Covid-19: More than 26,000 workers in the extractive industry have their jobs at risk in Mozambique

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Covid-19: More than 26,000 workers in the extractive industry have their jobs at risk in Mozambique

1:22 CAT | 29 May 2020

File photo: DW

The Confederation of Economic Associations of Mozambique (CTA), the country’s largest employers association, announced yesterday that more than 26,000 jobs in the extractive industry were at risk as a result of the Covid-19 pandemic.

“About 85 small and medium-sized [companies] linked to the extractive industry have completely suspended their activities due to the temporary suspension of contracts and, consequently, 26,350 jobs may be at risk if the financial situation of the companies worsens,” vice president of the CTA’s mineral resources sector Chivambo Mamadhussen said.

According to the CTA, more than 500 SMEs in the mining industry are affected by the pandemic, 160 of which have recorded a “significant reduction in revenue”, corresponding to an estimated loss of around US$12.6 million.

Among those worst affected, the CTA highlighted the situation of small and medium-sized companies providing services to the consortium led by the French company Total, which will exploit gas in Area 1 of the Rovuma basin in Cabo Delgado, in the north of the country.

After the discovery of coronavirus cases, Total was forced to reduce work to a minimum, but 415 essential workers (about half of the total) remained on site, according to Ministry of Health figures.

“With the main markets for the products of this industry closed and international trade stagnant, the fall in demand in the sector up until May 2020 is significant,” the CTA said, adding that the costs of companies had increased between 30% to 50% as a result of Covid-19 counter-measures.

In addition to making entry visas more flexible, the CTA proposed a dialogue with the government to assess the country’s “particular conditions” and address the economic viability of projects.

Entrepreneurs further propose an investigation into the smuggling of products from neighbouring countries to protect Mozambicans and combat monopoly.

Mozambique has a total of 233 confirmed Covid-19 cases, two deaths and 82 accounted recovered.

Mozambique has been in a state of emergency since April 1st, with amusement and leisure facilities closed, all types of events and meetings prohibited, and the public recommended to stay at home unless they have compelling reasons to go out, such as work or essential errands.

Capacity on public transport is limited and the use of masks mandatory. Schools are closed and the issuing of entry visas has been suspended.

The head of state, Filipe Nyusi, yesterday announced the extension of the state of emergency for another 30 days.

Source: Lusa