Mozambique’s attorney general vows to nail state firms involved in dodgy loans

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Mozambique’s attorney general vows to nail state firms involved in dodgy loans

11:35 CAT | 24 Jun 2016

Mozambique’s prosecuting authority on Thursday promised parliament it would thoroughly investigate three state firms accused of swindling the government out of more than $2 billion, state media reported.

Attorney-General Beatriz Buchili told the National Assembly her office was seriously probing state tuna company Ematum, Mozambique Asset Management (MAM), and maritime security company Proindicus for illegal conduct.

Ematum borrowed $850 million from foreign financiers in 2013 to finance “fishing infrastructure” via a government-backed bond, but the project has dismally underperformed and has since been converted into a defence project.

While state investment arm MAM borrowed $535 million to build shipyards to cater for a burgeoning offshore gas sector, but missed a May deadline for its first loan repayment, pushing Mozambique to the brink of a crippling default.

The state attorney will also investigate former president Armando Guebuza, who was at the helm when government guaranteed the multi-billion dollar loans that it says equate to about 20 per cent of Mozambique’s total foreign debt.

Buchili said her office would strive to “gather information on how these companies were set up, how they function and how they obtain funds”.

An International Monetary Fund mission is currently in Mozambique following revelations in April that the country had failed to disclose more than $1 billion of secret, government-backed borrowing.

Source: Reuters