Watch – Findings imply “criminal offence” in hidden debts case – Mozambican Attorney General’s Office

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Watch – Findings imply “criminal offence” in hidden debts case – Mozambican Attorney General’s Office

4:17 CAT | 15 Jul 2016

TVM / Deputy Attorney General and spokesman to the Attorney General's Office Taibo Mucobora

The Attorney General of the Republic of Mozambique said yesterday that there are signs of criminal offence having been committed with regards to the so-called hidden debts guaranteed by the Mozambican government between 2013 and 2014, ensuring that it will request the intervention of international experts in investigating the case.

“There is a breach of the budgetary legislation, with regard to non-compliance with the limits imposed by law, and this implies a criminal offence in the form of abuse of [public] office or function,” spokesman for the Attorney General’s office Taibo Mucobora told a press conference yesterday.

According to Mucobora, the Attorney General continues to carry out preparatory inquiries to determine the destination of the substantial borrowings by the Mozambican Tuna Company (Ematum), ProIndicus and Mozambique Asset Management (MAM) with the guarantee of the government.

“The Attorney General will also continue to make every effort to identify and confirm the purchases and contracted services in these companies and made with the amounts resulting from the loans,” Mucobora said.

Mucobora added that the assistance of international experts would be called upon in order to arrive at a reliable determination of the contours of the so-called hidden debts.

“The collection of this information requires a lot of work and, above all, requires specific knowledge in the areas of accounting and auditing, which is why the Attorney General will request the appointment of national and international experts,” Mucobora stressed.

Mucobora emphasised that the process concerning the loans the Mozambican government endorsed with neither parliamentary authorisation nor consultation of international financial organisations is complex and involves a lot of money and a lot of people and countries.

The International Monetary Fund and donors to the state budget suspended their support this year after the revelation of the existence of US$1.4 billion (EUR1.2 billion) in loans guaranteed by the government to subsidiaries of the state which were not declared in the public accounts.

With the revelation of the new loans, figures for Mozambique’s public debt have risen to US$11.66 billion (EUR10.4 billion), of which US$9.89 billion (EUR8.9 billion) is owed abroad. This represents more than 70 percent of gross domestic product, up from 2012 levels of around 42 percent.

At the end of the visit of a Fund mission to Maputo in late July, the institution said that Mozambique faced difficult economic challenges, and that economic growth in 2016 was expected to fall to 4.5 percent this year against 6.6 percent in 2015, almost 3.3 percentage points below historical levels, with a substantial risk of the projection falling further in the future.