IMF mission visits Mozambique with economic situation and hidden debts in the agenda

Login

Register

http://www.clubofmozambique.com/

IMF mission visits Mozambique with economic situation and hidden debts in the agenda

12:47 CAT | 30 Nov 2017

An International Monetary Fund (IMF) mission arrives in Mozambique today to discuss the country’s economic developments and the hidden debts process, the agency’s representative in Maputo Ari Aisen told Lusa.

For the time being, the resumption of an IMF financial programme with the Mozambican state, suspended in 2016 due to the sovereign debt scandal, is not on the table.

“We are not contemplating this now: the focus is really on Article 4” of the IMF Statutes, which governs the visit, and the issue will “only be discussed eventually”, Aisen said in an interview with Lusa.

The article in question is a rule that provides for consultations with member countries, where macroeconomic performance assessments are conducted, and “monetary, fiscal, and financial policies to really cope with the situation are discussed”, he said.

Asked whether hidden debts are included in this scenario, Ari Aisen said that the dossier “will be under analysis” in a context of “structural reforms” and the “government response”, namely on “how to close this information gap in the audit”.

“The mission will inquire into the government’s plans in this area,” he added.

The visit of the IMF team is expected to last until December 13.

“The idea is that next year we will have a report” on these consultations, the IMF representative said, adding that the document would be published in early 2018 “so that the IMF’s position is laid out”.

The IMF and the group of 14 direct donors to the state budget (including Portugal) suspended transfers to Mozambique in 2016 following the hidden debt scandal.

Finance Minister Adriano Maleiane said this month that the country needs the resumption of international support and that it is working to provide answers on the fate of the missing two billion dollars borrowed without parliamentary authorisation.

The debt was contracted in 2013 and 2014 during the presidency of Armando Guebuza by three public companies owned by the State Information and Security Service (SISE): Ematum, intended to form a fishing fleet, Proindicus, aimed at security and maritime surveillance, and MAM, linked to ship maintenance.

An audit by international consultancy Kroll requested by the Attorney General’s Office (PGR) and released in June describes the firms as a facade without credible management plans, and implicates several holders of public office in the process, without naming them.

Kroll further complains that it has been denied access to relevant information about where the money went on the grounds that the information is sensitive and relates to state security.

So far, no steps have been taken by the Mozambican courts to establish liability.

The IMF maintains the official position communicated at the end of the last mission to Mozambique in July, that it would resume a programme only after being provided information that was denied by the public companies themselves to Kroll and after a form of accountability for the known irregularities had been established.

Meanwhile, rating agencies have lowered the country’s rating to default, closing the doors to financing in international markets.

The lending banks are also being investigated by US federal investigators and the United States Department of Justice, in addition to UK and Swiss financial regulators.

Source: Lusa