

Even if the plan has been approved by the local district of Palma and the Ministry of Land, Environment and Rural Development – and some sources suggest this is not yet the case – it has still not been formally sanctioned by the country’s Council of Ministers.

While Bretz and his team are ironing out agreements on the ground in Mozambique, the project finance team are working to secure lenders for the US$20-billion plant.

Raising the debt for the project was always going to be a major challenge in a frontier market, but today’s environment – with oil prices and LNG demand still low – is especially tough.

Mozambique is effectively bankrupt after the government guaranteed US$2-billion in debt to three quasi-state-owned maritime security companies – Ematum, Proindicus and MAM – that it cannot now pay back, which has made lenders even more cautious.

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Credit support:

The Mozambique LNG project will lean heavily on support from export credit agencies (ECAs) for financing. These agencies, as well as commercial banks, will watch closely to see how talks progress between the government and the IMF – which suspended lending to Mozambique following the debt revelations – before committing to the project.

“In general, the ECAs are quite a conservative bunch, but things are going in the right direction in terms of the IMF ultimately resuming [financing]”, Katan Hirachand, managing director of energy advisory and project finance for Société Générale, Mozambique LNG’s financial adviser, told the CWC Mozambique Gas Summit last week.

The financing of ENI’s Coral South FLNG project will provide some indication of attitudes towards Anadarko’s Mozambique LNG development, he noted.

The Italian oil major, which has signed a binding sales-and-purchase agreement to sell the full 3.4 mtpa of the project’s output to UK oil major BP, is now evaluating the first commercial bank offers and hopes to tie up the financing within the next few months.

ENI is looking for around US$4-billion from project finance banks for its US$5-billion to US$6-billion FLNG vessel. Banks will also be lending under the cover of guarantees from ECAs, including China Exim, Korea Exim, Italy’s SACE and France’s Coface. The upstream portion of the project will be financed by the Area-4 consortium on balance sheet.

“[The Coral South project] is moving ahead, despite the fact the [IMF] programme hasn’t resumed”, Hirachand told delegates. “So it is on a case-by-case [basis], but in general they will want to see the country moving in the right direction, which it appears to be. And I think on that basis they’ll provide their support. They take a very long term view, of course”, he added.

A team from the IMF arrived in Maputo at the end of November and will remain on the ground until Q1 2017 to discuss resuming lending to Mozambique.

One of the conditions for the talks to restart was that Mozambique agree to an independent audit into the three controversial deals that were taken out in 2013-14.

International forensic audit firm Kroll is now conducting the investigation. The firm has 90 days to complete the audit, which will later be made public.

As well as aiming to close the Coral South financing by early 2017, ENI is also in the process of finalising a deal for ExxonMobil to buy 50% of its stake in Area-4.

The US supermajor has already taken a bet on Mozambique after winning three offshore blocks (A5-B, Z5-C and Z5-D) in the country’s fifth licensing round last year.

However, Mozambique’s government would welcome the company’s involvement in the Rovuma Basin gas projects as well.

“We would see that as positive because Exxon is very much experienced. They’ve done this in the past [...] they’ve got a very strong balance sheet, liquidity as well, and

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they would act as a magnet [...] for foreign direct investment”, Mithá previously told Interfax Natural Gas Daily.

Anadarko has dismissed speculation it is in similar negotiations with Exxon to buy its stake in Area-1. “Anadarko is committed to long-term involvement in the development of energy resources within Mozambique – we have built an experienced and capable team to ensure the delivery of a successful project”, a spokesman confirmed to Interfax Natural Gas Daily last Friday. However, industry observers have noted Anadarko’s lack of LNG experience and limited liquidity could mean it will struggle to pull off a project of this scale in a country such as Mozambique.

Source: Interfax Natural Gas Daily

“Resource exploration must benefit the country” – Minister Klemens

On Thursday 1 December, the Minister of Mineral Resources and Energy, Leticia da Silva Deusina Klemens, challenged the different sectors under her ministry to ensure that the exploitation of natural resources remains beneficial to the country now and in the future.

The Minister issued this challenge in Maputo, at the opening of the II Co-ordinating Council of the Ministry of Mineral Resources and Energy, held under the motto ‘Mineral Resources and Energy Boosting the Industrialisation of the Country’. To this end, according to the Minister, sector staff should overcome the critical factors that impede the realisation of this objective.

These obstacles include: enlisting the training of national cadres and skilled labour, the development of infrastructure

and strengthening of national business. “This platform is an opportunity for sharing experiences and knowledge in order to accelerate the steps to achieve our goals to ensure the exploitation of resources that benefits the country in a sustainable way”, said Minister Klemens. The two-day meeting was aimed at evaluating compliance with the previous Council recommendations.


Anadarko issues Expression of Interest

Anadarko Moçambique Área 1, Lda. invites interested companies to submit Expressions of Interest for the provision of the following services:

Plant and Equipment hire with operators for AMA1 operations in Afungi Area, in Cabo Delgado Province.

Interested companies must submit EoI together with the following documentation:

Updated Articles of Association (as published in the Official Gazette)

Updated Certificate of Commercial Registration issued less than 90 days ago

Updated Operational License or equivalent documents issued by the relevant authorities

Forms of Tax registration and commencement of activity statement

Company profile

Detailed description of services to be offered

Portfolio of projects rendered

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List of available equipment in Mozambique.

Additionally, if the EoI is submitted by a consortium, it must be accompanied by the joint venture agreement which must define the terms and conditions of the consortium, the period of its duration and the form of participation of the members of the consortium.

The EoI with the subject: “Plant and Equipment Hire” must be submitted to Anadarko Moçambique Área 1, Lda., at the email address below, no later than 17:00hrs on 19 December 2016 to the following email address: [email protected]

Source: Anadarko/Club of Mozambique

Mozambican political parties unable to formulate policies on natural resources – NGO

Mozambican political parties lack the preparation to formulate policies for the extractive industry, a deficiency that could undermine the defence of the country’s interests, the Executive Director of the Institute for Multiparty Democracy (IDM) said on Tuesday 6 December.

Speaking to Lusa on the side-lines of the ‘Participation of Political Parties and Parliament in the Development of the Extractive Industry’ conference, the IDM’s Hermenegildo Munjovo said that the insufficient capacity of Mozambican political institutions in the debate on the extractive industry was resulting in the importation of other countries’ policies and laws of that were not adapted to the Mozambican reality. “I must say that [the preparation of political institutions] is still very poor, and we feel that political parties and parliament can do even more”, the

executive director of IDM – a Mozambican non-governmental organisation – said.

The National Assembly, Munjovo continued, should be able to exercise its role both as legislator and inspector competently in order to ensure that natural resources were used for the well-being of all Mozambicans. “The extractive industry sector has grown considerably in recent years, and so have expectations over what their contribution to the country’s development should be”, he added.

Eduardo Alexandre, an adviser to the Ministry of Mineral Resources and Energy, pointed to the capacity building of institutions as one of the challenges in the management of natural resources in the country, noting that the country was still at an embryonic stage in the matter.

“We still do not have the necessary experience in the management of natural resources. We still face the challenge of building our natural resources, to create internal capacity”, he said. A comprehensive geological assessment of Mozambique’s full potential in natural resources is also another challenge facing the country, he added.

Source: Lusa

Fuel shortages in Beira

The city of Beira is facing fuel shortages, with petrol stations on the verge of closing down. A survey of stations carried out by Diário de Moçambique reveals that petrol is running low at almost all stations.

The Galp station, at the corner of Avenida Armando Tivane and 24 de Julho, near the roundabout in Chipangara, has not had a delivery of gas or diesel for three


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days, and traffic cones have been laid out to indicate that the tanks are empty.

According to the manager, Brayton Joseph, the delay in the delivery of the fuel is due to the bureaucratic processes in the Port of Beira, and is costing his station MT18,000 to MT20,000 per day.

“We sell almost 6,000-litres of fuel per day. So we are losing MT18,000 to MT20,000 (US$244-271) a day. The problem lies in the port, where there are hold-ups. We have already placed the order, but we’re still waiting. They said they were going to deliver, but they have internal problems. Previously we put in a requisition and got the fuel in 48 hours maximum”, he explained.

Diário de Moçambique was unable to obtain a comment from the port managers.

Source: Folha de Maputo/Diário de Moçambique

Mining:

A look at Vale SA’s focus in Its coal division

Vale SA’s coal production for the third quarter 2016 (3Q16) rose 54.0% quarter-over-quarter to reach 2.3-million tons. The rise was mainly due to the ramp-up of the Moatize II plant (Mozambique) after its start up in August 2016.

Vale’s Carborough Downs coal mine (Australia) has also started operations after facing operational challenges in 2Q16.

While production of metallurgical coal was 32.0% higher QoQ, thermal coal production rose 56.0% QoQ.

Profitability has risen:

Vale’s adjusted EBITDA (earnings before interest, tax, depreciation, and amortisation) was -US$7.0-million in 3Q16 compared to -US$110.0-million in 2Q16.

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It’s worth noting that this is despite the fact that the recent spike in coal prices isn’t fully reflected in the index prices due to Vale’s lagging pricing systems.

Vale’s realised price of US$91 per ton is significantly lower than the index price average of US$135.60 per ton. That should lead to a considerable improvement in Vale’s realised prices in 4Q16.

Focus on costs continues:

During Vale’s 2Q16 earnings call, the company maintained its focus on reducing costs, increasing profitability, and ramping up Nacala.

During 3Q16, the focus was quite visible as the production cost per ton at the Nacala port continued to improve at US$87 per ton in 3Q16. That figure was 16.0% less than 2Q16. The company expects further improvement in the coming quarters due to the ramp-up of Nacala.

Increased supply and weak demand have caused many US coal companies (QQQ) to file for bankruptcy in 2015. The scenario has changed in 2016 on the back of a strong Chinese demand and tight global supply. Strong Chinese demand is also supporting thermal coal prices.

Higher coal prices in 2016 are allowing coal producers (KOL) such as Alliance Resource Partners (ARLP), Arch Coal (ACIIQ), Peabody Energy (BTUUQ), and Cloud Peak Energy (CLD) to reap the benefits. Cloud Peak Energy forms 3.0% of the SPDR Metals and Mining ETF (XME).

Source: Market Realist

Triton debuts new look, renews focus on Mozambique project

A new look Triton Minerals has emerged from administration, resuming share trading on the ASX and sprouting a renewed focus on the rapid development potential of its Ancuabe graphite project in Mozambique. Triton in March went into voluntary administration, shortly after announcing plans to become a graphite concentrate producer within a 12-month timeframe.

The administrators were appointed to assist Triton in reviewing its operations and financial position, and to formulate potential strategies to preserve and restructure the company and its operations. On Tuesday 6 December, Triton emerged with a new board and management, with the company telling shareholders that following the voluntary administration process, the company has now turned its focus to the evaluation and development of Ancuabe, and supply into the high-value end of the graphite supply market.

Ancuabe is located in a region with historical high quality graphite production with the former Kenmare graphite facility being refurbished by AMG/GK with whom Triton has a strategic alliance. Importantly the project is in close proximity to Pemba Port and grid power, and is isolated from local communities.

The maiden JORC Inferred Resource for the Ancuabe T12 deposit was outlined earlier in the year, and comprises of 14.9-million tons at 5.4% total graphitic carbon (TGC) for 798,000-tons of contained graphite. This has strong potential to grow, considering less than 30% of the prospective strike length has been tested. “We are now excellently positioned with

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strong cash levels of approximately A$8-million at bank, a supportive substantial shareholder in Shandong Tianye Mining, which is the nominee company of Minjar Gold, and a very attractive project opportunity that we believe can deliver significant value to all shareholders”, said Triton’s new managing director, Peter Canterbury.

He pointed out that the global graphite industry was currently going through a period of high growth, underpinned by the rapidly developing battery market. “Preliminary test work at Ancuabe has indicated that approximately 50% of the flake size distribution fits in the extra-large or jumbo flake size category, which could allow us to market into the niche and high-value end of the market”, Canterbury said.

During the voluntary administration process, Triton launched a 3,000-metre diamond and 1,800-metre reverse circulation drilling programme, and results from the drilling was expected over the coming three months. Triton will have circa 658-million shares on issue, with 73-million unlisted options and 22-million listed options. If the stock opens at around seven US cents a share, this would put the market valuation in the US$45-million range.

Source: Creamer Media’s Mining Weekly/ProActive Investors

Kenmare launches tender for camp services in Nampula

Kenmare Moma Titanium Minerals has launched a tender to contract a company for the provision of camp services in Nampula Province. The services cover: Catering, cleaning, and other ad hoc activities.

Pre-qualification closes on 3 January 2017.

To access the full tender, with all the details and information regarding the application process, please visit Club of Mozambique’s section, through the following link:

www.clubofmozambique.com

Source: Club of Mozambique

Odebrecht implements a rigid Programme of Compliance

The Odebrecht Group reaffirmed its commitment to ethics, integrity and transparent business practices in all its dealings.

This represents a significant step for the improvement and continuity of its operations worldwide, highlighting for its clients, partners, members and communities the level of maturation of its compliance programme, as one of the reflects of this new moment of the Group.

Odebrecht emphasises that it has been implementing all internal and external control mechanisms to prevent and mitigate the risk of any deviations, starting with its strict compliance programme applicable to all the group’s businesses, in all countries where it is present.

In the engineering business arm, through Odebrecht Engineering and Construction (OEC), a senior executive Mike Munro, hired to lead and implement the programme, is conducting this task. Munro responds to the new Compliance Committee that serves the OEC’s Board of Directors, which is composed by independent directors.

http://clubofmozambique.com/business/tenders/

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These improvements occur as a result of the revision of the internal processes conducted by top international consulting, auditing and law firms in order to make the compliance programme fully compliant with international best practices and standards, reinforcing the processes of risk monitoring, compliance of laws and regulations, as well as the improvement of internal policies of the Organisation.

It should be noted that in a recent survey by the NGO International Transparency, entitled ‘Transparency in Corporate Reports: Evaluating Emerging Market Multinationals’, the Odebrecht Group rose 47 positions in the ranking of best information disclosure practices. The information dissemination practices of 100 largest multinationals from 15 emerging countries that operate in more than 185 countries around the world have been evaluated.

Recently, the Group’s holding company, Odebrecht S.A., adhered to the United Nations Global Pact, which means that Odebrecht will fully assume and comply with all the 10 principles of the pact, reinforcing respect for the moral and physical dignity of the human being, environment and the fight against corruption.

Other initiatives have also been implemented, such as participation in the Pro Ethics, a programme of the Brazilian Office of the Controller General, which results from a combination of efforts between the public and private sectors to encourage the adoption of integrity measures by companies, making them increasingly committed to prevent and combat corruption and other types of frauds.

Félix Martins, managing director of Odebrecht Mozambique, stated that: “this new compliance programme is an important tool capable to identify, monitor and mitigate exposures to non-compliance risks, ensuring compliance with international best governance practices in markets and countries where Odebrecht operates, in accordance with the Group’s internal policies and the laws of those countries, which the company and its members must observe and comply with”.

With these measures, the Odebrecht Group also demonstrates the solid commitment of all its employees with an ethical, integrity and transparent conduct.

“Odebrecht reinforces the importance to the Group of its projects and investments in Mozambique and its full commitment to its clients and the sustainable growth of the country”. said Martins.

Source: Odebrecht Mozambique

Former minister Abreu’s clan tightens hold on mines

In early November the Grupo Videre – a firm owned by the family of former Mozambique foreign minister Alcinda Abreu – acquired 50% of a new company that aims to explore for precious and semi-precious gems.

The new company, Ovahana Minerais, will be run by the former minister’s son, Chivambo Mamadhusen, the managing director of Grupo Videre. The remaining stake in Ovahana Minerais is owned by Fernando Saíde, an executive in the Mozambican subsidiary of the Portuguese construction firm Elevo Group.

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Established in 2011, Grupo Videre is already highly active in the mining sector, and often partners with Chinese companies.

Its affiliate, South Orient, explores for precious stones alongside Orient Africa Resources Co., and plans to shortly begin prospecting for gold in conjunction with the equity fund Daohuaxing.

Its other units, Black Rock Mining Co. and Maputo Mining own gold exploration concessions, also in partnerships with Chinese firms, particularly Hong Kong Golden Jewellery.

Elsewhere, the group owns Consolidated Mining Services, a mining industry services firm. The owner of most of the Chinese firms working with Grupo Videre, Lingbin Kong, is also picking up new assets in Mozambique’s mining branch.

In late October, his firm Black Rock incorporated an exploration firm, Mozambique Eldorado Mining Co., in Maputo. Kong is particularly close to another son of Abreu, Dingane Abreu Mamadhusen, who’s also operations manager at Grupo Videre.

Source: Africa Intelligence

Nuno Uinge, the Abreu family’s favourite partner

Businessman Nuno Sidonio Uinge has once again teamed up with Grupo Videre, a company owned by former minister and Frelimo member Alcinda Abreu and his two sons Dingane Abreu Mamadhusen and Chivambo Mamadhusen.

In Maputo in November they founded EFEMM, a firm specialising in the manufacture of metal structures. Uinge and the Abreu family have worked

together since 2009 in LAP/Ubuntu, alongside Libyan shareholders. Nuno Uinge, who heads Energy Works, a consultancy, also has several over influential associates, including relatives of former ministers Carlos Mesquita, Octavio Filiano Mutemba and Cadmiel Mutemba.


Transport & Construction:

China Road and Bridge Corporation builds bridge in Mozambique

The opening of the Macaneta Bridge, which connects the Marracuene district and the town Macaneta by road, is expected to boost the development of the local tourism sector, with its white sand beaches and crystal clear water, according to the Mozambican press.

So far the only way to cross the Umbelúzi River was using small boats or barges, but although the river crossing took just 10 minutes waiting time for a place was three or four hours and the stopped closed at 18:00hrs every day.

The region currently has 17 resorts, high quality beaches for recreation and water sports, a great variety of flora and fauna and a population of about 5,000 people making a living from agriculture and fishing.

Work on the bridge, which was built by the China Road and Bridge Corporation (CRBC), which is part of the Maputo Ring Road, began on 15 January 2015 and cost US$15-million. The bridge is 300-metres long and 11-metres wide and accepts vehicles up to 50-tons.

Source: MacauHub

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Dredging in the Port of Maputo allows it to receive larger ships

More than 90% of the dredging work required to increase the capacity of the Port of Maputo has already been completed. The port will be able to receive vessels of greater tonnage by mid-January 2017, executive director Osório Lucas of the MPDC port management company says.

The first test took place on 1 December when the MV Mineral Belgium, a 160,000-ton ship, carrying 90,000-tons of cargo set off from Maputo for China – a feat that was made possible because of the deepening of the access channel from 11-metres to 14.2-metres at high tide.

Prior to the dredging, ships entering or leaving the port could carry only 60,000 to 70,000-tons of cargo.

Dredging of the Maputo port channel began in May this year (2016) and is scheduled for completion in January 2017. It is being carried out by Jan de Nul Dredging Middle East FZE, an international company that was awarded the project and is using three dredgers to complete it.

“Our expectation is that the dredging will be completed by mid-January 2017, against initial dates of late May, then February. The works is going ahead at top speed, so much so that we have already received the first increased tonnage ship”, Lucas says.

“The entire loading operation was based on mobile cranes, which were part of the investments made by MPDC in equipment that have increased productivity and also improved the competitiveness of the port, as the navigation lines can charter lower

cost ships without cranes” the statement said.

The statement said that, along with dredging the channel, the Port of Maputo has recently started providing bunkering services to all vessels berthed or in the anchorage zone. The service is offered based an agreement between the MPDC and Petromoc Bunkering and is part of a number of schemes to improve the services offered by the port, making it more competitive in regional and international markets.

The port of Maputo was handed over under concession by the government of Mozambique to MPDC in 2003 but gained new momentum in 2008 when South African group Grindrod and DP World, of the United Arab Emirates, acquired a majority stake in Portus Indico, the largest shareholder (51%) and sponsor of the project.

Source: MacauHub/O País

Security deal boosts coal transportation

Security measures implemented earlier this month on the Sena Railway Line in Mozambique have allowed Brazilian mining giant Vale to resume coal transport. The country’s state-owned transport utility Empresa Portos e Caminhos de Ferro de Moçambique (CFM) took responsibility for ensuring security on the line, after a string of attacks by Renamo forces.

Renamo assaults in northern and central Mozambique over the past two years have forced tens of thousands of people to flee their homes, and caused the shutdown of some transport links. Trucks travelling along the north-south highway

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have had to travel in convoys with military escorts this year, and even then, there have been some attacks.

Yet the scale of the impact on Mozambique’s nascent coal industry was only recently observed when the government confirmed that coal trains did not run on the Sena line between the end of July and mid-November because of fears of Renamo violence. Attacks on trains in May and June had resulted in temporary stoppages but after another assault in Sofala Province in July left several railway employees injured, operations on the line were suspended for several months.

The nature of the new security measures has not been revealed, partly in order to avoid giving information to potential assailants, but it is likely that armed guards have been put on the trains and patrols stepped up along the route of the line, particularly in Tsangano district.

Rising coal production:

The Sena Line is one of three railways that are being developed to transport coal from the Moatize Basin (Tete Province) to the Indian Ocean coastal ports of Beira and Nacala. It runs to Beira and handled 22 trains a day in each direction prior to the July attack.

The government hopes that the three lines will jointly carry 100-million tons of coal a year, which would enable Mozambique to overtake South Africa as Africa’s biggest coal exporter. Recent improvements on the Sena Railway have increased its annual coal carrying capacity from 6.5-million tons a year to 20-million tons a year.

Much longer trains can now operate on the line, with six locomotives pulling 100 coal waggons. At the same time, Vale is pressing ahead with doubling its mining capacity in Tete to 22-million tons a year. It had looked like such investment could be misplaced because coal prices crashed in 2015 but they have recovered strongly this year.

Similar measures may have to be put in place on the new line that runs from Moatize to Nacala, which passes through Malawi. The construction of this line has been largely financed by Vale. Coal trains bound for Nacala were assaulted at least twice in October.

Transport connections in this part of Mozambique are very limited and so it is relatively easy for Renamo fighters to attack trains and then melt away into the forest. It is hoped that access to the new railways for general cargo will boost wider economic development in the region. Nacala, which is reputed to have the deepest natural harbour on the east coast of Africa, now hosts a modern container terminal.

Historical conflict:

Renamo fought a long and devastating civil war against the government from independence in 1975 until 1992, backed by white supremacist governments in Zimbabwe and South Africa. The movement has contested every national election since then but has become disenchanted with its lack of success. The likelihood of substantial coal and gas income for the government may have encouraged its leaders to make a grab for power.

Source: African Business Magazine/Neil Ford

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Zambia seal railway construction deal connecting to Port of Nacala

On Wednesday 7 December, Zambia signed a deal for the construction of a new railway project with China’s state-run firm that will enhance transportation in the southern African nation.

The 388-kilometer railway, to run from the eastern town of Chipata to the central town of Serenje via another eastern town of Petauke, will be constructed by China Civil Engineering Construction Company (CCECC), at a cost of US$2.3-billion within a four-year period.

“This project aims at enhancing regional trade and transport competitiveness by providing an alternative trade route to the East Coast of Africa via the Port of Nacala in Mozambique”, Minister of Transport and Communications Brian Mushimba said at a signing ceremony in Lusaka.

The project will provide the much-needed link between the Zambian main railway line network with the Malawian railway line network through the existing Chipata-Mchinji railway line which forms part of the Nacala Corridor, Mushimba said.

The project will enable the government to save funds used on rehabilitation of damaged roads due to haulage of bulk and heavy cargo.

The project, he added, is meant to enhance regional and international trade through the Nacala Development Corridor which involves Zambia, Malawi and Mozambique.

According to him, the project is one of the strategic infrastructure projects the government intends to implement through the China-Africa Co-operation framework

announced by the Chinese government during the 2015 Forum on China-Africa Co-operation (FOCAC) held in South Africa where US$60-billion fund was pledged.

He further expressed confidence in the Chinese firm’s ability to construct the railway within the stipulated period because it has wealth of experience in undertaking railway construction projects.

For his part, the Chinese Ambassador to Zambia, Yang Youming, said the signing and implementation of the project will further promote bilateral co-operation between the two countries.

The railway line, Ambassador Yang said, will promote Zambia’s trade, investment, employment and sustainable development and open another route to the sea for the landlocked southern African nation.

“I believe it will be an important part of the integrated southern African transportation system which connects Zambia with Tanzania, the Democratic Republic of Congo, Malawi and Mozambique”, he added.

Source: Coastweek

Completion of work on two hydro plants in Mozambique postponed to January 2017

The completion of rehabilitation work on the Chicamba and Mavuzi hydropower plants in the central province of Manica, has been postponed until January 2017 because of problems with some of the equipment.

The Deputy Director of Electrification and Projects of EdM, Abraão Rafael, told Diário de Moçambique that the delay was

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due to a fault in the transformer turbines in the Chibata substation.

Rafael said that of the seven generators that were covered by this project five have been recovered and are going to work perfectly when everything is finished, producing 20 megawatts (MW) of electricity.

The rehabilitation work on the two power plants began in November 2013 and is being carried out by French and Norwegian consortium Cedelec and Hidrokarst Rain Power, respectively, and cost US$120-million. The Mavuzi dam was built in the 1950s and the Chicamba dam was built 10 years later. The installed generator units were obsolete because of their age.

Source: MacauHub/Diário de Moçambique

Ambassador Aviation increases competition in Mozambique

Air transport of people and goods should be easier and more competitive as of Monday 5 December, especially in the north of the country, with the entry into service of the first of the two 15-seater C9-MAFaircraft owned by Ambassador Aviation.

The Mozambican airline was established in 1999 and launched services in Nampula in March 2015, with the focus on tourist sites.

Initially the company will operate flights to Nampula, Cabo Delgado and Niassa, reaching destinations with difficult land access and where the runways are short.

Enthusiasm:

Residents in Nampula are enthusiastic because they believe the airline will

increase competition and improve air services, until now the monopoly of public company LAM.

Ortigo Marcos is one of the optimists who would like to see the new airline not only make a profit, but also provide better service to the population. “This company will allow us to get to places LAM does not serve”, he said.

Elisa Rodrigues, also interviewed by Deutsche Welle Africa, believes that the company will “make travelling flexible”, as well as reaching more remote places and communities. However, she cautions the companies not to peg prices beyond the reach of the average consumer.

Other companies:

Another company, Air Corridor, previously operated in the north-centre region, but succumbed to financial difficulties. Rodrigues hopes the new company will be more permanent. “We were used to Air Corridor, but they did not last. I hope this company is here to stay”, she said.

Ambassador Aviation administrator Dinis Cardoso say the company will serve communities in Nampula Province, including businesses, government and non-governmental organisations, transporting goods and people to places that are difficult to reach by land and where aircraft do not usually land.

“These aircraft can land on very short runways”, Cardoso says. He has already marketed low-cost flights to Churches and organisations working in remote communities. “We want to keep this way of thinking, but without ignoring the profit that will help us grow”, he added.

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Nampula governor, Victor Borges, presided over the inauguration and said that the company could play an important role in the growth of the tourism sector in the province and the country, as well as improving the transportation of people and goods. “The provincial government is happy to support this company going forward”, he said.

Source: Deutsche Welle

Embraer/LAM scandal

Teodoro Waty, a former chairperson of LAM, has said that he did not notice any irregularities in the management of the company when he took over from José Viegas in 2011. Viegas has been implicated in the scandal of an US$800,000 bribe paid to LAM by the Brazilian aircraft manufacturer Embraer in 2009.

Asked by the independent television station STV for his reaction to the scandal, Waty said “Newspapers are not courts, I have no proof that what is said is true. I trust my predecessor. When I was there, I saw no signs of what has been reported”. Waty seems unaware that the source of the accusation against Viegas is not any media report, but a document signed by Brazilian federal prosecutors and by officials from Embraer itself.

Embraer was accused of bribing officials, not only in Mozambique, but also in India, Saudi Arabia and the Dominican Republic. It reached a settlement both in Brazil and in the United States, which involved paying total fines of around US$225-million, and giving full details of the bribes.

Despite his apparent trust in Viegas, Waty also hoped that prosecutors in

Mozambique will investigate the case. “We hope that Mozambican justice plays its role”, he said. “I believe that it will intervene and that it will be impartial, equidistant, just and speedy to clear up what happened”. A representative of the Mozambican Bar Association (OAM), Filipe Sitoe, told STV “the judicial bodies should do their work, and with full respect for the rights of the suspect”.

A second person named in the Brazilian document is Mateus Zimba, who at the time was the manager in Mozambique for the South African petrochemical giant, Sasol, and is now regional director of the US company, General Electric.

Zimba was allegedly a middleman in the bribe, setting up a fake company, named Xihevele, and registered in São Tomé and Príncipe, which received the money from Embraer in an account in Portugal.

The independent newssheet Mediafax caught up with Zimba last Thursday at a conference on natural gas held in Maputo’s Joaquim Chissano Conference Centre and tried to ask him about the scandal.

According to Friday’s issue of the paper, Zimba replied “There’s nothing I can say. I have a great deal of respect for your work”.

When the reporter tried to insist, Zimba simply said “Thank you very much”.

In last week’s Rhula Weekly Media review (Teodoro Waty says he has confidence in his predecessor at LAM, page 51) it was suggested that Mateus Zimba is a former LAM PCA. This is not the case. Apologies for any inconvenience caused.

Source: Agencia de Informacao de Moçambique/Mediafax

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Assembly to question government on Embraer bribe

The case of the US$800,000 bribe paid by the Brazilian aircraft manufacturer Embraer to Mozambican officials in 2009, to ensure that LAM would buy two Embraer aircraft, will be debated in the National Assembly later this month. On Tuesday 6 December, the parliamentary group of the ruling Frelimo Party tabled a request for the scandal to be placed urgently on the Assembly’s agenda, with members of the government called to explain the matter.

There were no objections to this proposal, and so the Assembly’s governing board, its Standing Commission, must contact the government, and fix a time for the question to be discussed in the Assembly plenary sometime in the next fortnight.

Embraer was caught offering bribes in four countries – India, Saudi Arabia, the Dominican Republic and Mozambique. To avoid further legal action, the company made a full confession to both the United States and the Brazilian authorities (the United States has jurisdiction, because Embraer is quoted on the New York stock exchange). Embraer agreed to pay fines in the United States and Brazil amounting to approximately US$225-million.

Documents from the US Justice Department and from the Securities and Exchange Commission (SEC) gave details of the bribe, and stated that Mozambican officials were involved, but did not name them. However, the Brazilian Federal Prosecutors’ office was less reticent. A Brazilian document, signed by prosecutors, and by Embraer officials, names the LAM official who insisted on payment of a bribe as the then

chairperson of the LAM board, José Viegas.

It also named a key middleman (“Agent C” in the US documents) as Mateus Zimba. He was not an employee of LAM. For many years he was the Mozambican manager of the South African petrochemical giant, Sasol, and is currently the regional director of the US Company General Electric.

As detailed in the Brazilian document, Embraer was at first reluctant to “offer” more than US$80,000. But Viegas allegedly said he had received reactions from unnamed other people who regarded the Embraer offer “as an insult and to some extent it would have been less offensive to offer nothing at all”.

He thought US$1-million would be acceptable, but eventually settled on US$800,000. To channel this money, Zimba set up a company called Xihevele, registered in São Tomé and Príncipe, the sole purpose of which was to channel the money, in two instalments of US$400,000, from Embraer to the recipients of the bribe. The Mozambican Attorney-General’s Office has promised to investigate the matter.


Guebuza’s in-laws still have a head for business

Just because former president Armando Guebuza could be held responsible for the US$2-billion of loans taken out in secret by the State during his time in office doesn’t mean his in-laws are neglecting his business interests.

The family of former defence minister Tobias Joaquim Dai – who is a brother of

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former first lady Maria da Luz Dai Guebuza – is clearly besotted with his new Chinese associate Jiangbo Dou.

In Maputo in early November, Trust Holding, the family firm led by the former minister’s son, Joaquim Tobias Dai, in partnership with Jiangbo Dou, set up Transporte Zambeze, a company whose stock in trade is railway transport logistics.

The third partner in this new company is Zhoushan Huihang Transporte Maritimo. Just a few days earlier, Trust Holding and Jiangbo Dou set up Pescas do Centro, a fisheries company, while Jiangbo Dou himself had just teamed up with national fisheries company Empresa Mocambicana de Pescas (Emopesca), the main shareholder in Ematum.

Joaquim Tobias Dai set up Trust Holding several years ago with his two twin sisters Thera Rosalina Tobias Joaquim Dai and Beatriz Tobias Joaquim Dai. The first is a lawyer with CGA – Couto, Graças and Associados which is based in Maputo.


Agriculture & Fishing:

Government reaffirms priority of ProSAVANA mega-programme

On Wednesday 7 December, the government reaffirmed that that the agricultural mega-programme ProSAVANA was “a priority” among the means of converting subsistence agriculture into market production, and that it intended to increase co-operation with Japan, one of the project partners.

“The government considers this project to be important and a priority in the co-operation agenda with Japan, for the impact it will have on the modernisation

and development of the agricultural sector”, Minister of Transport and Communications, Carlos Mesquita, said at anniversary celebrations for the Emperor of Japan, Akihito, at the Japanese embassy in Maputo.

According to Minister Mesquita, ProSAVANA aims to “contribute to improving food security and increasing farmers’ incomes and introducing new technologies that will speed the transition from subsistence farming to domestic and international market production”.

Marked by controversy since its inception, ProSAVANA was conceived by the governments of Mozambique, Brazil and Japan and has generated fears of land seizure among communities living in the area of the programme and prompted protests by the inhabitants of the Nacala corridor and several non-governmental organisations that question the success of a similar experiment in Brazil.

Minister Mesquita pointed to the Nacala corridor as “the main focus” of the co-operation under an agreement concluded in 2014, “with a view to giving a greater economic dynamism to the region and promoting the well-being of the people who live there”.

The Minister spoke about the rehabilitation and expansion of the port of Nacala, and the improvement and construction and new roads between Nampula and Linchinga, in addition to the increase of electric power distribution in the region.

He also called on the Tokyo government to accelerate final investment decisions in relation to natural gas projects in the Rovuma Basin in northern Mozambique,

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where Japan’s Mitsui corporation is participating with American firm Anadarko.

“I would like to see Japan engaged in reaching final investment decisions in the Rovuma Basin, which will contribute to the increase of trade between the two countries and boost the development of Mozambique”, said Minister Mesquita.

On Tuesday, the Mozambican government approved a series of legal instruments to accelerate natural gas production in the Rovuma Basin, which is estimated to have one of the largest deposits in the world but still lacks final investment decisions by the consortia led by Anadarko and Italian ENI.

The energy sector was singled out by Japanese Ambassador Akira Mizutani as one of the areas where bilateral relations “have progressed consistently”, giving examples of electricity processing units in Nampula and Maputo as well as health and education programs and staff training.

Ambassador Mizutani also mentioned the political and military crisis in Mozambique and the of state company hidden debts scandal.

“There is a satisfaction that the will to change in Mozambique is beginning to move in the right direction, through the efforts of international mediators and the launching of the independent international audit”, the diplomat said, referring to the ongoing peace negotiations and the hiring of an external auditor to assess the real impact of the hidden loans which triggered the country’s current public debt crisis

Mozambican President Filipe Nyusi met Japanese Prime Minister Shinzo Abe in Nairobi in August on the side-lines of the Tokyo International Conference for the

Development of Africa (TICAD), where they shared their intention to deepen relations between the two countries, at a time when Japan is already one of Mozambique’s main international partners.

Source: SAPO24/Lusa

FAO mission defends “agrarian revolution” in Mozambique

A multidisciplinary task team from the Food and Agriculture Organization of the United Nations (FAO), in support of the 2030 Sustainable Development Agenda, has been considering Mozambique’s agricultural policies, access to inputs and farmers’ commitment to a successful “agrarian revolution”.

According to Ruhiza Boroto, regional representative of FAO and head of the Mozambique mission, “We need to increase production, and identify the areas and increases in yield per hectare”.

Speaking at the end of a visit on Tuesday 6 December to land cultivated by organisation projects in Manica Province, Boroto said that for “a sustainable agricultural revolution”, in addition to good state agrarian policies, farmers need to have access to certified seed and be committed to increasing production yields.

Boroto stressed that: “it is not enough to help the country achieve a standard per-hectare income for regional competitiveness under the 2030 agenda”, arguing that success must be complemented by access to quality inputs and reducing post-harvest losses.

It was still necessary, Boroto said, to help each farmer “produce enough to eat, sell and achieve self-sufficiency”.

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Castro Camarada, FAO representative in Mozambique, said that the mission was in the country at the request of the government, and said several initiatives would be developed under the 2030 Agenda to make agriculture, fisheries and forests sustainable.

Evaluating FAO intervention in the country as positive, Camarada commented on the ongoing political-military conflict between the government and Renamo, which is affecting several organisation projects in the central region of the country.

“The political-military tension does not help, especially here in the central region, which is a focus for our activities. We would certainly like to see the zone more clearly and we are hopeful”, Camarada said, adding that the end of the conflict would allow for more room for Agenda 2030 interventions.

The initiative, which covers 47 countries including Mozambique, aims to shape government development programmes in a transformative way over the next 15 years.

Mozambique was included this year in FAO Regional Initiative 2 (RI2) on sustainable intensification of production and value chain development.

The mission, consisting of experts from the organisation from Italy and regional and sub-regional offices in Accra and Harare, was expected to meet government and other co-operation partners on Thursday 8 December, in Maputo to prepare a schedule of activities responding to the FAO’s technical assistance priorities.

Source: Lusa

“Consuming eggs and chicken must be no longer a luxury by 2019” – President Nyusi

President Filipe Nyusi has said that from now until 2019, Mozambican families must not regard chicken and eggs as a luxury, but as part of their regular diet.

“By 2019, in the diet of Mozambican families, consuming poultry or eggs should not be a luxury only reserved for festive days or when visitors are received. Chicken and eggs should be part of the routine diet of our families”, President Nyusi said.

The head of state was speaking on Thursday 8 December in Rapale district (Nampula Province), at the opening session of a national one-day summit for key players in the chicken production value chain.

The President’s projections indicate that, by 2019, national chicken consumption requirements will be in the order of 96,863-tons per year and, by that time, “we will be producing [enough] to meet domestic demand and, perhaps, to export to other countries”.

Ten years ago poultry production in the country was less than 6,000-tons. At present, it is 75,000-tons.

“Production still remains insufficient to meet domestic consumption needs”, said President Nyusi, adding that it remained the government’s intention to work hard to ensure households have easy, competitively priced access to chicken nutrients and derivatives.

The President expressed concern that more than 1.5-million Mozambicans

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remained in food and nutritional insecurity.

In a speech entitled ‘The Imperative of Stimulating Domestic Chicken Production, to be Self-Sufficient and to Replace Imports”, President Nyusi said that the dream was to put Mozambique on the list of the world’s largest chicken producers, alongside the US, Brazil, China and Thailand.

“In other words, we are saying, unequivocally, that we must drastically increase production, and put an end to chicken imports within the current governance cycle (2015/19)”, he said.

The President spoke of the critical factors affecting poultry production in the country, such as high production costs, which dictate the sale price to the final consumer; smuggling of chicken imports; low productive capacity for the establishment of the national market; weak supply capacity, which forces them to import, with the aim of supplying demand during periods of deficit; the lack of professional slaughterhouses with enough storage facilities; and the reduced availability of raw material to produce feed.

To address these barriers, President Nyusi said that the government had been introducing incentives and policies to stimulate the agrarian sector in general and the national poultry industry in particular.

These include exemption from VAT on the import of raw materials for the manufacture of feed for breeding and slaughter animals; implementation of import control mechanisms for chicken through the quota system granted to some importers; adoption and

implementation of mechanisms to finance the value chain, through the introduction of a line of credit for poultry, which aims to finance small producers.

On Thursday President Nyusi released a brochure ‘Agriculture Mission 2016/17’, at which time good poultry farming practices in Mozambique were announced and exemplary poultry farmers recognised.

Today, President Nyusi will inaugurate a cashew processing plant, preside over the completion of courses at the Marechal Samora Machel Military Academy and hold a meeting with community leaders.

Source: O País

Obtala’s Mozambique and Tanzania business on the road to profitability

Impetus comes from an oversubscribed funding which is supporting the Africa focussed forestry and farming business.

In just two months Paul Dolan has effectively secured the financial future of forestry and farming specialist Obtala Ltd. and placed the business on the road to profitability.

He has done so by bringing in US$22.5-million via an oversubscribed preference share issue.

Initially, Obtala will receive US$14.25-million, with Dolan, chairman Miles Pelham and the rest of the board contributing US$2.15-million to that total.

A further US$5-million is awaiting sign-off by the investment committee of an Asia-based financial institution, while an existing financing deal has been unwound.

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The new investment was made directly into Obtala’s Argento business, which owns multiple 50-year concession leases over 312,465-hectares of natural hardwood forest in northern Mozambique.

The first US$7.5-million will go towards acquiring land and building a saw mill in the town of Nampula, around 160-kilometres from the port of Nacala.

Its 1,730-hectares of farmland in Tanzania, which produces multi-annual crops such as tomatoes, melon, sweet potatoes and seed maize, will also benefit with any funds raised above US$7.5-million available for expanding Agri production capacity.

The plan, eventually, in Tanzania is to move to orchard-style produce such as mango, avocado, pineapple and banana, which would be shipped to Dubai by boat at far lower cost than the fruit currently flown into the emirate.

It will take some time for the plan to come to fruition as Orchard’s do not grow quickly; it could take up to five years to get the agricultural business running at full capacity.

“The obvious thing is to get the forestry into production fast”, Dolan told ProActive Investors.

“It is very clear the asset is there and the demand for the output is there. It’s now a case of putting the piece in the middle together, which is the production”.

There is hiatus from January to the end of March where logging activities in Mozambique are closed down as part of the country’s sustainability programme.

This provides Obtala with the time to get work on the saw mill well underway, if not enough time to complete it.

“I’m not saying the saw mill will be up and fully operational by 1 April, but the plan is to secure the land and get everything in place in the first half of 2017”, said Dolan.

Crucially, there is a ready-market for the company’s output, which is expected to hit 50,000 cubic metres a year at full capacity.

Obtala has sales channels of its own, and signed a joint-venture with a Hong Kong firm called Basic Materials.

As there are three different hardwood classes, it is difficult to gauge the exact prices Obtala’s output will fetch; however, analysts said an average US$400 to US$500 per cubic metre is not an unreasonable expectation, with prices near US$1,000 per cubic metre for best grades.

In fact, it would be more than enough to pay a decent dividend to the preference shareholders, who will speak for 22.5% of Argento when fully vested.

Dolan won’t be drawn on financial projections. All he will say is he expects Obtala to be cash flow positive in 2017, which is no mean feat.

But endeavour in east Africa is about more than just profits.

“We want to make a social impact; it is a powerful part of our story”, said Dolan.

“For us, that is about education, job creation, and transferring our knowledge and skills”.

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This is happening at the moment, but Obtala’s impact on the local communities in Mozambique and Tanzania is not being measured in a consistent way.

To do this the firm is planning to adopt the IRIS global standard for measuring the positive effect it is having locally.

While the share price rose 8% in afternoon trade on Friday 2 December, it is clear investors haven’t yet cottoned on to the inherent value of business.

The preference share deal is worth US$100-million – that’s well in excess of Obtala’s US$63-million market capitalisation, especially when you consider that it will now have between US$14.25-million and US$19.25-million in cash.

And remember Argento is just one part of the business; through the Tanzanian agricultural assets shareholders have a way of tapping into an African growth story.

This is a continent whose population is predicted to grow by a further two-billion in the next two decades.

It is also a continent that has punched well below its weight in terms of global agriculture: it possesses a quarter of the world’s arable land and yet churns out less than 10% of its produce.

“We want to be a big part in affecting the change of those statistics”, Dolan said.

“We really think we can make a difference and have ambitions to become a major player in East African timber and agriculture”.

Source: ProActive Investors

Cashew exports may bring Mozambique tax revenues of US$33-million

The current cashew marketing year in Mozambique could provide a tax revenue of US$33-million resulting from the export of 110,000-tons of raw nuts, said the president of the Association of Cashew Manufacturers (AICAJU).

Mohamed Yunus, who made an upward revision of cashew production in this campaign from 120,000-tons expected by government entities to 150,000-tons, said that of this amount 40,000-tons would remain in Mozambique to supply the industrial units in operation.

The amount of tax revenue mentioned by the president of AICAJU is based on Mozambique applying a surcharge of US$300 for each ton of cashew nut that is exported raw.

In turn, the companies involved in the marketing and export of raw nuts should earn about US$200-million before deducting costs of transport, handling at warehouses and other expenses.

The benchmark price of the nuts currently stands at just over US$4 a pound on the international market, while the domestic market price recently hit a record of MT90 (US$1.2) per kilogram.

The cashew industry in Mozambique collapsed about 20 years ago due to proposals by the World Bank that recommended the liberalisation of export of raw nuts.

Source: MacauHub

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Mozambican company invests in breeding crocodiles

Mozambican company Agro-indústria e Comércio, Lda. (Agripec) plans to invest US$1.4-million in a project to breed crocodiles to use their skins, said the managing partner, Manuel Guimarães.

The announced investment is intended to finance the construction of a slaughterhouse in Beira (Sofala Province) and a crocodile skin tanning unit, with individual tanks for crocodiles, a hatchery and fattening and growing tanks in Chemba, one of the districts in the province. Guimarães said the company’s slaughterhouse in Beira will have a capacity to slaughter 200 animals per day, the meat of which will be consumed locally and the skins exported.

The Agripec managing partner said that crocodiles will be captured and eggs collected in Buzi district in order to increase the production capacity of the Chemba unit. The company was officially authorised to extend its crocodile catching and egg collection operation along the major rivers in Sofala Province, namely the Zambezi, Pungwe and Búzi.

Currently, residents in the riverside areas of the Zambezi in Chemba, Caia and Marromeu are directly involved in the collection of eggs, which the company buys for MT500 (US$6.7) each.

Agripec, a company founded eight years ago, has already exported 20,000 juvenile crocodiles to Europe and Asia and annually exports 1,500 crocodile skins to countries like Italy, Portugal, South Korea, Japan and France.

Source: MacauHub

Workers of the Búzi Company go on strike

On Monday 5 December, approximately 332 workers, including staff and seasonal workers, from Companhia do Búzi (in Sofala Province) halted activities in protest against unpaid workers. Activities such as cutting sugarcane and barge circulation (amongst others) were paralysed as workers complained of not receiving salaries for a period of five months. The interruption in productivity mainly effected the planting, sowing and irrigation of sugar cane. However, reports published by Diário de Moçambique suggest that barge movement was also halted, paralysing the connection of the two banks of the Búzi River, managed by the company, effecting the circulation of people and goods.

The Provincial Director of Labour, Employment and Social Security of Sofala, Jaime Chicamisse, confirmed the situation, explaining that workers wanted to go on strike as early as 6 November, but a team consisting of members from the Labour, Employment and Social Security Department; the Labour Mediation and Arbitration Department; and the major sector union, prevented this from happening.

Source: Folha de Maputo/Diário de Moçambique

Telecommunications:

Mozambique will miss analogue-to-digital deadline

Mozambique will miss its latest deadline for the transition from analogue to digital broadcasting. According to the Minister of Transport and Communications, Carlos Mesquita, cited by Rádio Moçambique on

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Sunday 4 December, the deadline for the transition, agreed among the countries of southern Africa, is 31 December this year. The Minister admitted that Mozambique cannot meet that deadline, although digital transmitters are now installed in some provincial capitals.

“The process will last six to seven months”, said Minister Mesquita. “We are practically completing the last two transmitters in border areas to avoid interference with the television signals of neighbouring countries”.

“We’re going to have about 18 transmitters functioning as from 1 January”, he added. “We shall follow this by putting into place another 55 to 60 transmitters that will cover the entire country”. Minister Mesquita put the total budget for the operation at US$156-million, to be financed by China.

The Chinese company Startimes Software Technology has been chosen to implement the transition from analogue to digital broadcasting systems in Mozambique, winning an international tender in early November.

After the digital network is installed, it will be managed by the company Transport, Multiplex and Transmission (TMT). The shareholders in this body are the public telecommunications company TdM, Rádio Moçambique and Mozambique Television (TVM). Americo Muchanga, chairperson of the regulatory body, the Mozambique National Communications Institute (INCM), has said that, if they are interested, private companies could also join TMT


More than five-million SIM cards blocked

The three mobile phone operators in Mozambique, mCel, Vodacom and Movitel, have blocked 5.7-million unregistered SIM cards, whose owners missed the 1 December deadline for registration.

The deadline was set by the regulatory body, the INCM, which warned of heavy fines for companies that failed to block unregistered SIM cards.

At a Maputo press conference on Wednesday 7 December, the director of postal and telecommunications services in the INCM, Massingue Apala, said that in the weeks preceding the deadline about two-million SIM cards were registered out of more than seven-million that were in an “irregular situation”.

The clients whose cards have been blocked will only be able to use them again, once they have registered them with the operators, said Apala.

The number of registered SIM cards is 12,439,070, he announced, and the total number yet to be registered is 5,727,292.

Since the total Mozambican population is around 26-million, half of whom are under the age of 15, these numbers seem high. But registration began in 2010, and some of the cards, both registered and unregistered, certainly belong to people who have died, or whose cards have been lost or stolen, or who have switched phone operator.

Furthermore, some clients own cards from more than one operator.

“The objective of blocking SIM cards is to promote the responsible use of

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telephones and guarantee the protection of citizens”, said Apala. The process was “irreversible”, he added, and since it began more than six years ago, users have had more than enough time to register their cards.

To register, he said, a client needs to present a recognised form of identity document. But in the absence of any document, the client can instead present two witnesses who will testify to his or her identity.

Registration is free of charge, and Apala urged anyone who has been illicitly charged to report the matter to the authorities.

The government first demanded SIM card registration in the wake of the Maputo riots against price increases of 1 and 2 September 2010.

It was argued that the rioters had been mobilised through mobile phone text messages, and so, to avoid the abuse of mobile phones for criminal purposes, all SIM cards should be registered.

The phone companies pointed out that registering all the cards was an enormous task and successfully lobbied the government to extend the deadline.

Then, as the riots faded from memory, registration seemed less urgent and dropped off the agenda.

But when Carlos Mesquita became Minister of Transport and Communications in January 2015, he revised the demand for registration. In February 2015, he gave the three companies a month to complete the registration.

Once again, government deadlines proved unrealistic. But in August 2015 the government issued a decree, and threatened companies which failed to register their clients with fines of up to MT6-million (approximately US$126,000, at the exchange rate of the time).

For a further year, the INCM kept issuing new deadlines for SIM card registration, but the final deadline, 1 December, proved real.

The abuse of mobile phones is not restricted to organising riots. The criminal gangs involved in the wave of kidnappings that have rocked Mozambican cities since late 2011 use mobile phones to contact their victims’ relatives and demand ransoms.

The authorities believe that obligatory SIM card registration will make it easier to track the owners of phones used to commit crimes.


Other:

More than 200,000 jobs created this year

On Thursday 8 December, the Minister of Labour, Employment and Social Security, Vitória Diogo, announced that more than 200,000 jobs were created in Mozambique between January and October 2016.

Speaking during the opening ceremony of a seminar on the dissemination of the Labour Law in Maputo, Minister Diogo said that the sectors which created the most new jobs in 2016 include agriculture, construction and commerce. By October 2016, the three sectors employed

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approximately 74,966 people – most of which are youths. “Improving information on the labour market is vital in aligning demand and labour supply, and in formulating and evaluating employment promotion policies”, said the Minister, who stressed the importance of the private sector throughout the process.

For Minister Diogo, in addition to prioritising training, the country must standardise the data collection mechanisms of employment opportunities, as a way to ensure better organisation of the market. According to official data, during the course of 2015, 302,188 new jobs were created in Mozambique.

Source: A Bola

“Land in Mozambique belongs to the state and to nobody else” – Maputo Mayor warns Katembe population against selling land

Speaking at the rally in KaTembe during a working visit to the area, Maputo Mayor David Simango told residents not to buy land in the district, because it is owned by the State. Notícias reports that the KaTembe Municipal District urbanisation process will soon move forward with the installation of a Development Office, which will direct the implementation of the urbanisation process.

Mayor Simango said that KaTembe’s urbanisation and development plan had been in place since 2010 to ensure that land occupation takes place in an orderly manner, and the completion of the Maputo-KaTembe Bridge next year would change life in this area of the city significantly. The Mayor said that the office will help local communities to interpret the area’s urbanisation plan. “Land, for example, will appreciate a lot in

value. But to have urbanised growth will require organisation. We are working towards distributing the plots and this will be one of the roles of the KaTembe Development Office”, Mayor Simango said.

At the end of his two-day visit to Maputo’s southernmost districts, Mayor Simango made a positive assessment of the implementation of this year’s annual plan of activities, while acknowledging the existence of barriers and resistance to the granting of land.

“In rural areas, for historical, social and cultural reasons, the land is the greatest good, its greatest wealth. That is why KaTembe residents are resisting. But we have to enforce the law: the land in our country belongs to the State and to nobody else”, Mayor Simango said.

During his visit, the Mayor led an extraordinary session of the District Advisory Council and presided over the graduation ceremony of more than 60 young people in the mobile training unit. He also visited a local health centre and learned about circumstances surrounding the construction of Rua B, already two years behind schedule.

Source: TVM/Notícias

Mara Delta expands in Mozambique

JSE-listed Mara Delta, which operates as a property fund, has bought a property in Mozambique for almost ZAR340-million (US$25.1-million). The property is home to the largest mall in the region and boasts tenants such as Shoprite, and KFC

The company, which has previously expressed its interest in expanding into Mozambique, has done the deal indirectly

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as its wholly-owned subsidiary, Delta International Mauritius, has bought Gerania – which owns Mall de Tete – from Sericea Holdings and Transformers Investment. Gerania holds 99.9% of Mall de Tete, which has the right of use and development of a property in Tete, on which the retail shopping centre, known as Mall de Tete, is located.

Mall de Tete, which was been developed by McCormick Property Development, opened on 1 December. Mara Delta says the deal makes sense because it is in line with its investment strategy to acquire rural retail centres in under-serviced markets, which meet the rigid investment criteria of strong counter-parties, underpinned by long-term dollar-based leases.

It notes a three-year net income guarantee for the entire mall is in place, the bulk of which are agreed to in dollars, and the mall will be the shopping destination in Tete and the surrounding region. The property has strong multi-national anchor tenants including Shoprite and Choppies, and other tenants include Pep, Jet, Woolworths, Studio 88 and KFC.

“Tete is considered as a major hub for economic growth in Mozambique. The region is currently experiencing a significant economic boost after major international mining companies injected billions of dollars into developing one of the world’s largest unexploited coking coal basins”.

The deal is subject to the usual conditions, and the purchase price may vary depending on warranties.

Source: Independence Online

Underweight bread on sale in Maputo

On Friday 2 December, a multi-sectoral task team consisting of elements from the National Inspection of Economic Activities (INAE) and the National Institute for Standardisation and Quality (INNOQ) – both subordinate to the Ministry of Industry Commerce – discovered that the quantity and weight of bread has been tampered with in several bakeries and supermarkets in Maputo.

In some bakeries, the bread sold is far below the regulation weight (150-grams opposed to 200-grams).

Officials acknowledge the issue and promised to address the situation.

“This is a team effort, not an individual one. I am going to meet the workforce to try to make the necessary corrections. I acknowledge the mistakes we have made”, Fáuzio Hamad, a representative of one of the bakeries, said.

INAE’s National Director of Operations, Virgínia Muianga, says that her institution would be relentless in pursuing irregularities and agreed on the urgent need for the merchants to comply.

“This is an initial job. An inspection starts this way, surveying the situation on the ground. After that, there is a process itself”, she explained.

The INAE and INNOQ inspections are also taking place in other provinces in order to guarantee that the consumer gets what they pay for in the festive season.


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POLITICS

Decentralisation continues to divide government and Renamo

Government and Renamo delegations remain divided over the decentralisation proposal put forward by the mediators at the end of the fourth phase of the negotiations.

The two delegations met international mediators separately on Friday 2 December in Maputo to try to reach an understanding.

The first meeting took place in the morning and brought together the international mediators and the government team.

The proposed law on the decentralisation of power and the cessation of military hostilities were the main topics discussed in the nearly hour-long closed-door negotiations.

According to Mario Raffaelli, co-ordinator of the international mediators, consensus has not yet been reached on these matters.

“We have come together to hear the government’s proposal on the agenda items and then we will introduce them to the Renamo party”, Raffaelli said, adding that: “there are some significant advances in the talks at the moment”.

According to Raffaelli, talks are more productive when they take place separately.

In fact, mediators have only met the government and Renamo delegations separately since the end of the third

phase of the political dialogue last September.

In the afternoon, it was Renamo’s turn to meet international mediators. The meeting was chaired by Father Angelo Romano – Raffaelli having had to make a trip to Italy.

This meeting was shorter than the first, with Romano simply stating that the points were still on the table, without advancing any date for further meetings.

Source: O País

Joint Commission meets and says nothing

The full Joint Commission between the government and Renamo met in Maputo on the morning of Monday 5 December to discuss the latest proposals on decentralisation made by the international mediating team.

At the end of the fourth round of talks in late October, the mediators left a proposal on decentralisation with the two sides, centred on the question of provincial governance. Renamo has been demanding the right to rule six central and northern provinces where it claims to have won the 2014 general elections.

When the fifth round of talks began, in the second week of November, the mediators collected the response to their proposals from both sides, and then redrafted the document, in an attempt to reach a consensus.

The mediators opted to work separately with the government and Renamo

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delegations, and so it was only on Monday that the Joint Commission met in plenary session. The meeting lasted for about three hours, and at the end nothing was made public. Neither the mediators nor either of the two delegations was willing to make any comment to the press.

The mediators had hoped that draft legislation on decentralisation could be sent to the National Assembly in November. That deadline has been missed, and even if a consensual position is agreed, the likelihood of forcing it through the Assembly before the Christmas and New Year holidays seems minimal.

The Assembly’s agenda is crowded with matters that cannot be postponed, including the government’s Economic and Social Plan for next year and the accompanying 2017 State Budget, President Filipe Nyusi’s State of the Nation Address, and the report from the Parliamentary Commission of Inquiry into the loans taken out, with illicit government guarantees, by the quasi-public companies, Ematum, Proindicus and MAM.

The last possible date for the current Assembly sitting to end is 22 December. It seems scarcely possible, in the next 17 days, to slot in a serious debate on complex decentralisation legislation, and possible constitutional amendments.

The whole purpose behind establishing the Joint Commission was to pave the way for a face-to-face meeting between Nyusi and Renamo leader Afonso Dhlakama.


Joint Commission to establish a new working group for decentralisation

On Wednesday 7 December, the Joint Commission decided to establish a working group to draw up principles to guide a future law on decentralisation.

Speaking to reporters after a plenary session of the Commission, the head of the government delegation, former security minister Jacinto Veloso, said that the members of this working group will be appointed by President Filipe Nyusi and Renamo leader Afonso Dhlakama.

“The parties realised that the best way of speeding up the process of approving, or creating, or drawing up legislation on decentralisation is by creating a flexible working group, small and competent, capable of drafting is as short a period of time as possible the philosophy and principles that should be observed in such legislation”, said Veloso.

As for the international mediating team, it had not yet been decided whether any of them would take part in the working group. This and other practical issues concerned with how the group should function were discussed when the Joint Commission met again on Thursday 8 December.

This was the third plenary session since the Commission resumed its work in the second week of November. Most of this time has been occupied with bilateral meetings as the mediators met first with the government delegation, then with Renamo, in repeated attempts to reach a consensual position on decentralisation.

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It is not at all clear why a new working group is needed, since in August the Joint Commission set up a sub-commission to draw up a package of constitutional amendments and new or amended laws on decentralisation, which should all be in force before the next general elections, scheduled for 2019. As far as is publicly known, that sub-commission has produced nothing at all, and certainly no new bills or draft constitutional amendments have gone before the National Assembly.

In the absence of anything from the sub-commission, the mediators produced their own proposal on decentralisation at the end of the fourth round of talks in late October, and left it with the two delegations for their comments. The mediators hoped that when the fifth round started, in November, it would be possible to reach consensus. But despite the mediators redrafting their proposal after repeated meetings with both sides, no consensual position has emerged.

The main contentious issue is clearly Renamo’s demand that it should be allowed to govern six central and northern provinces where it claims to have won the 2014 general elections. Most of the mediators’ October proposal concerned provincial governance – but it avoided saying how many (if any) provinces should be delivered into Renamo’s hands.

Meanwhile Renamo’s illicit militia has continued to stage ambushes on roads in the central provinces, and no moves at all have been taken to disarm and demobilise the Renamo gunmen.


Joint Commission still discussing working group

On Thursday 8 December, the Joint Commission discussed matters concerning the creation of the group that will draw up principles to guide a new law on decentralisation.

The Commission took the decision to establish the working group at its meeting on Wednesday.

“We are continuing to engage in productive discussion and we shall continue again tomorrow”, the spokesperson for the international mediating team, former Botswana president Quett Masire, told reporters after the meeting. (Masire has taken over temporarily from EU representative Mario Raffaelli, who is out of the country).

The exact role of the new working group is far from clear. It seems to duplicate the sub-commission that was set up in August with the task of drawing up a package of constitutional amendments and new or amended legislation on decentralisation which should take effect before the next general elections (scheduled for 2019).

That package was to include legislation on provincial governments, and provincial finance, and a re-examination of a 1994 law, never implemented, on setting up municipal districts.

A constitutional amendment is required in order to change the way provincial governors are appointed. Currently the President of the Republic appoints the governors, but Renamo is demanding the right to appoint governors in the six central and northern provinces it claims

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to have won in the 2014 general elections. The second opposition party, the MDM is insisting that the governors should be elected.

Although the sub-commission was tasked with drawing up this legislation in August, nothing has yet been made public, let alone submitted for debate in the National Assembly.


Quelimane Mayor disappointed with Frelimo

The Mayor of Quelimane (Zambézia Province), Manuel De Araújo, believes that Frelimo should follow the example set by Renamo with regard to the decentralisation proposal, instead of criticising the opposition party’s proposals at every turn.

Negations aimed at restoring peace in Mozambique are currently underway in Maputo, however, there remains a lack of consensus between Renamo and the government.

According to Mayor de Araújo, Frelimo is making numerous mistakes. In his opinion, instead of always criticising the opposition, the ruling party should follow Renamo’s example, which has long since submitted its proposal to the international mediators.

“We have already seen Renamo’s proposal and it shows that the only one who is interested in peace in Mozambique is Renamo, while Frelimo is disinterested. Renamo has already submitted its proposal to the negotiating table and Frelimo should do the same”, he emphasised.

Maria Helena, secretary of the National Liberation Combatants Association (Associação dos Combatentes de Libertação Nacional, ACLIN) in the province of Zambézia, expressed her concern over the situation and argues that she does not understand why there is always misunderstandings in the talks between the government and Renamo.

The former combatant deplores the fact that many young people have lost their lives unnecessarily in armed clashes between Renamo armed men and the Mozambican Defence and Security Forces.

“I do not know what is failing, everything falls apart without consensus as we continue to lose many young people who should be working to fight hunger and poverty. The young people we are losing should take care of their families instead of being mobilised to kill fellow countrymen”, said Helena.


Daviz Simango supports the election of provincial governor in 2019

On Wednesday 7 December, the leader of the MDM and Mayor of Beira, Daviz Simango, again defend the need to revise the Constitution of the Republic in order to enable the election of provincial governors.

Mayor Simango, who was speaking in the city of Quelimane (Zambézia Province), explained that nothing justifies the fact that the provinces have governors who are “remotely controlled” by the government in Maputo. In addition, he argued that these governors often do not understand the problems faced by the locals because they often

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do not originate from the provinces which they are selected to govern.

He said that: “The revision of the Constitution is urgent, bearing in mind that we have to be flexible in effective decentralisation. We want local elections to choose local people to solve our problems … “

Source: O País

“Peace not just up to me and Dhlakama”, President Nyusi tells FAMOD

On Friday 2 December, President Filipe Nyusi said that the mission to re-establish peace in Mozambique should not be left solely up to himself and to Afonso Dhlakama, leader of the rebel movement Renamo.

In his view, in order for efforts to achieve peace to bear fruit, the involvement of everyone is necessary.

President Nyusi was responding to a request from the forum of Mozambican Associations of the Disabled (FAMOD) for him to continue efforts to secure peace. The FAMOD delegation went to speak to the President in his office on the occasion of the United Nations International Day of Persons with Disabilities, which is celebrated on 3 December.

“From the efforts we have been making, I feel that, with the support and awareness of all Mozambicans, we will be able, very rapidly, to achieve some consensus”, he said. “Don’t leave this mission up to Renamo leader Dhlakama and your President on their own. Were it to depend on just these two, we would

already be speaking a different language”.

The FAMOD delegation wanted the military tension that still prevails in parts of the country to cease immediately, because it makes each and every citizen “a candidate for disability”.

“Your message is very profound, when you say that with war there are many candidates for becoming persons with disabilities”, said President Nyusi. “That’s no lie, because some of you here today are disabled as a result of this man-made disaster”.

He added that the collaboration, honesty, frankness and will of Mozambicans “count more than two people whom we always say are important – because nobody is more important than the people as a whole”.

In its message, the FAMOD delegation also expressed concern at the country’s economic and financial crisis, which is driving up the cost of living. In response, President Nyusi called for increased food production “within the capacities of each person”.

He insisted that the solution lay in increased production, and solutions to the crisis “depend on Mozambicans as a whole”.

FAMOD urged the government to undertake concrete actions aimed at the inclusion of people with disabilities at all levels. “To achieve this, simple insertion in the Ministry of Gender, Children and Social Welfare, which we have been seeing in an incipient form, is not enough. The question of disability should be understood as something that cuts across all issues, and so should be

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reflected in all ministries”, said the FAMOD message, presented by Cantol Pondja.

Among the problems Pondja raised were ensuring that disable people have access to health, education and transport services, the lack of sports grounds that disabled people can use, and the need to train interpreters in sign language.

These aspects, he said, would allow greater inclusion and active participation in the life of the country, contributing to a “less discriminatory” society.

FAMOD is a coalition of 24 associations of and for people with disabilities, and its main goal is to promote and protect the rights of the disabled.

Source: Agencia de Informacao de Moçambique/TVM

Renamo expresses interest in achieving peace

On Saturday 3 December, Renamo officials gathered in Maputo in order to attend a training meeting.

During the meeting, the party’s General Secretary, Manuel Bissopo, expressed Renamo’s interest in achieving consensus for the restoration of peace.

“A lot of effort is going into this from Renamo’s side, in fact, this military-political crisis will end so that all Mozambicans may engage in the real stages of work for the country’s development”, said Bissopo, who considered that Frelimo should also do their part.

“On our side, there is all this effort, but we hope that our brothers from Frelimo

also embark on this mission as soon as possible, under an agreement so that we may return the country to normalcy”.

On the topic of staff training, Bissopo said that the aim is to provide members with the ability to mobilise the party, with eyes on the next election.

“We are carrying out training on what to do on a day-to-day basis in order to mobilise people, to convince people that Renamo and president Dhlakama are the right people to run the country, to meet the needs of these wonderful people”.

Bissopo said that party cadres should adapt to new social dynamics to be able to mobilise people.

Source: O País

Dhlakama has faith in the resumption of good relations between the IMF and Maputo

Renamo leader Afonso Dhlakama believes that Mozambique’s financial crisis can be overcome as long as the Frelimo government shows goodwill. But ending the war is the main objective, he says.

An IMF mission has been in Maputo since Thursday 1 December to start discussions about a new support programme. In April, the IMF suspended aid to Mozambique following the discovery of state-guaranteed hidden debts valued at around €1.2-billion. The last IMF mission to the country – in June – noted government progress in managing the case. Deutsche Welle Africa sought the opinion of Dhlakama on the subject.

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DW Africa: The Mozambican economy is in crisis and the consequences of this are already visible in price increases and currency devaluation. There is much discontent amongst the population, including the middle class. What is your expectation regarding the outcome of this case which has set the Mozambican government and the IMF at loggerheads?

Afonso Dhlakama (AD): It is a very difficult question, but I will answer because I am Mozambican, and I was born, studied and grew up here, so I know the situation.

Everything has a solution if there is goodwill on Frelimo’s side. For example, we are talking about debt, not the debt which is the responsibility of the Mozambican State, but the debt of those known people who went to get money from the banks there in Switzerland, in Europe, to buy things. And the signatures [of those people] are there with the banks. So here is a mix of things, but the International Monetary Fund wants to do an audit to identify the people [responsible] and see the measures and the rulers have already accepted it. There are voices against it, but this is how to encourage the IMF to again believe in this country, Mozambique.

On this subject, Europe and the friends of international co-operation may even sympathise and come en-masse to – I do not say to forgive the debt, [because] those responsible for the debts will be punished and held accountable – but at least European and American companies could trust Mozambique again. All this needs peace; only this way can investment be encouraged.

For example, the currency is undervalued because there is no production. Mozambique survives by the outstretched hand. There are no exports and the currency cannot be strong when the country is fed on imports. It is necessary to produce, to have companies to produce, to see that tourism, agriculture, industry, fishing etc. are reinvigorated so that our currency, the metical, can regain its value.

Now, I do not want to take my sardines off the coals, but I think the solution, in the first instance, is to end the armed conflict and have a national reconciliation. Frelimo accepts that there should be strong state institutions that are not instruments of Frelimo, that there is a rule of law and a governmental alternation. This is what the world wants to see, because it guarantees investments. But if Frelimo wants to continue to drag the war out because it is afraid that, with stability in the country, some of these people will end up in prison… because they are scared. While the war continues, they remain camouflaged. But we are putting on the pressure.

DW Africa: From the social point of view, what do you expect in the medium-term, especially in urban areas? Do you think people will go out onto the streets or settle down? Because the difficulty of access to food and other things is serious, and growing.

AD: It is not as easy as in Germany, France, Portugal or the USA. The institutions themselves do not encourage civil society to hold demonstrations which, in fact, put pressure on the regime. They can have a silent march, but those demonstrations where people speak out

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do not happen because they know people get shot and die, and no-one wants to die. That is why I do not believe that demonstration is the solution in Mozambique’s case.

The solution is that the war ends, for people to start transporting and marketing products in distant rural areas so that they can reach urban standards, and gradually the situation will change. I continue to maintain that a Mozambique without war, with good economic policies and with investment, can be one of the richest countries in southern Africa, because it has resources that have not yet been explored.

DW Africa: Some time ago it was said that Vale’s trains were used to transport weapons for the Defence and Security Forces of Mozambique and that Renamo intercepted these trains and seized the weapons. Can you confirm this?

AD: We didn’t get to seize anything. We just frightened them a bit and, out of fear, they stopped. I can confirm that.

DW Africa: But were they transporting weapons?

AD: It is not easy to see a weapon being transported. Any regime could do that, but it would be harmful. The trains of the Brazilians, which carry coal from Moatize to Ports in Nacala or Beira, [may] do that. It gives the regime power to continue the war if it thinks it has allies who will carry their material on trains. There Renamo did not forgive and frightened them a little and the trains stopped. They are not even loading the trucks, just one or two.


New ministers: put politics in command

Frelimo Political Commission member Conceita Sortane was named education minister on 26 November, replacing the highly respected Luís Ferrão who had been in post for less than two years. Minister Sortane has a Masters degree in education from the Pontifício Universidade Católica (PUC) in São Paulo (Brazil), but her only recent educational role was in a previous post as Frelimo Central Committee Secretary for Training and Cadres.

At the time of her appointment, Minister Sortane was a member of parliament and chair of the parliamentary Commission on Social Action, Gender, Technology and Media.

At the October Frelimo Central Committee meeting, Minister Sortane was named to head the national party brigade in Cabo Delgado – President Filipe Nyusi's home province.

Ferrão is the second respected technocrat to be replaced as minister by a political appointment in the space of two months. Pedro Couto was dismissed in late September as minister of Mineral Resources and Energy, and replaced by Leticia Deusina da Silva Klemens who had no experience in the area.

At the time of her appointment, Minister Klemens was chair of the general meeting of Mozambique’s largest commercial bank, Millennium-BIM, as well as secretary of the general meeting of the main employers’ body, the CTA. She was also ambassador in Mozambique for the US State

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Department’s African Women’s Entrepreneurship Programme.

When she was appointed, it was noted that the 44-year-old is part of the new generation of Frelimo children, and she is in business with the children of the key leaders of the independence struggle: former presidents Samora Machel, Joaquim Chissano, and Armando Guebuza as well as influential figures Alberto Chipande and Tobias Dai.

Ferrão and Couto were seen as two of President Nyusi’s most important appointments – respected, honest technicians who could bring about change. Reasons are never given for dismissals in Mozambique, and there is widespread speculation as to how Ferrão fell from grace. One rumour is that Ferrão tried to force people to do more work on education and less for Frelimo during the working day.

On 30 November, Canal de Moçambique claimed that Ferrão tried to crack down on widespread corruption in text book and school desk procurement. Education (like agriculture) has become a sclerotic ministry, with rigid fiefdoms and an expectation that no one had to work too hard, and there was time for Frelimo party work and business.

A mark of the lack of organisation is that, more than a week after Minister Sortane took office, the Ministry website still listed Ferrão as the minister.

Naming Sortane minister will make it much easier for Frelimo to use the Ministry of Education in election campaigns in 2018 and 2019.

Also on 26 November, Augusto de Sousa Fernando was named Deputy Minister of Mineral Resources and Energy, a post that had been left vacant since President Nyusi took office in January 2015.

Fernando is trained in electrical engineering, and has spent much of his professional life as a senior figure in the state electricity company, EdM. He was chair of the EdM board of directors between 2010 and 2014, and had been an EdM administrator from 2006, in a period when EdM failed to make essential investments.

Agencia de Informacao de Moçambique recently noted that Fernando “was honest enough to declare, in March 2014, that the electricity tariffs practiced by EdM were ‘unsustainable’. But, faced with an election that coming October, the government of the time, led by president Armando Guebuza, refused to put up electricity prices, thus condemning EdM to continue running at a heavy loss”.


Minister Namashulua calls for transparency in elections and CNE wants new electronic checking system

Speaking on Monday 5 December, at the opening of the 13th International Symposium on Elections, the Minister of State Administration and Civil Service, Carmelita Namashulua, said that it is vital to avoid all illegal practices and hold transparent elections in order to guarantee peace and harmony among Mozambicans.

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The event takes place less than two years before Mozambique’s local elections and less than three before the general elections.

The Minister also said that it was essential to know how to take advantage of information and communication technologies to guarantee transparent elections.

“The electoral materials and equipment we use make it necessary to reflect not only on the evolution of electoral technologies but also on the ways we use these technologies so that we have well-conducted electoral processes capable of producing results acceptable to all”, Minister Namashulua said.

On the other hand, the Minister said, although Mozambique had always struggled with boycotts and the challenge of funding elections, it could however boast regular ballots.

“We are proud of having been able to hold uninterrupted elections, without delay, despite financial difficulties, and sometimes in the face of boycotts by some organisations that do not comply with the rules of the democratic game”, she said.

The first day of the International Symposium on Elections was attended by the president of the Constitutional Council, Hermenegildo Gamito, deputies of the Assembly of the Republic and representatives of the National Electoral Commission and electoral commissions from other countries. The event ended on Tuesday.

CNE wants electronic checking:

The president of the National Election Commission (CNE), Abdul Carimo, says that the next ballots may have a technological innovation consisting of the electronic checking of the voter card to certify its authenticity and provenance. Carimo says that for the implementation of this innovation, the government must approve the necessary budget, a proposal for which has already been submitted to the executive.

“If we get the budget we have asked for, we can move on the issue of verification”, he explained.

Source: O País

Guebuza heads delegation sent by President Nyusi to attend Fidel Castro’s funeral

President Filipe Nyusi appointed a delegation, led by the former president Armando Guebuza, to attend Fidel Castro’s funeral ceremonies.

The burial of the former president of Cuba, took place in Santiago de Cuba, from 3 to 4 December.

The Mozambican delegation to the funeral ceremonies was headed by Guebuza, and included Eusébio Lambo Gumbiwa, Minister of Combatants; Raimundo Pachinuapa, former inspector of the State; Miguel Nkaima, Ambassador Extraordinary and Plenipotentiary of the Republic of Mozambique to the Republic of Cuba; and António Macheve, Deputy Director for Europe and America at the Ministry of Foreign Affairs and Co-operation.


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Chissano and Mbeki suggest resumption of Lake Niassa negotiations

The former president of Mozambique, Joaquim Chissano, and the former president of South Africa, Thabo Mbeki, are expected to meet soon with Tanzania’s head of state, John Magufuli, following a meeting with the Malawian President, Peter Mutharika. The discussions will centre around the reactivation of the negotiations around Lake Niassa.

According to the Malawian media, mediators of the Lake Niassa dispute (between Malawi and Tanzania) recommend a resumption of negotiations after a year of impasse.

Malawian Minister for Foreign Affairs and International Co-operation, Francis Kasaila, confirmed that the mediators had asked Malawi to return to the negotiating table.

Negotiation were suspended for another year following a disagreement between the two countries over the allocation of Lake Niassa, known to Malawians as Lake Malawi.

In November 2012, Malawi and Tanzania agreed to appoint a regional mediator to resolve the border dispute over the lake, which is potentially rich in oil and natural gas.

The Malawian government claims full sovereignty of Lake Niassa, except for the area belonging to Mozambique; while Tanzania claims that it is entitled to half of the northern part of the lake.

The dispute, dating back more than 50 years, threatens to worsen relations

between the two neighbouring countries, which also belong to the Southern African Development Community (SADC) and the Common Market for Southern and Eastern Africa (COMESA). In 2013, Malawi withdrew from the talks accusing its neighbour of intimidating Malawian fishermen. Tanzania subsequently denied the claims. Minister Kasaila hopes the talks will resume soon.

Last year, the Malawian government wrote to the mediators informing them that, while accepting the sharing of resources as part of the settlement, the legal question of who owns the lake remains a crucial issue.

Malawi also wants Tanzania to remove a map showing the border line that passes through the middle of the lake disputed by the two countries. The gas discovery off Tanzania and Mozambique suggests that the region could become the third largest exporter in the world.


The current situation of Mozambique through the eyes of Father Couto

A week ago, Rádio Moçambique interviewed Liberation struggle veteran Father Filipe Couto, former Rector of the Catholic University of Mozambique and of Eduardo Mondlane University.

Rádio Moçambique (RM): Mozambique has been independent for 41 years. From a social and political point of view, how do you view the evolution of our country in these four decades?

Father Filipe Couto (FC): The country has moved forward. You have said

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correctly that it has been 41 years, and a lot has happened in the country. Mozambique has institutions that are operating, and can operate better. It has human capital, it has young people. There is reason to look to the future with optimism.

It is only necessary to have your feet on the ground, keep our head up and try to act in the correct way; to be a country that puts ethics and morals first, and where everything is done so that those who are in politics work for the common good.

RM: What can the country be proud of and what are the exciting prospects for the future, particularly in the social and political aspects?

FC: What I am proud of is that, after 41 years, we have a new President who is not from my generation, who did not fight in the liberation struggle against the Portuguese colonial regime, even though he was born in an environment where there were former combatants.

A President who was formed and grew up, somewhat, with former combatants, but later entered into “normal” institutions, which were not under the pressure of war.

So, after 41 years we have a young President. The young people of your generation may well be proud of this and claim that they are in power. With better eyes, ears, age, health and education compared to his predecessors.

The country has changed. It is not a Mozambique that repeats all the mistakes we have made in those 41 years. When I talk about mistakes, I do

not say that we just made mistakes. We have also done good things which our young people must now take forward.

RM: The official discourse today points to the need for all Mozambicans to make united efforts to make development a reality. Do you see the reaction to this challenge repeated enough in our society?

FC: In society a lot is repeated. It is often said that things do not work. I agree that a lot does not work, but I get the impression that people who think nothing works blame only one individual, namely the President of the Republic, in this case Filipe Nyusi. But he is an individual who can inspire good; it is not he who makes the changes.

Everything should start in the institutions we have, such as education, health, safety, interior, defence, labour, energy. We [Mozambique] cannot move forward when institutions in the service of the State function in the same way as in those times.

That is something that must change, for it is no longer justifiable for things to go on like this, but that does not depend on the President alone.

These are things that we must do and there are those who must put pressure on for this to work: in this case, educated young people who know their rights and duties.

RM: People talk about the longed-for development process, limiting themselves to criticising everything that is done or not done by the government. What do you think about these positions?

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FC: (Text missing) … I do not agree that youth only criticises. Today, those who criticise are not the young, those who criticise may even be us, who are older. We use the youth, instructing them to say this or that through the internet and social media networks.

RM: Are you saying that youth is being manipulated in some way?

FC: Certainly. The youth has never been as manipulated as it is today. And this is done through technology, media, cell phones, computers, social networks. That is, all these things are one great manipulation, making it difficult for the young people to reach into his or her own heart and think about what he or she is.

The young person thinks that what the media says is what he is. And you cannot find yourself as a young person and see what you really are in the environment in which you live.

In this sense, saying that young people only know how to criticise is not correct, because there are those who have the mastery of the media and manipulate society and young people.

It is rare to find a young person currently talking about things he has not heard or read. One who speaks what comes spontaneously to his soul.

There was never a time where there is [such a] need for the young person to find moments in which to isolate him or herself from the telephone, from social networks, television, radio and everything, and think a little about the workings of his or her surroundings

Think about what happens in the family, the rise in price of bread, sugar, why and how it can be overcome, for example. The answer does not have to come from social networks.

There is something here that shows us how much manipulation there is and how it is necessary to enter into ourselves as individuals and find moments to reflect on what is happening, not act as if we were robots or dolls that are operated from behind the scenes.

RM: Do you believe that the goals of those who manipulate young people are not to develop the country?

FC: I do not say that these people are doing this intentionally or with malice, but it is the way the dialogue spreads among people, in the news. It is not easy to find people who have opinions or thoughts of their own. Almost everyone hears everything from somewhere or someone

I’m sorry, where are we? I mean, without WhatsApp, BBC, Voice of America, are there no thoughts? Where are we?

RM: Do you think that social vulnerability in our country suffers from problems that make it destructive?

FC: The country is an anonymous thing. There needs to be groups of young people who begin to think seriously about what is happening at home, on the block, or where they are, and see how they can handle the message themselves and not always expect someone to solve the problem.

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It is not right to expect the president to do everything himself. We are more than 25-million people; this is too much for one single head.

RM: How do you interpret the criticisms made by many sectors of society of the current head of state?

FC: Honestly, for me, I think there was no better era in our country than now, where we have that possibility and we see the President criticised. I am glad to have never heard that the President is wanting to sue someone who has spoken ill of him. He always lets things go forward. This is good.

Mind you, I am not saying that the country should not use force (defence, police), but respect for authority should not be imposed. It must come because we have seen that it is necessary to accept authority if we want to go forward.

For two years now, socially the President is only criticised. Very few people point out what he does well.

Unfortunately, criticism is being served up by media technicians, which gives the impression that whoever has the authority to speak and use these media is happy to always speak of the President or the presidency as if it were something that does nothing.

But this is not how we are going to build a new Mozambique. The danger, in this moment of transition, is that everything is lost.

RM: What is the risk of losing everything when criticism is at these levels, particularly in relation to the State?

FC: I’ll explain this historically. The Christian Democrats in Italy were a well-disciplined party, had well-educated people and enjoyed good times, but when within the party they began to enter a certain repetition among those in power, within a short period of time Christian Democracy was undone and in came another merchant, Berlusconi. The Soviet Communist Party, after 50 years, was finished.

A new team came in, but then the communists themselves wanted to launch a coup against Mikhail Gorbachev, so it turned out that a case had to be brought against the Communist Party and it became illegal. They went home. This means that if we only criticise, we will end up undoing Frelimo and then there is nothing.

Do we want to put the thing to chaos, into disorder … Then we will have to work to set matters right again? The most exemplary way it would be to say ‘okay, there’s a new person there, let’s support him, criticise him objectively’.

One must know that everything does not depend on this new person, but we are in an era in which old schemes that Frelimo had already passed.

What amazes me is that even us, former combatants, instead of being clear that things can end up this way, and so we should support our young man, seems like it is us fomenting … Excuse me.

RM: So you assume now that there are bad intentions in the model of approach you are criticising?

FC: No. I myself often fall into this trap, into this way of thinking. It is easy to talk

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like this here but in my private life I sometimes criticise President Nyusi.

RM: … implicitly?

FC: Implicitly or even speaking without thinking about the consequence of what I am saying. There is a lot missing with regard to what I was talking about before: silent reflection to know what it is I am saying and doing, what we are all doing.

RM: Father Couto, we are focusing on criticism, merit and demerit, particularly in Mozambique. In your opinion, how can we have constructive criticism?

FC: Constructive criticism … Let’s see. Who does not say that he wants peace here in the country? Everyone says they want peace, peace, peace! But the young President went to the Indy Village to meet Afonso Dhlakama. He was the first to arrive and waited for the Renamo leader.

It happened that members of the Political Commission went to the provinces to say that one could not talk with Dhlakama in just any way. Well, they were convinced of that, but that young man went to Dhlakama to start making peace!

Then they keep on saying, ‘we want peace, we want peace, we want peace’ … But, excuse me? This one you’re asking for peace, do you not remember that he went to Indy Village to wait for Dhlakama and has been criticised for it? Why not say: ‘we thank you for going to meet Dhlakama, but this is not everything, you have to do much more’?

That is, to give more suggestions, for example, to let Dhlakama be in

Gorongosa, where he likes to be and to acknowledge his status there, because he prefers to stay there instead of being with big people. I think we should begin to recognise the efforts made by President Nyusi.

RM: You said recently that the best way to solve the country’s current problems will be a reform undertaken by young people. Given the scenario that characterises the youth, that in your opinion youth is being manipulated, do you think we are in a position to implement this reform?

FC: We are fully fit. There is no need to make noisy demonstrations. No shotguns are required. More reflection and determination of programmes are what is needed. For example, why not listen to the young President when he says he wants to bank on food production in the country?

RM: Um … specialisation of each province in a given agricultural product?

FC: Yes. But let us not talk. Think about it, take it and tell him how to do it. He wants to do something good. He continually says that this is his plan. And remember one thing.

Out of about 25-million Mozambicans, don’t think that there is nobody who likes him, although some want to give the impression that he has lost popularity.

RM: Speaking of which, do you feel that the President lacks the necessary support from Mozambicans?

FC: No. The little man in the district does not say it’s President Nyusi’s fault. He is upset or does not accept how the

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local organs handle the issues, how the President will put an institution in Chiconono, Sanga, or Khongolote in its place. How is he going to solve the problem of a dead man and the police arrest the suspect but the judiciary says he can’t be sent to prison and sets him free?

It is the organs of propagation of images, news. There, those who are behind it are certainly not only young; there are people who have the influence and the money to make it possible and manipulate the majority.

RM: Mozambique is experiencing social, political and economic unrest. What measures should, in your opinion, be taken to end this scenario in the medium or even the short-term?

FC: I believe that talking as if we were talking about something that does not belong to us is coming to an end. I believe that, for example, what happened to O Nosso Banco touched a lot of people and our job is to question why the organs of justice have done nothing in this situation? I believe this will come to an end because people slowly understand that the future depends on us.

The future depends on me, on you, on each of us and on those who are in union with us to work. When that happens to the fullest we will forget the time that has passed because the changes will be instantaneous.

History is made up of things that happen in a very short time, but that have resonance. I think the citizen already knows that to deposit money in the

bank, we must be careful, they have instantly learned from what happened to O Nosso Banco.

It happened because we have a young President who let the news come to the surface. He did not have to hide it, he let it be made public. Is this not a good thing? So my message is that this can help us see how we can go forward by supporting this young man who is starting something good.

RM: What can we expect from the future of our country, taking into account all the aspects we have covered in our conversation?

FC: I can only hope for a better future for Mozambique and it is a better future that is in your hands, young people, with a young President. You will not fold your arms and let things go wrong.

But it’s not just the President that will do it, it’s us, because we want something better than this. There has never been a time that would indicate that Mozambique will move forward like this.

RM: Is the future bright in your opinion?

FC: The future is right. It’s good. But we have to work more and gossip less. Have morality, justice and consistency. Furthermore, we combatants must give confidence to young people and not live in fear, thinking that young people are only foolish. No, sir! Of course they make mistakes, but they have the possibility of making Mozambique a better country.

Source: Jornal Domingo/Rádio Moçambique

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SECURITY

Renamo attacks armed escort in Sofala Province

On Monday 5 December, suspected Renamo gunmen launched an attack against a convoy under the protection of the FADM. The attack occurred along the EN1 near the Pinda Village, Machanga District (approximately 45-kilometres from the bridge that crosses over the Save River), Sofala Province.

The attack was allegedly focused on a passenger transport vehicle owned by Linhas Terrestres de Moçambique (LTM). Two passengers (from Maputo and Tete) were injured by broken glass and shrapnel.

Following the attack the injured passengers were taken to the Save Health Centre, where they received medical attention. Thereafter, the convoy continued with its journey.

The FADM have reiterated that units remain committed to ensuring public order, security and tranquillity.


Jindal train attacked along the Sena Railway Line in Sofala

At approximately 4:00hrs on the morning Wednesday 7 December, suspected Renamo gunmen attacked a train belonging to coal miner Jindal along the Sena Railway Line in Cheringoma District (Sofala Province).

The train was attacked on the section between Lavos and Nhamitanga, near the administrative post of Inhaminga,

while transporting coal from Moatize (Tete Province) to the port of Beira.

According to eyewitnesses, the train driver was rush to hospital after sustaining various injuries in the attack.

Another online publication indicated that the driver reportedly died as a result of being shot three times, however, this cannot be confirmed at this time. The Jindal train remained at the scene until noon.

By Wednesday afternoon the PRM of Sofala Province had yet to confirm the attack, stating that the incident had not been reported to them.

Unconfirmed reports also suggest that on Monday 5 December, a Vale train was also attacked by suspected Renamo men in the Caia zone (Sofala Province).

According to reports, the train was not damaged in the attack, which the PRM have yet to comment on.

In the meantime, CFM has reported losses of approximately US$3-million as a result of Renamo attacks in the central region of the country.

The losses stem from the stoppage in the movement of freight trains along the Sena Line.

The attacks, in addition to affecting the trains belonging to Vale, are damaging the companies that operate at the port.

Source: RTP News/VOA Português/Folha de Maputo/Zitamar News

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Independent journalist attacked in central Mozambique

At least eight armed men claiming to be members of Mozambique’s security services attacked the house and family of a prominent independent journalist in Manica Province on the night of Wednesday 7 December, beating and abducting his teenage son and a friend.

John Chekwa, a journalist with the community radio station in Catandica, a town on the highway between Chimoio and Tete – which has been the scene of repeated clashes between government and opposition forces – said on Thursday that “more than eight” masked and armed men, claiming to belong to the PRM’s Rapid Intervention Unit (FIR), beat and threatened to kill his 15-year-old son and his friend.

Chekwa himself was not home at the time of the attack, learning of it later from his son. According to his account,

the attackers broke down the front door and stormed the journalist’s house (located in the Expansão Mugabe neighbourhood) calling out: “John Chekwa where are you”. Once the attackers had searched the residence they asked Chekwa’s son where his father was, saying “Shall we kill him here or at the slaughterhouse?”

The attackers told Chekwa’s son and his friend that they belong to the FIR and that they were there to complete a “mission”. They bound the boys’ hands and put them in the back of a black Mahindra truck. At the back of the truck the two boys found more people who had also apparently been abducted by the same men, according to Chekwa’s account. According to the two teenagers, the men were armed with machine guns “like those of the police”.

Leonardo Colher, spokesperson for the PRM in Manica, told Zitamar News that the case was not known to the police,

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adding that the police force does not own a vehicle matching Chekwa’s description. Colher said the only incident they had heard of that day was that the Renamo militia had abducted 15 people, who were later rescued. Chekwa’s attackers also emptied his house of anything of value, including a television, DVD player, three computers, two mobile phones, a printer, a CCTV camera, a digital camera, voice recorders, a fan, MT6,000 in cash, and folders containing various documents. Chekwa’s son and his friend manged to escape their abductors when one of the other abductees in the truck threw a rock at the driver. In the confusion the boys escaped and hid nearby.

Chekwa said he has previously been blamed by local Frelimo officials for causing them to lose the most recent elections in the area, as his radio shows allow citizens to voice their grievances about local politicians. Earlier in 2016 he told Zitamar News that he had been intimidated by local police who were unhappy with his reporting of local clashes between the government and Renamo. Chekwa is also a correspondent for @Verdade, runs a blog, and also works with the Maputo-based Civil Society Support Mechanisms (MASC)

Source: @Verdade/Zitamar News

Mozambique and Malawi consolidate co-operation in the field of defence and security

On Wednesday 7 December, at the end of the 10th Session of the Permanent Joint Commission on Defence and Security between Mozambique and Malawi, the two countries announced that they have adopted the exchange of

information and the speedy implementation of the resolutions as a way to consolidate bilateral co-operation. Speaking at the closing of the three-day meeting, which brought together experts and senior commanders from the armies of Mozambique and Malawi, Atanásio Ntumuke, Mozambican Minister of National Defence and president of the meeting, said that the gathering served to review the current stage of relations in the field of defence and security.

Under the motto ‘For an Increasingly Consolidated Neighbourhood’, the meeting also provided an opportunity for vital information exchange on the political, economic and social situation prevailing in both countries in particular and in the region in general, and concluded that the way forward is consensus between governments and sister nations.

“Our discussions and reflections have led us to conclude that our countries share a common vision that organised crime, terrorism, illegal immigration, trafficking in human beings and money laundering, among other evils, are on the list of threats that our states face. We urge the need to continue our joint efforts to combat such phenomenon”, said Minister Ntumuke.

Meanwhile, Deputy Minister of Defence of the Republic of Malawi and co-chair of the session, Vicente Ghambi, said that the resolutions that came out of the meeting were aimed at solving and removing security threats between the two countries, and should be implemented in full and monitored in order to achieve the desired results.


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Maritime surveillance on agenda in Mozambique – International Maritime Organization

A project to provide a single display maritime surveillance system for Mozambique has been commissioned and officially handed over to the country’s government in Maputo on 1 December. The International Maritime Organization (IMO)-supported project is set to boost maritime situational awareness for all concerned agencies in Mozambique and enhance operational decision making and increase co-operation in dealing with maritime security issues.

The project, funded through contribution by the government of Japan to the Djibouti Code of Conduct Trust Fund, provides maritime surveillance systems including the Global Maritime Distress

Safety System (GMDSS), automatic identification system (AIS), and VHF radios with data link – creating an integrated system for the Mozambique National Maritime Authority (INAMAR), Mozambique Navy, Fisheries, and the Mozambique Maritime Police.

During the launch, IMO’s Kiruja Micheni called on all relevant government agencies to support the concept of a whole of government approach to dealing with maritime issues and to embrace a culture of information-sharing between them to reach their common goal. IMO is the United Nations specialised agency with responsibility for the safety and security of shipping and the prevention of marine pollution by ships.

Source: IMO

CRIME

GRAPH 2: Incident Type per Month

The following graphs and map relate to the political and security incidents in Mozambique

from 01/01/2016 to 18/11/2016.

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GRAPH 3: Incidents per Time of Day

Bolivian woman arrested at OR Tambo en-route to Maputo with ZAR2.5-million worth of cocaine

Customs officials from the South African Revenue Service (SARS) recently arrested four suspected drug mules – including an air stewardess – and confiscated drugs worth ZAR4.2-million at OR Tambo International Airport in Johannesburg.

In a separate incident, a random search of a box at the airport’s mail distribution outlet also saw officials seize ephedrine, an ingredient used in Tik, worth ZAR1.8-million. The box came from India.

In the latest incident, which occurred on Sunday 4 December, a Bolivian woman en-route to Maputo, was arrested after a detector dog and x-ray scanners were used on one of her bags. Four blocks of

a “white powdery substance” was detected. The substance was later found to be cocaine weighing nine-kilograms, estimated to be worth ZAR2,589,000.

Source: African News Agency

Judges say organised crime attempted to capture the State

On Thursday 8 December, the president of the Mozambican Association of Judges (Associação Moçambicana de Juízes, AMJ), Carlos Mondlane, said that organised crime had tried to capture the State in recent years by attacking magistrates defending the country’s justice system.

Mondlane was referring to the April murder of Marcelino Vilanculos, a Mozambican prosecutor, and that of

Should you wish to view the full report and additional statistics on

Mozambique incidents please email [email protected]


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judge Carlos Silica in May 2014 in the heart of the Mozambican capital.

“The judiciary has been attacked through these murders, and organised crime has attempted to capture the State”, said Mondlane.

The last few years, the AMJ president continued, had been marked by increasing threats to the safety of the magistracy, leading them to demand greater protection for the administration of justice from the competent bodies.

“We have discussed this issue in depth, and the conclusions have been forwarded to the police and judicial institutions charged with taking care of the matter”, Mondlane explained.

Mondlane said that the AMJ had this year committed itself to strengthening relations of concord and collaboration with various legal and judicial agents.

Source: O País/Lusa

Prison director accused of facilitating escape

The Mozambican police have confirmed that among the prison staff arrested on suspicion of helping an accused assassin escape from the Maputo Provincial Penitentiary in October is the prison director, Castigo Machaieie.

The spokesperson for the General Command of the PRM, Claudio Langa, told reporters on Tuesday 6 December that Machaieie and two other members of the prison management were among the nine people arrested in connection with the escape.

But Langa declined to give any further details on the grounds that the matter is still under investigation.

According to a press release from the Provincial Attorney’s Office, the nine were detained because there was “proven risk of disturbing the investigations” and because the Public Prosecutor’s Office concluded there were strong signs of corruption and complicity in the escape. The prison authorities had reached the same conclusion.

The man who escaped, Abdul Tembe, is accused of driving the car used by the men who assassinated prominent prosecutor Marcelino Vilanculos on 11 April, in front of his home in the southern city of Maputo.

Vilanculos is believed to have been targeted because he was handling a number of sensitive cases, including the kidnapping of business people, and the subsequent demands for enormous ransoms, sometimes running into millions of US dollars.

Tembe escaped from prison on the night of 24 October. On that night a violent thunderstorm hit Maputo, and the noise of the storm might have made it easier for Tembe to cut through the bars in his cell window without being heard.

Shortly after the escape, Machaieie told reporters that Tembe had somehow acquired a sharp instrument to cut through the cell bars, and then slipped past the prison guards.

Tembe was initially held in the cells of the Maputo Police Command, in the centre of the city, but was moved to the Central Prison, in the suburb of

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Machava, supposedly to protect him, since the other two accused (Amade Antonio and Jose Coutinho), had made threats against him.

This makes little sense, since security at the Police Command is much tighter than at the Central Prison.

Antonio and Coutinho are still incarcerated at the Police Command. According to a report carried last month by Mediafax, they had allegedly been putting pressure on Tembe to change the statements he had made shortly after the trio were arrested.


Traffic police officer handed suspended jail term for beating a man in Xai-Xai

The Judicial Court in Xai-Xai (Gaza Province) has given a traffic police offer a suspended sentence of 20 months in prison and a fine for assaulting a member of the public.

The victim, Caetano Muthombene, a Limpopo Driving School instructor, was assaulted on 24 October 2015 in Xai-Xai city in what the judicial authorities classified as battery.

Muthombene was violently beaten by traffic officer Manuel Fidalgo Vicente Cossa, who allegedly crossed a public highway in an irregular manner and was upbraided by his soon-to-be victim.

According to the judge, the convicted agent “acted deceitfully and with intent to injure the victim, to the detriment of his physical integrity and health”.

The reasons for Manuel Cossa punching the citizen in question were also reprehensible, the court found. “There was no reason to go after a citizen who simply drew his attention to the need for observing rules of the road”, the court said. In the event that the convicted policeman fails to pay compensation to the victim, he will be obliged to serve the jail sentence, the court said.


Cabo Delgado PRM in pursuit of four armed men

The PRM of Montepuez district (Cabo Delgado Province) are still searching for four unidentified men who, last week, evaded arrest after an exchange of fire with the police. The men are said to be armed with an AK-47.

A spokesperson for the local PRM, Márcia Zucula, said that, during the course of last week, the police ambushed the gang (comprising of six men), near the groups hideout in the Mirige neighbourhood.

The armed gang responded by opening fire on the police unit, and two gang members were subsequently shot and killed when the police returned fire. One of the deceased gang members was a FADM soldier. (See Police shoot dead FADM member involved in arms deal - page 79, Rhula Weekly No.159).

According Zucula, the gang was dedicated to armed burglaries. The gang was armed with two AK-47s, which were allegedly acquired through the FADM member, who was stationed at the Montepuez military training centre.


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Three people detained in connection with the murder of Joaquim Malagueira

Two weeks after the murder of Portuguese businessman Joaquim Cavaco Malagueira, the Maputo PRM have announced that three suspects have been arrested in connection with the case.

The entrepreneur, who arrived in Mozambique in 2007, was the owner of Soundlight.

The PRM of Maputo added that: “the evidence indicates that the three individuals were directly involved in the death of Joaquim Malagueira”.

Bernardino Rafael, commander of the Maputo police, said that the arrest warrant for the three murder suspects has already been legalised.

Rafael said that the businessman was murdered by people he worked with who were unhappy with their remuneration.

Malagueira, 65, was tied to a chair and then drowned in a bathtub.

(See Portuguese businessman murdered in Maputo - page 79, Rhula Weekly No.158).

Source: A Bola

Robbers raid Mr Bow’s house in Belo Horisonte – brother severely injured

During the course of last week, a gang of robbers targeted the Maputo home of renowned Mozambican musician, Mr. Bow, stealing goods and severely injuring the artist’s brother.

Mr. Bow’s residence is located in the Belo Horizonte neighbourhood, Boane district (Maputo Province).

One guard was injured during the incident; causing the other guards to flee. The case has been reported to the authorities.

The Bow-Liloca couple were not at home at the time of the incident. Mr. Bow’s brother says that while they were ransacking the house, the criminals constantly asked where the homeowners were, which suggests that the criminals came with the intention of attacking the couple.

This is reputedly not the first time criminals have broken into the house in search of the musicians, on all occasions without success.

Source: Notícias

Teenager narrowly escapes lynch mob

On Sunday 4 November, a young teenager narrowly escaped being lynched to death by an angry mob in the Djuba neighbourhood, Matola, after being caught red-handed stealing from a residence that was under construction.

The teenager was allegedly accompanied by an unnamed neighbour when he was caught breaking the windows of the building in order to gain access to the house.

The adolescent was saved by his family who arrived in time to intervene.


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Six community members arrested for murdering suspected rapist in Manhiça

Six people, comprising of five members of Maluana Community Policing Unit and a block chief, were arrested last week for torturing a suspected rapist to death. The incident occurred in Manhiça district (Maputo Province) when the deceased attempted to rape a woman. According to reports, the would-be rapist allegedly stole the woman’s garments, which he used to brag about his exploits.

Upon learning of the incident, the six detainees accosted the rapist and tortured him with blunt objects, before dragging him by his genitals. The block chief is accused of ordering the Community Police to torture the man. Emídio Mabunda, a PRM spokesperson in Maputo Province, condemned the killing and said that community policing elements must follow the rules that govern their activity.

Source: Folha de Maputo/@Verdade

Man arrested for murdering his colleague in Maputo province

An unnamed man has been arrested by the Maputo PRM in Boane district on charges of murder. The man stands accused of poisoning his co-worker to death in the house where they were employed as domestic workers. According to police reports, the 24-year-old detainee allegedly killed his colleague in a bid to prevent him from informing their boss of his deviant behaviour. The poison was mixed with corn meal and ingested by the victim

Source: @Verdade

Man arrested for abducting and raping a three-year-old child in Cabo Delgado

A 24-year-old man (who identity has not been disclosed to the media) has been arrested in the town of Pemba (Cabo Delgado Province) on charges of abduction and rape. According to the PRM, the incident occurred during the day in the Expansão neighbourhood.

The detainee is said to have found the three-year-old victim playing with other children near his house. The detainee subsequently abducted the child and took her to a deserted area where he raped her before stealing the victim’s earrings. The perpetrator was arrested and the young victim has been returned to the care of her family after receiving medical attention.

Source: @Verdade/O País

Police in Manica crackdown on smuggling

The PRM have seized 2,500-litres of fuel (petrol and diesel) and 100 sacks of cement that were about to be smuggled into Zimbabwe.

The goods were to be taken across the border at Machipanda, in the central province of Manica, in a scheme organised by a group of youths, who fled as soon as they saw the police. They abandoned the cement and the fuel, which is now being stored in the Manica district police command, and in the provincial customs delegation.

The goods were seized in an operation involving the ordinary police and units of the frontier guard seeking to crack down on cross border smuggling.

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The head of the public relations department in the Manica provincial police command, Leonardo Colher, told reporters that in other incidents forming part of the same operation, the police seized large quantities of soft drinks, bundles of clothing and footwear, and two vehicles being used to transport these goods. “This work will continue, because we want to put the brakes on smuggling along the border”, promised Colher.

“Mozambicans take goods into Zimbabwe and vice versa”, he said. “The fuel is taken from the tanks of long distance trucks. They do this business at night, and it’s a business we want to stop. People should use the legal means and pay all the taxes imposed by the State, following the procedures laid down by law”. Nobody has been detained yet, but the police found documents in the two vehicles seized, and believe these will lead them to the smugglers.


Twenty people caught trafficking in medicines

The Mozambican authorities initiated disciplinary and criminal proceedings against 18 health workers and arrested two people over the past year for the theft and trafficking in medicines, according to Health Minister Nazira Abdula.

“These people were held responsible for their acts thanks to the implementation of our strategy to combat the theft, diversion and contraband in medicines”, she said on Monday 5 November at the opening in Maputo of a meeting of the

General Health Directorate. The strategy, she said, involves the collaboration of the Health Ministry with the police, the courts, the Mozambique Tax Authority, and municipal authorities.

Minister Abdula believed that the introduction of a stamp reading ‘For the exclusive use of the National Health Service’ had reduced the diversion of publicly-owned medicines and equipment into private clinics and pharmacies.

Dishonest staff had regularly stolen medicines from public health units and sold them on to the private sector. With the medicines now clearly stating that they are the property of the National Health Service, such theft has become more difficult. “Despite all efforts”, Minister Abdula added, “we are continuing to see discrepancies and theft of pharmaceutical products and medical material”.

During audits, the “discrepancies” noted (and most likely the result of theft) involved a range of medicines including antibiotics, anti-malarial drugs, painkillers, and anti-inflammatory medicines. Minister Abdula urged the inspectors to monitor all these products carefully.

Over the past year, the inspectorate had audited MT160-million (US$2.2-million) in public health institutions, and noted irregularities in private pharmacies which led to fines and recommendations of criminal proceedings in 46 cases, some of which have now been sent to the Public Prosecutor's Office.

Source: Agencia de Informacao de Moçambique/O País

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Governor of Tete catches driver apparently selling fuel

On Friday 2 December, the Governor of Tete Province, Paulo Auade, personally caught a long-distance truck driver illegally selling fuel (diesel) on the public highway, and demanded that measures be taken urgently to stamp out the illicit trade in stolen fuel.

According to a report in Diario de Moçambique, Governor Auade was returning from a working visit to Mutarara district when he saw the driver siphoning the fuel out of his truck’s tank into 20-litre plastic bidons. This hazardous operation was taking place not far from Caphiridzange, in the district of Moatize, where, on 17 November, the theft of fuel from a tanker truck led to a devastating explosion in which 100 people died.

Governor Auade ordered his motorcade – which included several provincial directors and journalists – to stop, and he spoke angrily to the driver. “It’s inexplicable that, less than a month after the tragedy of Caphiridzange, truck drivers are still involved in the illegal sale of fuel”, he declared. “You are the ones who create problems on the roads. So we’re going to speak to your employer, so that measures are taken, because this situation cannot continue”.

Governor Auade insisted “urgent measures must be taken, so that deaths such as those at Caphiridzange, no longer happen in our province”. But the driver, named Sergio Pensar, and employed by the company Transportes Ali, denied that he was selling fuel. He said his truck had two tanks and he was transferring fuel from one to the other, because the vehicle did not do this

automatically. “I came from Beira, and I was taking this cargo to Mutarara”, he said. “But when I got this far, I saw that the fuel in this tank was not enough to reach Mutarara. So I stopped and I asked for bidons from the local people so that I could make the transfer”.

Source: Agencia de Informacao de Moçambique/Diario de Moçambique

PRM requests information from Malawian owners of Caphiridzange fuel tanker

Following the fuel tanker tragedy in Tete Province, police authorities say they are intensifying efforts to identify and apprehend those responsible for diverting the truck to the scene of the explosion in the village of Caphiridzange, Moatize district. These are the two drivers employed by Malawian company Walkers, who have been at large since the incident. Three weeks after the incident, the foreign company concerned has not yet commented on the matter, resulting in the PRM requesting the Provincial Office of Tete to contact Walkers for clarification on the subject.

The information was imparted on Tuesday 6 December by the spokesperson of the PRM General Command, Cláudio Langa, during a press conference. “Since the Malawian company has not yet commented, we have chosen to deploy other means to get clarification on the tragedy”, Langa said. A police team led by PRM commander-in-chief Júlio Jane visited the site of the tragedy in Tete last Thursday. In Caphiridzange, the commander held meetings with the population and community leaders and called for greater vigilance in situations

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that could compromise public safety. Jane demanded greater action on the fuel theft common in the province, where truck drivers frequently divert from their official routes to sell fuel on the informal market.

Source: O País

PRM ensures readiness for the festive season

The PRM of Maputo City have already begun strengthening efforts in order to ensure that nothing unusual happens during the festive season. The guarantee was given to the press by the respective commander of the PRM in the capital, Bernardino Rafael, who stressed that police presence will be intensified at international and provincial passenger terminals, as well as at large supermarkets, places of recreation, beaches, boulevards and all places where citizens congregate in large numbers.

In addition to this measure, the PRM will raise awareness among motorists and pedestrians so as to minimise road accidents during this period.


South African autopsy report also finds that Elly Warren was not killed

As her desperate father in Melbourne continues trying to piece together the last hours of her life, believing his daughter was murdered, a South African autopsy on the body of 20-year-old Elly Warren appears to indicate she did not die a violent death. A fisherman found Warren’s body at approximately 5:00hrs on 9 November outside a toilet block in the tourist town of Tofo (Inhambane Province). Her underwear was below

her knees and it was initially thought she had been raped and killed. However, the South African autopsy results seem to match those of an autopsy conducted by Mozambican authorities.

While the Mozambicans have not released a final report, a preliminary report concluded that Warren had collapsed face-first into the sand and died of asphyxiation. What caused the collapse is unknown. There was speculation in the media that she may have been given some sort of date-rape drug but toxicology reports from South Africa seem to indicate the only substance in her system was alcohol.

The doctor conducting the autopsy in South Africa was unable to get an accurate blood-alcohol reading because her body had been embalmed in Mozambique. Investigations are continuing into how Warren died but her death is no longer being treated as a murder.

A third autopsy was conducted in Melbourne when her body was flown home, and her father, Paul Warren, said he expected the results to be released in February. “I have been told that there is no difference (sic) to the autopsy done in Johannesburg”, Mr. Warren told The Weekend Australian by email.

He said he believed that his daughter had been murdered and authorities in Mozambique were covering up a crime to protect their tourist industry. He has been trying to piece together her last hours in an attempt to establish what happened. “Let’s look at it logically”, he wrote. “We have a very healthy 20-year-old girl. No drugs (minimal) amount alcohol. What she falls in the sand with face injuries and her mouth is full of

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sand. You don’t need to be Einstein to work out what happened here. I have nearly all the pieces to the puzzle. The truth about Elly will come out soon. I do know this. Elly was at a party and left the girls she was with and walked back on her own.

“I am not to (sic) sure what happened next … we think Elly had gone to the toilet block to pee around 50-metres away from the bar. However, she found they were locked at night and went around the back carrying her beer. She placed her beer on the ground and went to go to the toilet but was attacked before she could get a chance to pee because her bladder was found to be full … Elly was not raped but that was there (sic) intention”.

However, both the Mozambican and South African reports concluded Elly Warren had not been raped. A source

familiar with the case said: “I think the Mozambicans may have got it right”. He said her only visible injuries were light abrasions on the nose and lips, which could have been caused by her body weight on the sand. “Perhaps she may have been intoxicated and maybe attempted to have a pee and has fallen forward into the sand, and maybe passed out and started inhaling sand”, the source said.

“Then again it could have been some sort of seizure, but nothing like that was detected. She was a fit young lady, and she is quite a big girl, and if that was an attempted rape there would be significant signs of a struggle … which there wasn’t”. Mr. Warren said he did not know whether a coronial investigation would be held in Australia.

Source: The Australian

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HUMAN RIGHTS, SOCIAL DEVELOPMENT AND NGO’S

Mozambique declared free from cluster munitions

Approximately 1.3-million square metres, 144 cluster bomblets, 50 antipersonnel mines and 23 UXOs: Norwegian People’s Aid is proud to announce that it has finished clearing cluster munitions in Mozambique. This occurred only a year after Mozambique was declared free of landmines in September 2015.

Partaking in Mozambique achieving this key milestone is very gratifying. A safer Mozambique free from cluster munitions contamination has always been the apex of the group’s commitment, says Programme Manager for Norwegian People’s Aid in Mozambique, Afedra Robert Iga.

Mozambique signed the Convention on Cluster Munitions on 3 December 2008, ratified it on 14 March 2011 before it entered into force on 1 September 2011. Assenting to the convention also meant that Mozambique had committed itself in ensuring that it surveys and clears all cluster munitions contaminated areas in its jurisdiction.

In the wake of successfully fulfilling Article 5 of the Mine Ban Treaty last year, Mozambique embarked on an expeditious programme in an attempt to get rid of cluster munitions remnants before December 2016.

With the support from the Norwegian People’s Aid (NPA) and funding from the UNDP, Mozambique implemented a comprehensive cluster munitions remnant survey (CMRS) in 2015. The survey covered four provinces of Gaza,

Manica, Tete, and Niassa, which had a history of aerial bombardment during the periods of war in the country, Iga explains.

According to Iga, the CMRS confirmed that there were cluster munitions in 10 areas in the provinces of Manica and Tete. Gaza and Niassa were found to have no contaminations. The survey covered a total of four provinces, 21 districts and 89 communities and the area confirmed contaminated measured approximately 800,000 square metres.

At the request of the Mozambique National Demining Institute (IND) NPA undertook clearance activities in 2016, thanks to funding from the Norwegian Ministry of Foreign Affairs. This has resulted in the release of nearly 1.4-million square metres through surface and subsurface clearance techniques, and the destruction of a total of 144 Rhodesian Cluster ALPHA Bomblets (892-kilograms), 50 antipersonnel mines, and 23 UXOs.

The involvement of NPA in the CMRS and clearance in Mozambique was a continuation of NPA’s already existing footprint in the country that spans over 20 years, partaking in mine clearance activities.

The completion of cluster munitions clearance in Mozambique by NPA, coupled with previous clearance efforts from other demining partners like APOPO, HALO Trust and Handicap International means that the country has formally taken all necessary efforts in clearing all known cluster munitions contamination in its jurisdiction, and hence achieving her obligation under

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Article 4 of the Convention on Cluster Munitions well ahead of its 2021 deadline.

“We are yet again proud that our people have a safer country and they are able to cultivate their land without the fear of explosive remnants of war”, said the Director of the National Demining Institute in Mozambique, Alberto Maverengue Augusto, in a comment.

Cluster munitions in Mozambique:

Cluster munitions contamination in Mozambique is a result of extended periods of conflict in the late 70s between the Mozambican government and the Zimbabwe African National Liberation Army (ZANLA) against the then Rhodesian Governments in Zimbabwe and South Africa.

Cluster munitions and a variety of ammunition were used by warring factions in the western provinces of Mozambique.

The cluster contamination in particular is a result of a number of successive conflicts over the period including; 1976 Rhodesian “Operation Dingo” against ZANLA forces in Manica Province, 1977 Rhodesian “Operation Snoopy” against ZANLA forces in Manica and Tete provinces and 1979 Rhodesian “Operation Ulric” against Mozambique forces and ZANLA forces in Gaza Province.

During all these conflicts, cluster munitions were used especially in the border provinces west of Mozambique.

Source: Norwegian People's Aid/Relief Web

Students in Niassa pledge to stop attending school until Renamo is in power

A children’s rights organisation in Niassa Province has reported that some parents in the area are stopping their children from going to school because they are waiting for Renamo to take over governance of their province.

The parents have issued an ultimatum: either Renamo starts ruling or their children will not attend classes.

Parents and guardians are not providing alternatives to students in the district of Majune, where children are also refusing to go to school on their own accord.

This is according to Laurentino Roupene of the Good Hope Friends of the Children Association (ACABE), an organisation that defends the rights of children in the northern province.

“In the villages where Renamo dominates, the children do not study”, he says.

“They say ‘we are waiting for our president, Afonso Dhlakama, for when he comes to power – that is when we will have classes’. And, in those villages, the classrooms are ‘left to the flies’”.

The district of Majune is considered to be a Renamo stronghold.

Support for the largest opposition party in Mozambique is greater in the small villages and administrative posts.

Frelimo schools:

Elídio Lule Sacassa, who lives in a Majune district village, says, for

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example, that many parents forbid their children from attending school because they are “Frelimo schools”.

“The dropout rate in the district of Majune is alarming. Also at the administrative post of Nairobi, in the locality of Nambilagem, where most of the residents support the opposition”, Sacassa explains.

“When the school board goes to the houses to get the children, the parents forbid it. They claim that the school is a ‘Frelimo school’ and say that, because they belong to Renamo, they do not want their children going there”.

Deutsche Welle Africa contacted the Education, Youth and Technology services in the district of Majune, but they declined to comment on the matter.

Sensitise communities:

ACABE’s Roupene promises to enhance community awareness campaigns “next year”.

Previously, he explained, the association operated “in some areas where these policies were practiced, and, with the involvement of ACABE, students began to return to school”.

According to Roupene, the worst affected schools are located in Nairobi, Namilagem, Luambala and Chimpupu.

“The situation is currently worse in Insilo, Megualo and Matucuta, where there is competition between political parties”, he concludes.


Southern Africa can avoid climate strife with water agreements

The Chicamba Dam in north-west Mozambique is critical to the water supply of three large cities. Fed by the Muene River, it also provides a livelihood for hundreds of fishermen as well as the small industries that support the local tourists that flock to the dam when it is full.

But the river and dam have become increasingly polluted, with locals pointing the finger at the source of the river: the Zimbabwean city of Mutare some 50-kilometres away to the west.

A dumpsite in Mutare’s Nyakamete industrial area sits on the spot where the Muene starts. Waste from industries, clinics and homes in Mutare gets dumped at the site. The up to 50° heat in that city helps break down and decompose the waste, so chemicals and other liquids seep into the river.

By the time it reaches Chicamba Dam, it is so polluted that locals blame it for cholera outbreaks and sudden deaths in the fish population.

Authorities in Mozambique’s Manica Province, which contains the dam, set up a task force in 2009 to investigate the cause of the cholera and other water-related health problems. It concluded that Mutare’s dumpsite was to blame, and asked that city to fix the problem. Mutare’s city council said it didn’t have the money to find another way to dispose of the problem, so effectively ignored the complaints.

But the situation has intensified with the ongoing drought. Less water in the river means a higher concentration of

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pollutants. Low levels in the Chicamba Dam also mean that old concentrations of chemicals – which normally sink to the bottom of large water bodies – have mixed into the little water that is left.

That ongoing drought – the worst in southern Africa in 35-years – has created all sorts of similar conflicts. Mozambique has lodged complaints with the Southern African Development Community (SADC) about polluted water from South African mining killing crocodiles and fish. That water has also killed animals in the Kruger National Park.

This is a problem in a region where rivers form borders and care little for political considerations. The colonial divvying-up of the region in the late 1800s saw rivers become convenient borders. Twelve SADC states share 21 river basins, with most of these crossing more than two countries.

Cases such as that of the Muene River are often left unresolved. If bilateral discussions do not work, states lodge their complaints with the SADC secretariat. It then recommends that the offending party stop the offending activity. But there is nothing in the way of censure.

That lack of political intervention can create decades of conflict. Botswana and Namibia still trade hostile words over the Sedudu Island, on the border between the two countries and Zambia. Stuck in the middle of the Chobe River, which then flows into the Zambezi River, its legal status was left in a grey area after the 1890 Heligoland-Zanzibar Treaty. This treaty between Germany and Great Britain settled border disputes

between their colonies, but gave little in the way of detail.

It set the Chobe River as the border between Botswana, Namibia and Zambia. Both countries claimed the river, and deployed soldiers. Several firefights ensued in the 1990s, without SADC being able to resolve the dispute. Botswana went to the International Court of Justice, which ruled in 1999 that the island belongs to the country.

But the current drought has rekindled the conflict. With less water in the Chobe River, Namibian fishermen have been forced to cast their nets further towards the Botswana side and Sedudu Island.

Namibia still claims access. Several Namibians have been shot by the Botswana army in recent years, with 14 arrested last year for illegal fishing. Botswana – a landlocked nation – now has small naval patrol vessels to maintain its control over the river.

That same 1890 treaty has created over a century of deadlock between Namibia and South Africa. It set their border as the Orange River, which flows between the two countries for 600-kilometres. South Africa holds that the border is on the high-water mark on the Namibian side, which means that country cannot use the water.

In an arid region with virtually no rainfall, that means large tracts of irrigated farmland and vineyards on the South African side of the Orange and little on the northern, Namibian, side.

Namibia argues that the border is in the middle of the river, according to international best practice. But the

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country was a South African colony for 60 years and relies on its larger southern neighbour for trade and food imports, so has little political capital to force its way.

The dispute has, however, driven a shift in the water politics of southern Africa. In the past the country with the strongest army and economy would do what it would with water. That’s why the Limpopo River, which flows through South Africa, Botswana, Zimbabwe and Mozambique, has 44 dams with 26 of those in South Africa.

Stuck without a say in the Orange River, Namibia pushed for the creation of the Orange-Senqu Commission in the early 2000s. This brought South Africa, Botswana, Namibia and Lesotho together in a body that would discuss how water is shared along the 2,000-kilometre long river.

With a crippling drought wiping out crops and threatening its capital of Windhoek with shortages, Namibia has tried to get access to more water. But it has failed. In practice, South Africa uses its economic clout to keep the status quo.

That status quo – and hegemony over water resources – has been decades in the making. Each agreement that the country signs on transboundary water sharing leans in its favour, ensuring more water can be used on the South African side.

To ensure enough water comes in, South Africa has spent three decades involved in Lesotho’s politics to ensure the security of the Lesotho Highlands Water Scheme. This has seen dams built in the mountain kingdom to collect

its bountiful rainfall. That then flows to Gauteng – South Africa’s industrial heart.

But the scheme almost never existed. Negotiations in the early 1980s to allow construction to go ahead were stopped when Lesotho’s prime minister, Chief Leabua Jonathan, turned to the West for aid, something the isolated apartheid regime did not appreciate. The scheme was put on hold.

But a coup in 1986 removed the prime minister and the highlands scheme treaty was signed 10-months later. People in Lesotho still complain about its terms, which provide cheap water to South Africa when water is the most valuable resource in the region.

Two years after the scheme started working, in 1998, a coup in Lesotho threatened the new water resource. The country’s Prime Minister, whom the army had turned on, asked SADC for help. Botswana and South Africa immediately mobilised 1,500 soldiers.

Their stated goal was to “create a safe environment”, through “securing and controlling” several key facilities in Lesotho. These included “power and water supply facilities” – the highlands water scheme. Katse Dam, the centrepiece of that scheme, was the setting of intense fighting with several soldiers killed.

That action has been used as a case study for water relationships between big and small countries. South Africa has consequently been accused of using its military to secure its water supply. International publications at the time dubbed the contested intervention a “water war”.

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But a similar crisis this year signalled the changing nature of SADC water and regional politics. With a drought crippling the region and South African dams dropping to record lows, South Africa intervened politically to settle the dispute.

One of the threats raised during the crisis by opposition parties in Lesotho was for a renegotiation of the price at which South Africa buys water from the highlands scheme. This threat died out with the settlement.

South Africa’s armed forces have used interventions like Lesotho to create scenarios that are specifically focused on securing water resources. Climate projections by the UN’s Intergovernmental Panel on Climate Change (IPCC) and local bodies such as the Council for Scientific and Industrial Research (CSIR) warn that competition for this one resource will drive conflict in the future.

The IPCC has said that decreasing rainfall and the changing climate will be a “multiplier” for armed conflict in the region. The CSIR has warned as recently as this year that more attention needs to be given to “transboundary water agreements” so that there are tools in place when “water scarcity forces communities to compete for resources”.

The current drought has seen this happen in isolated cases. Several instances in South Africa, Zimbabwe and Mozambique have seen people killing each other for access to scarce water resources. The UN’s Food and Agriculture Organisation says 40-million people are “acutely food insecure” in southern Africa.

The two to three-year drought is being heralded as a window on the near future. The IPCC predicts that temperatures in the region will be up to three degrees hotter by 2050. That will dry up rainfall, which will come in short and violent storms that don’t seep into the ground, and instead evaporate.

History says that this will drive violent contestation of water resources. But an increasing maturity in water sharing agreements in southern Africa could ensure this future does not come to pass.

Source: Mail & Guardian

Farmers in the southern region receive 20-tons of seed in order to cope with the drought

More than 24-tons of seeds were distributed to farmers in eight districts of the provinces of Maputo, Gaza and Inhambane. The initiative is aimed at alleviating the suffering of families affected by drought in the southern regions of the country.

The seeds include beans, corn, kale and cabbage.

Many subsistence farmers in the area complain that they spent money on buying seeds earlier in the year, but they lost out when those seeds failed to germinate due to the drought.

The new seeds were delivered by a group comprising of oil and gas companies that are active in the area.

“Here in Moamba we delivered 3.7-tons of seeds, but we have seeds for the other districts of Maputo, Gaza and Inhambane”, said the representative of ROMPCO, Benjamim Chalenge.

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The drought has put approximately 26,740 families (or 120,330 people) at risk of food insecurity in Maputo Province alone.

Water scarcity has affected several areas of the province, and the impact has been felt by 47 communities in Maputo (5,300 families or about 26,500 people) of which 3,625 are in Moamba.

Source: O País

China to co-operate with Mozambique in media sector

The Chinese Ambassador to Mozambique, Su Jian, has expressed his country’s readiness to continue to promote professional exchanges between the two countries in the area of social communication.

Ambassador Jian’s comments came during a courtesy visit to the Mozambican Information Office, GABINFO, with the objective of becoming better acquainted with the institution’s workings and responsibilities.

“We exchanged ideas with the director of GABINFO to see if we could expand the space for exchanges and co-operation between the parties, because the media sector plays a very important role in strengthening friendly relations and co-operation between China and Mozambique”, he remarked.

The diplomat stressed that bilateral co-operation between Mozambique and China covers all areas, but is still in its infancy in the media sector.

As a way of stimulating co-operation, China annually invites journalists and reporters from Mozambique to take part

in professional training courses in China.

“We have distributed materials to media in Mozambique, and Mozambican television, national radio, Jornal Notícias and some private agencies have already benefited from China’s support in technical and technology resources”, the diplomat said.

He said that China would continue to contribute to the development of Mozambique.

GABINFO Director, Emília Moiane, said that the visit was a great opportunity to promote collaboration between the parties and support the media as a whole.

“As a result of this visit, we will take steps in support of the People’s Republic of China for Mozambique. This support has taken various forms, and we want the media to have opportunities as well”, she said.

Source: Rádio Moçambique

Public prosecutor fights child trafficking in Inhambane

There are more children recorded leaving Inhambane in search of better opportunities than in any other province.

However, according to Mozambique’s Attorney-General’s Office, many of these children end up falling into the hands of human traffickers.

The Attorney-General’s Office is now promoting a campaign to raise community awareness about trafficking and the sexual abuse of minors in Inhambane.

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Many children in the southern province are subjected to sexual exploitation and abuse, especially in rural areas, their families often deceived with false promises of employment and access to education and healthcare.

According to the Deputy Attorney-General of Mozambique, Amabelia Chuquela, “they are children who go out looking for [better] living conditions, especially in the city of Maputo”.

However, she adds, they are often “sexually exploited, exploited as child labour and even forced into prostitution”.

To try to combat the problem, the Attorney-General’s Office of the Republic of Mozambique has a campaign against trafficking and sexual abuse of minors, launched about a year ago.

So far, 34 adolescents have been recovered in the city of Maputo. They left Inhambane lured by false promises

of employment and ended up being victims of child prostitution.

The Women’s Forum in Inhambane is fighting the same battle, activist Esmeralda Eugénio explains, and has run workshops “in communities, schools and markets”.

“We explain the law so that women know their rights and how to protect themselves if they find themselves in situations of this kind. Our girls need protection and information counts for a lot. Something happens to us and we don’t know who to turn to”, she says.

Chuquela emphasises the need to raise awareness among communities “not only at the level of prevention and sensitisation” in schools, but also “to conduct operative work at the police level” so as to “strengthen their ability to detect possible cases of trafficking in persons, especially children”.


WILDLIFE AND ENVIRONMENTAL PROTECTION

Government launches sustainable development programme

The National Sustainable Development Programme (PNDS), an initiative that aims to promote and regulate the sustainable use of natural resources, land organisation and environmental management, was officially launched in Bilene (Gaza Province) on Thursday 8 December.

The initiative was launched by the Minister of Land, Environment and Rural Development, Celso Correia, during the

sector’s Second Coordinating Council in the Praia do Bilene municipality.

Minister Correia explained that the pioneering and innovative programme has a portfolio of projects with a 15-year horizon expected to improve the income of the rural population by reducing poverty in rural areas by up to 45%, guarantee access to drinking water for 15-million people, and expand bioenergy generation to 4,000MW by implementing renewable energy systems.

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The construction of 1,500-kilometres of tertiary roads, bank coverage in all districts and access to land by registering five-million occupations is also foreseen, as is increasing the country’s elephant population to 17,500 individuals and reducing carbon dioxide (CO2) emissions by 72.8-million tons per year.

“This is a response to the challenges of the National Rural Development Strategy 2007-25, and aggregates all ongoing rural development initiatives in the country with a view to better plan current and future actions in the light of rural development”, Minister Correia said.

He pointed to the recent launch by President Filipe Nyusi of the ‘One District, One Bank’ initiative, intended to extend bank coverage to all districts in the country.

Investment in the improvement of infrastructure at the rural level, the construction of some 400-kilometres of roads, the rehabilitation of five rural markets and supporting 16,712 local producers, of whom 8,468 are women, are other examples from the programme.

Minister Correia added that his Ministry reaffirmed its commitment to managing Mozambique’s land and natural resources harmoniously and efficiently, and on Thursday launched a new ministry website in an initiative aligned with the government’s programme to expand access to information.

Source: Notícias

Poachers shot and killed in Limpopo National Park

An unspecified number of poachers were recently killed in the Limpopo National Park (NLP), Massingir district (Gaza Province), following a gunfight with officers from the environmental protection unit. Three poachers managed to escape and their whereabouts are currently unknown.

The poachers were ambushed by the police unit while attempting to slaughter animals in an area known to house rhinos and elephants. The park’s inspectors recovered a firearm and various ammunition.

The police have since assured the media that investigations are underway aimed at identifying and arresting the three remaining members of the gang.


Buffaloes slaughtered in Mágoè, near Cahora Bassa reservoir

With the help of their dogs, the population of Magoe drove 59 buffaloes to a muddy area of Cahora Bassa’s reservoir (in Tete Province), immobilising them there.

Savana newspaper writes that, once the animals were immobilised, the population “massacred” the buffaloes with spears and sticks and removed their meat.

The slaughter of the animals was witnessed by officials of the Mozambique Safaris company, who were unable to intervene.

Source: Folha de Maputo/Savana

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Illegal timber exports halted in Nacala Port – 1,200 containers of logs on their way to China

The Mozambican authorities have seized 1,200 containers of logs (approximately 40,000 cubic meters of wood in total) in the northern port of Nacala before they could be exported illegally to China. This is the largest single seizure of illegal timber in Mozambican history, according to Olivia Amosse, director of the national agency for environmental quality control in the Ministry of Land, Environment and Rural Development. Amosse led the team that supervised the seizure. The wood seized came from a variety of tree species (chanfuta, blackwood and ironwood).

The containers belonged to six unnamed entrepreneurs and were reportedly destined for China. Amosse said that the owners of the wood had been unable to show any documents proving that the planned export was legal. She calculated that, had the

export gone ahead, the Mozambican State would have been swindled out of more than MT60-million (about US$828,000). This is the latest in a string of attempts to export timber illegally from Nacala, often with the exporters making false declarations about the contents of their containers. It is possible that the exporters involved are rushing to try and move logs out of the country before the new law, banning all exports of logs, takes effect on 1 January. Last month, the government suspended for two years the issuing of any new logging licences. This, plus the ban on log exports, are moves intended to put a brake on deforestation.

Mozambican forests have come under severe pressure from logging, both legal and illegal, particularly in the central provinces of Sofala, Manica, Zambézia and Tete, and in Cabo Delgado in the north.

Source: Folha de Maputo/Agencia de Informacao de Moçambique/O País

http://www.focus-africa.org

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HEALTH

Nacala Urban Health Centre, receives ambulance

On Wednesday 30 November, the Municipal Council of the port city of Nacala delivered a new ambulance to the local Urban Health Centre, the oldest health unit in the region.

The event was led by the president of the Municipal Council and witnessed by heads of the health sector and heads of the two administrative posts of the city.

The delivery of the ambulance is aimed at improving access to primary healthcare for the residents of Nacala-Porto, and more specifically the transfer of patients who need urgent treatment.

The ambulance will be available 24 hours a day, and a phone line has been opened to request the services.

The president of the municipality of Nacala-Porto called for the ambulance to be well cared for, so that it may serve the area for a long time to come


Mozambique registers 154,000 new cases of tuberculosis in 2015

Mozambique is one of 30 countries with the highest rates of tuberculosis, and in 2015 it registered 150,000 new cases of TB.

Tuberculosis is a global public health problem which, in 2015, killed more than 4,000 people a day worldwide.

More than 900,000 cases of TB are detected per year worldwide. The disease is a major problem in

Mozambique, which is on the list of the 30 countries with the highest rates of tuberculosis. Last year alone, more than 150,000 new cases were detected.

In a bid to create an effective regional response to tackle tuberculosis and other pulmonary diseases, an initiative was launched on Wednesday 7 December, which will benefit people affected by tuberculosis in Mozambique, Malawi, Zambia and Lesotho.

The programme will last for five-years and is supported by the World Bank and civil society organisations in the area of health in the beneficiary countries.

Miners and HIV/AIDS sufferers are the most vulnerable to TB.

In 2015, of the 2.7-million cases worldwide, 760,000 were reported in the mining sector in southern Africa.

The initiative is being carried out under the motto: ‘United to End Tuberculosis’.

Source: O País/Folha de Maputo

Blood shortage for Caphirizanje victims, particularly O Negative and B Negative – Tete hospital calls on donors to come to the rescue

The provincial health authorities in the western province of Tete say they are short of blood needed to save the lives of the victims of last month’s deadly oil tanker explosion in Caphirizanje, in the coal-rich district of Moatize.

The explosion has so far killed more than 100 people and injured many others, including children and pregnant women.

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Doctor Lidia Cunha, director of the Tete provincial hospital, the largest health unit in the province, says 28 victims are still in hospital, five of which are in a serious condition.

She said the hospital was short of blood, particularly O Negative and B Negative. If this blood is not donated, the patients with serious burns run the risk of dying, she said.

She calls on blood donors and well-wishers to come to the rescue of the needy patients.

“We are facing difficulties. We have done all we could to get blood donors, particularly in these blood groups. We urge those who know their blood groups and others to come to the hospital and help save lives. We have patients of these blood groups who are badly in need of your support. There’s a need for everyone to help”.

Source: BBC/José Tembe

END