State-owned real estate value falls nearly 114 billion meticais in just one year – CIP

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State-owned real estate value falls nearly 114 billion meticais in just one year – CIP

9:00 CAT | 19 Apr 2023

FILE - For illustration purposes only. [File photo: CIP]

The year 2021 was marked by a drastic fall in the value of state property.

The reduction of state property values can be seen in the direct administration of autonomous state bodies and in the indirect administration by public companies and municipalities.

In December, 2020, the state’s real estate had a gross value of around 590.6 billion meticais. By December, 2021, this value had fallen to 476.6 billion meticais, a reduction of around 113.96 billion meticais, or 19.3%.

This reduction worsens when analysing the State Business Sector (Sector Empresarial do Estado – SEE), where the reduction in real estate value over the year was nearly 34%.

At the beginning of 2021, properties held by the State Business Sector were valued at 214.1 billion meticais. At the end of the same year, properties had a value of 141.6 billion meticais, a reduction of 72.49 billion, around 33 .9%.

Number 1 of article 50 of the SISTAFE3 law dictates that the government must carry out an analysis of the variation of real estate assets and publish the details in the General State Account (CGE).

However, this figure for 2021 has not been published, which makes it difficult to trace real returns, increasing the risk of misappropriation.

The 2021 RPCGE also shows that there is a lack of mapping of those real estate assets which are in a state of idleness, obsolescence or an advanced state of degradation.

There are also issues concerning the allocation of state real estate to employees for long periods of time without legally established criteria, and of real estate assets held outside the e-inventory.

Taking into account the high level of fiscal risk of State Business Sector companies, associated with constant negative net income and high levels of private debt, the risk of misuse of public real estate assets is increasing.

Given the low level of transparency in the management of public companies, the non-publication of reports and accounts, the absence of the consolidated report of the State Business Sector and of information on changes in property assets in this sector, it is imperative and urgent that the causes of the variation of State Business Sector properties be duly analysed and published.

You may read the full CIP report (in Portuguese) HERE.

Valor de imóveis do Estado caiu em 114 mil milhões de meticais em apenas um ano
2021 foi marcado pela queda drásticas do valor dos imóveis do Estado.
Leia o artigo na íntegra: https://t.co/ux930oiTLP pic.twitter.com/YNeP9EVTtF

— CIP-Mozambique (@CIPMoz) April 19, 2023