Defense minister M'tumuke helped launder Privinvest bribes, evidence shows; US asks South Africa to halt Chang’s extradition during legal review

Welcome to Zitamar’s daily Mozambique briefing for 31 May 2019

Welcome to a free edition of the Zitamar Daily Briefing, bringing the biggest Mozambique news to our subscribers every day.


Agenda:

  • Today and tomorrow: Donor Conference in Beira aiming to raise $3.2bn for post-cyclone reconstruction


The latest from Zitamar News:

Defense minister M'tumuke helped launder Privinvest bribes, evidence shows
The current minister of defence helped a secret service officer launder $1 million of bribes received from Privinvest, according to Mozambican prosecutors' case



The best of the rest:

  • US asks South Africa to halt Chang’s extradition during legal review (Daily Maverick)

  • Insurgents kill up to 15 in attack on truck in Cabo Delgado (Carta de Moçambique, mediaFAX, Lusa)

  • Vale-Mitsui’s Nacala line shifts $1.1bn offshore (A Verdade)

  • Cashew nut production increases, but nuts are the worst in Africa (O País)

  • Chinese lead the number of foreign citizens requesting to work in Mozambique (Carta de Moçambique)

US asks South Africa to halt Chang’s extradition during legal review (Daily Maverick)
The US has formally asked the South African government not to extradite former Mozambican finance minister Manuel Chang to his home country while the US is seeking a legal review of Pretoria’s decision — emphasising that “US extradition law allows for Chang to face justice in both countries – first in the United States, then in Mozambique”, the US Embassy spokesman in Pretoria Robert Mearkle said. Mozambican law does not offer the same provision.
Assuming Chang is still in detention in South Africa, a new justice minister — appointed as part of President Cyril Ramaphosa’s new cabinet on Wednesday — could review the decision, particularly in the light of legal opinion that Manuel Chang probably will enjoy immunity once he sets foot on Mozambican soil again. The SADC extradition protocol expressly says that immunity from prosecution would constitute “mandatory grounds for refusal to extradite.”

Insurgents kill up to 16 in attack on truck in Cabo Delgado (Carta de Moçambique, mediaFAX, Lusa)
At least nine people were killed and more injured in an attack on a truck travelling by road in Quiterajo, Macomia district, on Tuesday 28 May. The truck was carrying eight military personnel, of which two were killed. Varying reports talk of explosives being used to stop the truck, and of soldiers fleeing the scene when faced with armed insurgents.
Meanwhile, national police commander Bernardo Rafael announced yesterday that Mozambican police are searching for a Tanzanian named Amisse Bacar who Rafael alleged has been recruiting youth in Niassa province for the Cabo Delgado insurgency.
The name of the Tanzanian suspect, which is probably spelled ‘Hamisi Bakari’ in his home country, is very common in Tanzania, so it is not clear exactly who police are looking for.
The pickup truck that was attacked on Tuesday belonged to Bacar Faque, a man who is in detention on allegations that he is a member of the insurgency.

Vale-Mitsui’s Nacala line shifts $1.1bn offshore (A Verdade)
The Nacala Integrated Logistics Corridor (CLIN), operated by Brazil’s Vale and Japan’s Mitsui, has shifted $1.1 billion to Abu Dhabi-based subsidiaries and cut its tax paid to Mozambique by 4% to $6.7 million in Q1 2019, A Verdade reports — having analysed Balance of Payments data from the Bank of Mozambique. CLIN did not comment for the story and does not publish its financial statements, despite that being a legal requirement in Mozambique, the paper said.
Abu Dhabi is a commonly-used tax haven for companies operating in Mozambique, thanks to a double taxation treaty between the two countries. It may also have been seen as a better jurisdiction than Mozambique to house an entity which borrowed the project finance from international lenders for the rehabilitation and extension of the line which takes Vale’s coal to the export terminal at Nacala A Velha. This situation means UAE is listed as one of the biggest foreign investors in Mozambique.

Cashew nut production increases, but nuts are the worst in Africa (O País, AIM)
Mozambique’s cashew nut sales have increased to 130,000 tonnes per year over the last five years, from 90,000 tonnes per year in the preceding five years. But the Institute for Cashew Development, INCAJU, said Mozambique needs to improve the quality of its processed nuts, which are the worst in Africa, even though the quality has improved slightly over the last five years.
Cashew exports earned Mozambique about MZN 5 billion meticais ($81m) over the last seven months, according to data released on Wednesday. Processing capacity has grown from 30,000 tonnes per annum to 70,000, with the country’s 17 plants employing around 17,000 people. But half the cashew nuts Mozambique exports are raw, and are processed in countries such as India or Vietnam.

Chinese lead the number of foreign citizens requesting to work in Mozambique (Carta de Moçambique)
Mozambique’s migration services received 469 work visa requests in the first quarter of 2019, with Chinese nationals leading the way with 133 requests, or 28% of the total.  However, India leads the countries with the most work permit requests approved by SENAMI, with 132, while only 47 Chinese requests were approved, followed by 30 for Pakistanis.
These figures give the lie to the perception, common among Mozambican elites, that the Portuguese are the main group seeking employment and local citizenship — and taking jobs from Mozambicans.


Company Announcements

  • Troubled sugar producer Tongaat Hulett says it expects to publish results for the year ended March 2019, and its revised results for the previous year, by October 2019. The company says it is “committed to selling certain assets”, and has obtained independent valuations of its various businesses, including in Mozambique.


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