Mozambique: Russian ambassador meets with CTA

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Mozambique: Russian ambassador meets with CTA

3:03 CAT | 01 Aug 2022

Photo: CTA

In the context of the current cereal crisis, especially wheat, the Confederation of Economic Associations of Mozambique CTA welcomed the Russian Ambassador to Mozambique, Alexander Surikov, in search of solutions to mitigate the scenario.

One of the issues that the ambassador addressed was how Mozambican companies could have direct access to Russian wheat suppliers. In this regard, it was not clear how Russian wheat would enter the market and how it would be paid for because Mozambique uses principally the US dollar in its foreign transactions, and Russia cannot conduct transactions using the US currency due to the sanctions imposed following the invasion of Ukraine.

However, the ambassador reported that the Secretary-General of the United Nations has promised to intercede with Western countries to lift some sanctions and allow Russian trade transactions to go ahead.

At the meeting, Alexander Surikov expressed Russian companies’ continuing interest in investing in Mozambique, with Russian investment contributing to development here. One example is Tazetta Resources, currently involved in a mining project in Zambézia, and the largest taxpayer in the province.

READ: Mozambique: Russia willing to trade using rubles, meticais

The volume of trade between Russia and Mozambique doubled in the first five months of this year, compared to the same period of 2021. Exports from Russia to Mozambique, principally of cereals and fertilisers, tripled during this period.

To overcome this blockade, it was suggested that future Russian investments in Mozambique would be made in the Russian rouble or the Mozambican metical.

Likewise, the possibility was raised of Russia opening a bank in Mozambique focused on supporting bilateral trade and investment.

Fuel sector companies present at the meeting reported that they were registering a significant drop in sales due to the rise in prices. Consumers were taking measures to reduce fuel consumption, which had in turn cut sales, they said.

The Russian ambassador said that a metric ton of fuel could trade at around US$500, half the current market price, and this could generate benefits for both companies and the general population.

READ: To stabilise fuel prices in Mozambique: Russia advocates exchange in this sector – Notícias