Mozambican parliament asks government to clarify hidden debts

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Mozambican parliament asks government to clarify hidden debts

2:50 CAT | 24 May 2016

Lusa (File photo) / The government will answer question in parliament's plenary session

National Assembly Standing Committee spokesman Mateus Katupha has announced the convening of an extraordinary session of parliament for 8 and 9 June, for government clarification of the undisclosed debt situation.

The convening of the extraordinary session reverses previous rejections by the Frelimo-dominated body of several Renamo requests that the government be called to parliament to give a full account of the matter.

In a press conference held yesterday, the head of the Renamo parliamentary bench, Ivone Soares, said the convening of the special session was “good news”, and that it would require the government to provide responsible answers with proper supporting documentation.

“On behalf of Renamo in parliament, we reiterate our commitment on behalf of about 25 million Mozambicans to demanding that the Frelimo government provides all necessary clarification and documentation on this debt, which is worrying Mozambican society,” Soares said.

The government, she continued, should give reasons for its failure to apply to parliament for authorization, indicate those responsible for the debt and the consequences for society.

The Mozambican government in April acknowledged the existence of a previously undisclosed debts of US$1.4 billion (EUR 1.25 billion), which it justified on national security grounds to strategic infrastructure in the country.

The revelation of government-guaranteed loans contracted between 2013 and 2014 led the International Monetary Fund to suspend the second installment of a pre-agreed loan to Mozambique and cancel a mission to Maputo.

The G14 group of state budget donors also suspended its payments, followed by the US, which announced that it would review its bilateral support to the country.

Mozambique Minister of Economy and Finance Adriano Maleiane said last Wednesday that the country’s public debt was under control and within acceptable parameters, but admitted there would be payment difficulties in the short term.

At a hearing boycotted by Renamo in protest at its taking place in committee rather than in plenary session, Maleiane warned that Mozambique Assets Management (MAM), one of the companies benefiting from the state-guaranteed loans, did not have the funds to make its first loan repayment, due yesterday, May 23, and was seeking to restructure the debt to avoid default.

Source: Lusa