Mozambique clashes may disrupt coal mining in Tete, London risk consultancy says

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Mozambique clashes may disrupt coal mining in Tete, London risk consultancy says

11:41 CAT | 23 Mar 2016

Clashes between Mozambique’s main opposition Mozambican National Resistance movement and government forces may disrupt coal mining in the western Tete province and could result in insurgents targeting infrastructure projects, PGI Intelligence said.

An escalation in fighting between the two sides also poses a risk to the movement of goods along the Nacala logistics corridor as infrastructure may be sabotaged, the London-based risk consultancy said. The corridor links the Malawian commercial capital, Lilongwe, to Mozambique’s Indian Ocean coast.

“As the violence continues, attacks on transport and disruption to road travel will remain key security considerations in parts of northern and central Mozambique,” PGI said. Vale SA, based in Rio de Janeiro, operates a coal mine at Moatize in Tete province.

Renamo, led by Afonso Dhlakama, and the ruling Front for the Liberation of Mozambique, or Frelimo, have had an uneasy relationship since ending a 16-year civil war in 1992. Frelimo won the country’s first democratic elections two years later. The party has ruled the southeast African nation of 26 million people since 1975.

Sporadic clashes erupted in 2013 in central Mozambique and a cease-fire was agreed in September the following year in time for elections the next month. Fighting flared again last year.

Government Offensive

A planned government offensive against the opposition party could lead to an “escalation in fighting,” and it will fail to dislodge Renamo’s forces, PGI said.

Mozambique’s neighbors including Zimbabwe and Malawi are “at risk of disruption” because of an influx of refugees as the fighting intensifies, it said. “Any offensive launched by the government will increase the likelihood of further disruption, particularly in Manica and Sofala,” PGI said.

An estimated 11500 civilians have fled the conflict into neighboring Malawi since December, according to the United Nations Refugee Agency.

Mozambique government, led by President Filipe Nyusi, is trying to attract investment to exploit gas finds in the offshore northern Rovuma basin that could help turn the country into the world’s third-biggest liquefied natural gas exporter in a decade. Mozambique is awaiting final investment decisions from companies including Eni SpA and Anadarko Petroleum Corp.

Source: Bloomberg