MDM demands parliamentary inquiry into undisclosed debts of Mozambican government

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MDM demands parliamentary inquiry into undisclosed debts of Mozambican government

2:16 CAT | 26 Apr 2016

In File Club of Mozambique / Daviz Simango, leader of Democratic Movement of Mozambique and Mayor of Beira, capital of Sofala central province.

The president of Mozambique’s third-largest political party, the Democratic Movement of Mozambique (MDM), Daviz Simango, yesterday demanded the creation of a parliamentary commission of inquiry to ascertain the situation of public debt.

“The MDM demands and will propose the creation of a parliamentary commission of inquiry into public debt”, Simango said at a press conference in Beira, where he is also mayor.

Public debt, Simango said, must be registered with the Central Bank and reported to parliament, whose authorization should be requested for debts in excess of the legally established limits.

“The government is willing to explain to Brussels and send teams to the United States of America (USA), but our sovereignty requires the government to explain to Mozambicans in parliament,” said the president of MDM.

Simango was referring to the trip last week of the head of the Mozambican state, Filipe Nyusi, to the headquarters of the European Union as part of a working visit to Europe, which some commentators say has been used to smooth over the hidden debts scandal.

Simango’s allusion to the US refers to Prime Minister Agostinho do Rosario’s emergency flight to Washington for meetings with the International Monetary Fund, which suspended the disbursement of aid worth US$150 million and cancelled a visit to Mozambique following revelations surrounding the debt.

Simango argued that in a democracy, state affairs are discussed in the sovereign bodies and not in political party school rooms like Frelimo’s Central Committee meeting in Matola.

A steady stream of Mozambican organizations has begun expressing indignation regarding the impact of hidden government loans, demanding explanations from the government and a criminal investigation.

According to a confidential Ministry of Finance prospectus prepared for Ematum investors, Mozambique’s public debt increased from 42 percent of GDP in 2012 to 73.4 percent in 2015.

Ematum provided the first known case in Mozambique of a loan being guaranteed by the state without registration in the public accounts. The 2013 US$850 million loan has since entered the Mozambique public debt accounts, having been swapped for sovereign debt in March.

When the news first emerged about hidden Ematum loans, the majority Frelimo bench rejected a proposal by the Renamo (Mozambican National Resistance, the main opposition party) to investigate the circumstances in which the debt was contracted.

Source: Lusa