Mozambican NGO’s demand explanations on Ematum and criminal investigation

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Mozambican NGO’s demand explanations on Ematum and criminal investigation

2:12 CAT | 25 Apr 2016

VOA (File photo)

Member organizations of the Budget Monitoring Forum (FMO) expressed outrage on Friday over the impact of the Ematum case on Mozambique’s debt and demanded explanations from the government and a criminal investigation.

“As citizens and taxpayers of this country, we demand that the government conducts a comprehensive audit of public debt, so that everyone knows the actual amount, the creditors and the payment period of each of the debts,” an FMO statement sent to Lusa reads, adding that it is waiting for the executive to share information with the Mozambican public and not only abroad.

The forum brings together various civil society institutions such as the Foundation for Community Development (FDC), led by Graça Machel, the Learning and Training Centre of Civil Society, the Mozambican Debt Group and the Centre for Public Integrity.

In the statement, the platform also requires the government to present its strategy for debt payment, holding the authors of the current crisis responsible and reformulating the tax structure, “putting an end to the situation where large companies do not pay taxes or pay only in part”.

For the FMO, the government also has to establish “an array of priorities for future borrowing, so that no government or leader may incur debt for projects of questionable feasibility and priority”.

In response, the FMO requires that the parliament creates a commission of inquiry into case, requiring the government to never exceed the maximum limits of the guarantees it provides without prior approval from parliament. The FMO is also lobbying for a law of fiscal responsibility “that penalizes the violation of the maximum limit of guarantees set out in the budget law and ensures that public managers who harm the state are exemplarily punished”.

At the same time, it requires the Attorney General’s Office to investigate administrative and criminal liability of “all officers involved in contracting debt in a non-transparent manner and in violation of the budget law, particularly in the last five years”, and demands that the Central Anti-Corruption Bureau act in the same manner.

The document expresses “indignation” over the latest revelations and cites figures released on Friday by Lusa about the disparity between the public debt amounts presented in the official government accounts and those given to investors in the Mozambican Tuna Company (Ematum) securities repurchase operation.

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

According to the confidential document that investors in Ematum bonds were presented with before deciding to exchange the bonds for new sovereign debt last month, “the total public debt [including domestic debt, external and debt guaranteed by the State] amounted to 56.6 percent of GDP in 2014 and is expected to reach 73.4 percent in 2015″.

Source: Lusa