Mozambique: Suspicion surrounding Credit Suisse deal – NGO

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Mozambique: Suspicion surrounding Credit Suisse deal – NGO

6:10 CAT | 09 Oct 2023

File photo: Reuters

The Budget Monitoring Forum (FMO), a coalition of Mozambican non-governmental organisations (NGOs), said on Thursday that the agreement between the government and Credit Suisse “may raise suspicions” about the advantages of the agreement for the African state.

“While the government considers this to be a good agreement, the same certainty does not lie with the millions of Mozambicans insofar as the Mozambican government has concealed the details of the agreement. This may raise suspicions that the agreement is not as advantageous for the country as claimed,” FMO said in a press release.

“The Mozambican government has not disclosed the details of the agreement, including the monetary benefits that Mozambique obtained from it,” the organisation said.

The NGO coalition also pointed out that “reservations” about the benefits of this pact will prevail as long as the parties do not allow “access to the terms” under which it was reached.

FMO’s concern about this “secret agreement” is also due to the fact that it completely exonerates UBS, which owns Credit Suisse, from blame for the hidden debts and does not provide for the bank to be held accountable for its role in the fraudulent scheme that led to the loans being issued, the statement said.

“This means that [UBS] will not have to pay any compensation to Mozambique for the damage caused,” the statement reads.

FMO notes that, regardless of the out-of-court settlement in any of the disputes before the courts, the cases related to the hidden debts should not be shelved “FMO will continue to monitor the ongoing cases and will produce its most detailed position following the legal and financial analyses,” the statement stressed.

On Monday, the Attorney General’s Office announced an out-of-court settlement between the Mozambican state and UBS over the case of the so-called hidden debts, considering the understanding “mutually advantageous”.

“It is understood, and it is clear that the agreement is mutually advantageous for both parties. In more concrete terms, the agreement mutually releases the parties from their obligations,” said Ângelo Matusse, Mozambique’s deputy attorney general, during a joint press conference with Mozambique’s minister of economy and finance, Max Tonela, in Maputo. The minister said the agreement between

Mozambique and Credit Suisse would restore the confidence of international investors in the Mozambican financial market and strengthen ties with other global financial institutions. The Republic of Mozambique claims that the guarantees given for the bank loans for the purchase of maritime security ships, tuna fishing boats and other equipment, with the money from undeclared debts, should not be considered valid because they were allegedly obtained through the corruption of senior state officials. The loans were endorsed by the Frelimo government when Armando Guebuza was still head of state, without the knowledge of parliament or the Administrative Tribunal. Mozambique wants to cancel the millions of dollars owed to Credit Suisse, as well as obtain financial compensation for the macro-financial damage caused.

The case, which was uncovered in 2016 and became known as “hidden debts”, involves contracts and loans of more than $2.7 billion (€2.5 billion ), according to the Mozambican Public Prosecutor’s Office, with the banks Credit Suisse and VTB, between 2013 and 2014.

Source: Lusa