Renamo calls government to parliament over Ematum debt swap

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Renamo calls government to parliament over Ematum debt swap

12:40 CAT | 12 Apr 2016

Renamo, the largest opposition party in the Mozambican parliament, has asked the president of the national assembly Verónica Macamo to call the government to parliament to explain the conversion of Ematum (Mozambican Company Tuna) debt into sovereign debt and the concealment of US$622 million (EUR 545 million) loan to the company.

Speaking to Lusa, Renamo spokesman Antonio Muchanga said: “We want to understand how a company debt has now become a debt of all of us.”

“We also wants clarification on the secret loan of around US$622 million dollars,” Muchanga added.

Last week, the Council of Ministers announced that the state had taken over as sovereign debt a loan of US$850 million contracted by Ematum in the European debt securities market because of the company’s inability to repay it.

On Monday of last week, the US Wall Street Journal reported that investors in the Ematum debt bond swap operation were not informed of another loan granted by the same banks amounting to US$622 million.

According to the Wall Street Journal: “What investors did not know is that in 2013 Credit Suisse and VTB [the two banks that organized the Ematum bond swap operation this year] lent US$622 million to another state company called Proindicus to finance the purchase of ships and radar installations to combat piracy.”

The Wall Street Journal also says that the following year, “the banks approached investors to extend the loan for a value up to US$900 million,” but does not specify whether this operation was completed.

The Mozambican government has not yet ruled on this supposed second loan.

The scandal involves the Ematum tuna-fishing company, which is owned by various public bodies including the Mozambican secret service and which took on debt with the government as guarantor and therefore by default at the expense of the state.

Initially regarded as a private business using hundreds of millions of dollars in loans to buy fishing boats from France, it is now understood that Ematum was also used to buy military equipment. Under pressure from donor countries, the business was included in an amending state budget last year.

Source: Lusa