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Lord Mayor of London defends rule of law in business transactions
7:15 CAT | 14 Sep 2017
Twitter / Andrew Parmley speaks to the press in Maputo on September 11
The Lord Mayor of London, Alderman Andrew Parmley, on Wednesday stressed the importance of defending the rule of law in business transactions.
Interviewed by AIM in Maputo, at the end of a three day visit to Mozambique, Parmley said he was aware of the damage done to Mozambique’s reputation by the scandal of the country’s “hidden debts”. These are the loans for over two billion US dollars which three security-related companies, Ematum (Mozambique Tuna Company), Proindicus and MAM (Mozambique Asset Management) took from the European banks Credit Suisse and VTB of Russia. The loans were illicitly guaranteed in 2013 and 2014 by the Mozambican government of the day, headed by President Armando Guebuza.
The Lord Mayor has an interest here because it was the London branches of Credit Suisse and VTB which handled the loans. The company Kroll Associates, which carried out an independent audit of Ematum, Proindicus and MAM, suggested that Credit Suisse had broken English law through its failure to undertake any due diligence of the Mozambican company, and criminal changes could therefore be brought against the bank in London.
Asked whether he would support such a case against Credit Suisse, Parmley did not answer directly but stressed “we absolutely uphold the rule of law in all transactions”. He regarded English company law as particularly robust.
The Lord Mayor recognised that the scandal of the hidden debts was “a blight on Mozambique” and had clearly undermined confidence in the country.
He hoped that Mozambique would achieve closure on this issue, and if investigations ran into a dead end “it would be good if the Mozambican government were to admit that it cannot get to the bottom of it”. The scandal, he added, pointed to the need for “tighter regulation”.
Parmley said he had met with Prime Minister Carlos Agostinho do Rosario, Finance Minister Adriano Maleiane, as well as a range of senior figures in Mozambican banks and other businesses.
London “is home to ten of the top 20 sovereign wealth funds”
“Our role is to promote business”, he said, “and locate areas where we can invest”. He was particularly interested in future collaboration between the City of London and the Mozambican Stock Exchange.
Parmley stressed the importance of establishing a sovereign wealth fund, which could hold eventual revenues from Mozambican natural resources, such as the enormous natural gas reserves off the northern coast. He pointed out that London “is home to ten of the top 20 sovereign wealth funds”.
Asked if this is likely to continue, if Britain does indeed withdraw from the European Union in 2019, Parmley admitted concerns that the City of London might lose business, but stressed that so far this has not happened.
He said that, although the City of London is “a non-political body”, it had been in favour of a vote to remain in the EU at the time of 2016 referendum.
“So far, there’s not much movement away from London”, Parmley said. “Businesses are making contingency plans to relocate, but to date very few have done so. At the moment it’s business as usual”.
He hoped that British Prime Minister Theresa May “will reach a bespoke deal with the other 27 members of the EU”.
The Lord Mayor is the head of the City of London Corporation, a non-remunerated post, which is only held for a year. He represents the business and financial interests of the City of London, and is described as an ambassador for the British financial and professional service sector.
The Lord Mayor should not be confused with the elected Mayor of London (currently Sadiq Khan), although the two men work together to promote London.
Source: AIM
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