Mozambique 5 April: Just when you thought it was safe to go back in the water...
Good afternoon. One of these days, there will be a Zitamar Newsletter which does not mention EMATUM. But today is not that day.
Over the weekend, journalists from the Wall Street Journal reported that Mozambique took out an extra $787 million in debt from Credit Suisse and VTB that it spent on undeclared naval equipment - almost doubling the trouble Mozambique is already in with foreign creditors. We wrote last Tuesday that there are “reasons to be cheerful about the outlook for Mozambique’s economy.” We were wrong.
FOR MORE, SEE: Mozambique ‘tuna bond’ scandal almost twice as big as thought – WSJ
Even without the debt taken out by ProIndicus - a name which, if it is new to you today, will surely become familiar over the coming months - credit rating agency Standard & Poor’s judged Mozambique’s EMATUM restructure to constitute an act of default. It remains to be seen what effect the ProIndicus revelations will have on the attitude of the IMF and Mozambique’s international donors, with whom relations appeared to be getting back to normal after the shock of EMATUM.
MORE HERE: EMATUM restructure means Mozambique has defaulted, says S&P
In her book on Joseph Mobutu, the Zairean dictator for whom the word ‘Kleptocrat’ was coined, writer Michela Wrong makes the point that for all his brutality, the fact that he saddled his country with billions of dollars of debt while failing to combat poverty arguably constitutes the biggest and most serious violation of his people’s human rights. As Mozambique faces up to at least a decade of a major chunk of its annual budget being diverted to pay off not one but two opaque arms deals, one wonders whether Mozambicans might come to the same conclusion about the men who were in charge in 2013: President Armando Guebuza, Finance Minister Manuel Chang, and Defence Minister Filipe Nyusi.
The justification, we should add, is that Mozambique’s burgeoning offshore oil and gas industry - on which the country is now more reliant than ever - needs protection. Today Zitamar reports on a key appointment made to the national oil company, ENH, which will has a stake in all petroleum licences in Mozambique .
FOR DETAILS: Old hand to advise Mozambique state oil and gas company
Potential bidders are facing a tight deadline to express an interest in a consultancy contract on a new higher education facility to be built in Nampula. The project is being financed by an Arab development bank and aims to boost skills in agriculture.
SEE: Consultants sought for Arab Bank-financed Mozambique construction project
As of today, you will have noticed, you need to buy a subscription to Zitamar News to be able to read our stories online - with the odd exception (like yesterday’s story on ProIndicus). This newsletter, however, will remain free for the time being - so there is no need to unsubscribe.
Moreover, we are extending our special offer of a £500 annual subscription until the end of this week after an initial teething problem with our subscription system. This issue has now been resolved. The special offer will now end on the evening of Friday, 8 April.
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Let’s hope for better news this week. But whatever the news is, Zitamar will continue to give it to you straight.
Have a great week.