Mozambique must be a partner that respects decisions at international level – Maleiane

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Mozambique must be a partner that respects decisions at international level – Maleiane

2:43 CAT | 14 Jun 2019

File photo: Voa Portugues

The Mozambican Finance Minister told Lusa on Wednesday that the country must respect the decisions taken at international level, and that it was still considering how to act after the ruling nullifying the loan and state guarantees to Ematum.

“What we are doing is to see what steps we have to take so that Mozambique is, in fact, considered a partner that respects the decisions at an international level,” Adriano Maleiane said in an interview with Lusa on the sidelines of the Annual Meetings of the African Development Bank (AfDB), which ends today in Malabo, Equatorial Guinea.

Asked whether he thinks that the ruling of the Constitutional Council declaring null and void the loan and state guarantees affects only the bonds issued by state company Ematum, or also covers sovereign debt issued by the state, he responded: “Decisions are mandatory, and we are working to see what implications this can have in the agreements that the Republic has with the outside [world]”.

“We have to comply with the decision and see how we position ourselves so that the state does not have even greater problems than it might have. This is what we are doing. Our intention is to understand what we do with the agreement in so far as the state is involved, and this is what we have to see,” he added.

The minister did not explicitly say that the government intended to maintain the process of restructuring sovereign debt, whose agreement with creditors was announced four days before the Constitutional Council issued a ruling in which it considers null and void the state guarantees covering the Ematum loan, but he also did not say that the intention was not to pay the sovereign debt that was issued.

“The decision in this ruling is about Ematum, and then [the judges] said the source of that debt and that they consider it, for all purposes, null and void. We are realising the impact of this on everything that happened, because this is bringing us back to six years ago, and everything that has been done, according to the ruling, has to be considered non-existent.”

“The government respects the institutions and their independence, the decisions are mandatory and binding, and I cannot be reticent about it,” he said.

The Mozambican Constitutional Council declared null and void the loan and sovereign guarantees granted by the state worth US$726.5 million (EUR 646.7 million euros) to state company Ematum on 4 April.

In the ruling, following proceedings initiated by the Budget Monitoring Forum, a group of civil society organisations with two thousand subscribers, the judges declared “the nullity of the acts inherent to the loan contracted by Ematum and the respective sovereign guarantee granted by the Government, in 2013, with all the legal consequences”.

In July 2017, the applicants requested the declaration of unconstitutionality of the Ematum loan, a public company that benefited from the Mozambican state’s hidden debts, a dossier the subject of judicial investigations in both the United States of America and Mozambique.

The decision came four days after the government announced it was negotiating to begin paying creditors.

Source: Lusa