Mozambique - 04

Mozambique: New Sovereign Wealth Fund: Few Details, but Positive Potential

According to Minister of Economy and Finance Adriano Maleiane, the new National Development Fund (NDF) will draw upon income from natural resources in Mozambique – specifically, capital gains tax revenues from the coal and gas sectors. He also vaguely noted that the NDF would be used to fund “good initiatives.”

Mozambique - 04

Mozambique: Privatization of Struggling Petromoc Nears

The privatization of national fuel distributor Petromoc is nearing, with Gunvor, Vitol, and Puma Energy reportedly interested in taking over the ailing company. The privatization of a number of Mozambican state companies has been in the cards since 2016, when Minister of Finance Adriano Maleiane stated that Filipe Nyusi’s administration will reduce the government’s participation

Mozambique - 01

Mozambique: Government Moves Forward with Privatization

On 5 September Minister for Finance and Economy Adriano Maleiane announced that the government will move forward with its long-anticipated privatization drive, which will include a consolidation of state interests in public enterprises through a combination of winding down non-performing companies, mergers and privatizations. The new timeframe for the sale or dissolution of much of

Mozambique

Mozambique: Revised 2016 Budget: Sugarcoating Public Finances

On 7 July the government revealed the final version of its revised 2016 state budget. Minister for Economy and Finance Adriano Maleiane announced that the budget will shrink by 10%, with the cuts affecting new construction projects, fuel, and government representatives’ travel. The changes, which were agreed to by the Council of Ministers, were submitted

Mozambique - 03

Mozambique: IMF Demands Forensic Audit of Sovereign Debt

The IMF fact-finding mission to Mozambique ended on 24 June with its calling for an independent audit of EMATUM, Mozambique Asset Management (MAM) and ProIndicus’ accounts. The three companies hold around $2.2bn in sovereign debt, much of which was hidden from public oversight and accountability institutions. The IMF mission presented an independent audit as

Mozambique - 04

Mozambique: A Missed Opportunity: Government Fails to Explain the “Illegal” Sovereign Debt to Parliament

On 8 June Prime Minister Carlos Agostinho do Rosario attended a widely anticipated extraordinary session of parliament to provide an official explanation of the country’s sovereign debt. Do Rosario is the second senior government official to speak to parliament after Minister for Economy and Finance Adriano Maleiane, who only addressed the parliamentary commission for planning

Mozambique - 02

Mozambique: The Looming Threat of Default

On 23 May Fitch Ratings downgraded Mozambique’s sovereign rating from CCC to CC, indicating a shift from “substantial” to “very high” levels of credit risk, with a default probable. Fitch’s downgrade followed Minister for Finance and Economy Adriano Maleiane’s admission before the parliamentary Planning and Budget Commission on 18 May that Mozambique Asset Management (MAM)

Mozambique - 03

Mozambique: EMATUM Bullet Bond and Selective Default Risk

Minister for Finance and Economy Adriano Maleiane has recently been traveling to the world’s financial centers lobbying for a restructuring of the EMATUM bond. The Mozambican side’s proposal is to turn the bond into a “bullet bond” with a higher annual interest rate but longer maturity, from 2020 to 2023. Investors will be unable to

Mozambique - 03

Mozambique: Bank of Mozambique Capital Controls: New Risks for IOCs

Despite attempts by the Bank of Mozambique to mitigate the metical’s drop against the US dollar, the currency’s slide is continuing unabated: since November 2014 the metical has lost 75% of its value against the dollar, resulting in increasingly expensive imports. The same is true for the metical’s position versus the rand and euro, though

Mozambique - 02

Mozambique: EMATUM Episode Impacts Mozambique’s Credit Rating

Doubts regarding the financial viability of state-owned EMATUM and talk of a debt restructuring resulted in S&P downgrading Mozambique’s long-term credit rating from “B” to “B-” on 6 July and placing the country’s short-term rating on credit watch with negative implications. S&P’s decision was principally in response to Minister for Finance and Economy Adriano Maleiane