Mozambique News Agency

No.217, 15th October 2001


President Chissano criticises MOZAL strike

President Joaquim Chissano on 12 October criticised the strike at the MOZAL aluminium smelter, which started on 3 October, noting that MOZAL pays higher wages than any other industry in the country.

Speaking during a reception he offered to trade union leaders, as part of a week of commemorations of the 18th anniversary of the founding of the country's main labour federation, the OTM, President Chissano said it had been a great victory for Mozambique to attract an investment the size of MOZAL. "This is the bait to attract other foreign investment", he said. "But now there is a danger that this will all be brought down".

"The workers who say they are suffering injustice at MOZAL are not the poorest workers", he added. "We have many workers who are much poorer".

"We have to find a solution which ensures that MOZAL remains a basis for attracting the projects that are essential for the elimination of unemployment and absolute poverty", said the President. Strikes, he added, should be "the last resort in the workers' struggle. We have to observe this principle in solving labour disputes".

Meanwhile, talks on 11 October between the MOZAL management, the OTM and the Engineering Workers Union (SINTIME), to which the strikers belong, reached no common platform of understanding.

A company spokesman told AIM that MOZAL proposed resuming talks on the 2002 wages and conditions on 1 November. This would be a continuation of talks that were interrupted by the strike on 3 October. SINTIME has not yet responded to this proposal.

"Everything the workers want to discuss can be included in the talks covering 2002", said the MOZAL spokesman. "But the 2001 dossier is closed".

SINTIME, however, is insisting that its wage demands (which include indexing MOZAL wages to the US dollar, housing and education subsidies, increased shift bonuses and danger money) should be implemented in what remains of this year.

The OTM urged MOZAL "to return to the table, and accept negotiations for the solution of the problems presented".

Meanwhile, 30 of the 468 strikers have returned to work, according to MOZAL. They were each interviewed, and then readmitted to the factory, with the management scrapping the dismissal notices it had issued against them earlier.

MOZAL claims that its drive to recruit new workers to replace the strikers has been highly successful: so far 3,300 people have responded to the advertisements for "operators" and "maintainers" placed in the Mozambican press.

As for whether the strike is legal or not, a jurist from the Labour Ministry, cited in the latest issue of the weekly paper "Savana", pointed out that on 3 October, SINTIME had started the strike while negotiations with the management were still under way.

This violated Article 133 of the Labour Law, which states that workers may not resort to strike action while negotiations are taking place.

SINTIME official Simeao Nhantumbo, however, denied that the talks of 2-3 October constituted negotiations. "We weren't yet negotiating. We were still trying to draw up an agenda with the employer", he claimed.

The same jurist added that the law also forbids strikes while a collective bargaining agreement is in force, unless the agreement is violated by the employer first.

The collective bargaining agreement of December 1999 is still in effect at MOZAL (although the workers are demanding that it be revised).

MOZAL responsible for 60 per cent of exports

According to the latest figures on the economy from the Bank of Mozambique, exports in the first half of this year amounted to $307.5 million - of this $185.5 million (60.3 per cent) came from the aluminium ingots exported by MOZAL.

Several of Mozambique's traditional exports suffered sharp falls. Cotton exports fell by 49.1 per cent, from $16.3 to $8.3 million dollars - this was because production dropped as peasant farmers, disappointed at the low producer price for cotton, switched to other crops.

The fall in cashew kernels was even sharper: here the decline was 81.6 per cent, from $4.9 million in the first half of 2000 to $900,000 million this year. The Bank of Mozambique blames this fall on a decline in the world market price of cashew kernels. But that fall was only 30 per cent - the real reason for the collapse in exports was that most of Mozambique's cashew processing plants have been forced to close, driven out of business by the liberalisation of trade in raw cashews imposed by the World Bank.

With most of the cashew factories closed, peasants have to sell their nuts to traders who export them unprocessed to India. Thus earnings from the export of unprocessed nuts rose by 51.6 per cent, from $3.1 to $4.7 million.

Timber exports fell by 40.3 per cent - from $6.7 to $4 million. This, however, was the result of deliberate government policy: the government has imposed restrictions on the export of unprocessed logs, in an attempt to encourage local processing of timber.

After aluminium, the most important export product is prawns, which remained virtually unchanged at $37.2 million in the first half of 2000, and $37.9 million this years.

Third on the list is electricity: power from the Cahora Bassa dam on the Zambezi is sold to South Africa and Zimbabwe. The value of electricity exports rose from $21 to $29.4 million, due to the increased tariff for Cahora Bassa power paid by the South African electricity company. ESKOM.

Imports decline

Imports declined by 13.5 per cent, from $569.8 million in January-June 2000, to $492.7 million in the same period this year.

Imports of consumer goods declined by 27.8 per cent (from $163.8 to $118.4 million), mainly because there were fewer imports of emergency aid. (The catastrophic floods of February 2000 led to large imports of food and non-food emergency items: the floods in the Zambezi and Pungue valleys of early 2001 were on nothing like such a dramatic scale, and so did not generate imports on the same scale.) Substantial declines in the imports of spare parts and equipment (of 26,4 and 25.8 per cent respectively) are also attributed by the central bank to post-flood recovery. Large amounts of machinery and spare parts were imported immediately after the February 2000 disaster: the requirements this year were on a smaller scale.

Imports of liquid fuels, however, rose by 53.4 per cent, from $44.3 to $67.9 million, while imports of electricity soared by 350.7 per cent (from $4.1 to $18.4 million). The latter is due to MOZAL - the 450 megawatts that MOZAL requires are imported from South Africa by the company MOTRACO, a consortium formed by the Mozambican, South African and Swazi electricity companies.

Thanks to MOZAL, the balance of trade improved considerably - from a deficit of $441.4 million in the first half of 2000, to one of $185.2 million in January-June this year. Exports now cover 62.4 per cent of imports, whereas last year the figure was only 22.5 per cent.

President optimistic about Niassa

President Joaquim Chissano has expressed confidence that the Niassa province will emerge from its current "serious problems" and become the country's granary, reports "Noticias" on 1 October. Niassa is the largest, most remote and least populated of Mozambique's 11 provinces.

Addressing a rally in Lichinga, the provincial capital, to mark the end of a five day working visit to Niassa, President Chissano said that "despite poverty, Niassa people do not despair. I was very happy to learn that they have organised themselves, in some areas, to manage their natural resources".

As some of the undertakings that should help develop Niassa, President Chissano mentioned the building of a bridge over the Zambezi river, to facilitate communications between southern and northern Mozambique, the opening of a road to link Niassa with Cabo Delgado, giving it access to the sea, and the extension of the national electricity grid.

Electricity, produced at the Cahora Bassa dam, in Tete province, is to be drawn from the Gurue substation, in Zambezia, and transported along a 350 kilometre line to Lichinga. This work is expected to be completed by 2004.

The Minister of Mineral Resources and Energy, Castigo Langa, who was accompanying the President, explained that the money for this project has already been pledged by the governments of Norway and Sweden.

Funeral of Oswaldo Tazama

The body of Lt-Gen Oswaldo Tazama was laid to rest on 11 October in the crypt of Maputo's Monument to the Mozambican Heroes, alongside the founder of Frelimo, Eduardo Mondlane, the country's first President, Samora Machel, and other heroes of the liberation struggle. The government declared a national day of mourning, with flags flown at half mast throughout the country.

Giving the main funeral speech, President Joaquim Chissano declared "to speak of Tazama is to celebrate the history of the Mozambican people's struggle against Portuguese colonial rule. To speak of Tazama is to recall the deeds of all those who firmly opposed all forms of colonial domination".

Tazama joined Frelimo in 1963, said President Chissano, and had been among the first groups of guerrillas who received military training in Algeria, in preparation for launching the war for Mozambican independence.

Tazama, the President recalled, had played "a decisive role" in military operations in his home province of Niassa. He commanded the guerrilla unit that launched the war in Niassa in September 1964, and later became Niassa provincial commander.

Four years later, in 1968, he played a key role in organising Frelimo's second congress, held in liberated territory inside Niassa.

"Comrade Tazama always understood that the struggle did not just mean taking up arms", said Chissano. "He carried out the hard work of patriotic education, trying to train men free of racial, ethnic and cultural prejudices, and who could build a united and indivisible Mozambican motherland".

After independence, Tazama held the posts of general commander of the police, governor of Zambezia province, and Secretary of State for Veterans.

"A tireless fighter, he participated actively in the struggle against foreign aggression waged by Ian Smith's Rhodesian regime and by the South African apartheid regime", said President Chissano.

"Remembering Tazama is a real lesson in patriotism for the new generations", he added. "With this solemn act of homage to Tazama, we are also recalling all those who contributed to building and consolidating our national independence".

Today, the enemy beating on the doors of Mozambican society was illiteracy, hunger and misery. "The battle against this enemy demands the same courage and dedication with which Tazama fought against the forces of colonialism and racism", declared President Chissano.

Telecentres gain popularity

There were about 90,000 visits to Mozambique's first two Internet Access Community Posts, also known as Telecentres, in the districts of Manhica and Namaacha, in Maputo province, between August 1999 and December 2000, according to the project coordinator, Polly Gaster, of the Eduardo Mondlane University's Computer Centre.

She described this figure as encouraging, if one takes into account that Manhica has a population estimated at 130,000 and Namaacha 30,000, of whom only 32,000 are living in the district capitals where the telecentres are located (22,000 in Manhica town and 10,000 in Namaacha). Gaster was speaking during the International Symposium on the strategy for implementing the government's computer policy, which has been under way in Maputo since 3 October.

But the absolute numbers of telecentre visits are deceptive. Gaster said they did not indicate that the telecentres are achieving the purpose for which they were created, namely to give people easier access to new Information and Communication Technologies (ITCs), particularly the internet. She explained that most of the visitors go there for other services, such as the public telephone, fax, or photocopying machine, or merely out of curiosity, but a few do learn the first steps in the use of computers.

In Manhica, just 64 people, and another 65 in Namaacha were reported to be using the internet or e-mail. Gaster thought that such low figures could be because most people are not yet acquainted with these technologies, and also because of sheer lack of information as to their usefulness.

In terms of revenue, Gaster said that the various services provided by the telecentres generated the equivalent of $36,200 during the period in question ($20,100 in Manhica, and $16,100 in Namaacha). She noted, however, that this comes nowhere near covering the costs of running the centres, estimated at $53,700.

One of the objectives when creating such centres was to reduce asymmetries between rich and poor, and between the urban and the rural areas, in terms of capacity to use new technologies.

Gaster said that the telecentres project "is to be expanded to other provinces, in cooperation with local partners". The next ones to be established will be in Sussundenga and Gondola, in the central province of Manica, and Chokwe, in the southern province of Gaza.

Through the telecentres, the government is planning a gigantic leap in the number of Internet users from the current rate of two out of every 10,000, to 11 out of every 100 people over a four year period.

A report from the National Survey on the country's Computer Capacity, says that there are currently 60,000 computers in Mozambique, but the government expects to bring this figure up to about 600,000 within the next four years - or from roughly three per 1,000 people, to three per hundred.

Renamo reaffirms congress for October

Mozambique's main opposition party, Renamo, has reaffirmed that its congress will take place in late October, in the northern city of Nampula.

Gania Mussagy, a member of the Congress preparatory team, said that there is nothing, at the moment, to dictate any further postponement of the congress. which will be the first since Renamo signed the peace agreement of 1992 with the government, bringing the war of destabilisation to an end.

Renamo initially scheduled the congress for September, but it was postponed on the grounds that more time was needed for provincial conferences and election of delegates.

Mussagy said that 640 delegates from all provinces, 210 of them from Nampula, are to take part in the congress. She said that the congress agenda includes such issues as corruption in public institutions, declining living conditions, and the political discrimination Renamo claims to suffer from.

"We also intend to reopen the 'elections dossier' since it has not yet come to any conclusion, because, starting with the first elections, in 1994, Frelimo has been stealing the opposition's votes", said Mussagy.

Zambezi ecosystem part of UNEP project

The Zambezi valley eco-system has been selected as one of a group of eco-systems worldwide due to benefit collectively from a $600 million scheme under the Millennium Ecosystem Assessment (MEA) project of the United Nations Environmental Programme (UNEP).

Launched on 5 June, MEA is a four-five year project designed to improve the management of the world's natural and managed ecosystems, by helping to provide policy-relevant scientific information on their condition, and options for appropriate responses.

It is thought that the assessment will provide decision-makers with authoritative scientific knowledge concerning the impact of changes to the world's ecosystems on human livelihoods and their environment.

Furthermore, it will supply better information to governments, the private sector and local organisations on the steps that can be taken to restore the productivity of the world's ecosystems.

Although MEA is run by a UNEP-led consortium, parts of it will be carried out by national institutions.

Mandela opens transfrontier park

Former South African President Nelson Mandela on 4 October opened a 35,000 square kilometre cross-border park covering parts of South Africa, Mozambique and Zimbabwe.

There is some confusion as to what the park is called - in Mozambique it has simply been referred to as "Gaza-Kruger-Gonarezhou", referring to the areas of the three countries included. But the South Africans are calling it the Great Limpopo Transfrontier Park.

Mandela opened the gate between South Africa and Mozambique to allow the first 40 elephants to be moved. "The world can learn from us how to use our natural heritage to the benefit of all," he said.

The International Fund for Animal Welfare has enthusiastically praised the move to relocate part of the Kruger National Park's 9,000-strong elephant population to Mozambique.

"The decision to establish new elephant populations in Mozambique by transferring Kruger National Park elephants across the border is truly within the spirit of Peace Parks," said Jason Bell, IFAW Regional Director for Southern Africa. "These 1,000 elephants will form the nucleus of re-establishing the herds that once roamed freely along the natural migration routes that traverse the borders between the three countries".

Mozambican banks merge

The shareholders of Mozambique's two largest banks, the BCM (Commercial Bank of Mozambique) and BIM (International Bank of Mozambique) on 12 October approved the merger of the two banks.

The major shareholder in both banks was the Portuguese Commercial Bank (BCP), the largest financial institution in Portugal. The BCP had always been the dominant shareholder in BIM, which was set up in 1995 It acquired the BCM in 2000, because of a merger in Portugal, when it took over the Mello Bank, which at the time headed the private consortium that held 51 per cent of the BCM shares.

Despite initial denials, a formal BIM/BCM merger always looked likely. The two banks shared their computer systems, and had the same chairman, former prime minister Mario Machungo, and the same board of directors.

The new bank takes the name BIM, and thus the acronym BCM, forever associated with massive banking theft and fraud, is consigned to history. The share capital of the new BIM is 500 billion meticais ($22.5 million), and the BCP remains the majority shareholder with 50.4 per cent.

The other shareholders are the Mozambican state (23.1 per cent), the International Finance Corporation (IFC - 16.1 per cent), the state insurance company EMOSE (4.8 per cent), the National Social Security Institute (INSS - four per cent), and a prominent Mozambican NGO, the Community Development Foundation (FDC - 1.2 per cent). The IFC is the public sector lending arm of the World Bank, and its presence indicates the confidence of the World Bank in the new BIM.

At a press conference after the shareholders' meetings, the BIM board defended the merger on the grounds that it would allow "more rational and efficient" use of resources. They said they had received encouragement from the Finance Ministry and the central bank.

Machungo pledged that the new BIM is committed to the modernisation and strengthening of the Mozambican financial system. He denied that the merger was a threat to competition in the banking sector.

The new BIM certainly enjoys an absolutely dominant position in the market, with 48 per cent of total bank credit, and 52 per cent of total deposits. Machungo saw nothing wrong with this - particularly as it was the BIM that had spearheaded modernisation. BIM was the first Mozambican bank to introduce computerised banking, putting all its branches on-line, the first to produce credit cards and the first to install automatic cash dispensing machines. Machungo remarked that some banks had been in the country "for a hundred years", and had not done this.

Two former governors of the Bank of Mozambique, Prakash Ratilal and Sergio Vieira, have criticised the merger as introducing a monopoly that would be damaging to the Mozambican economy.

Machungo pledged that BIM would open more branches in districts which currently have no banks at all. Vieira in particular has criticised Mozambican banks for concentrating their business in Maputo and one or two other large cities, and leaving most of the country without financial services.

Bank fraud put at over $400 million

The cost to the Mozambican state of incompetence, fraud and theft in the two privatised commercial banks, the BCM and Austral runs to over $400 million, according to a report in "Metical" on 3 October.

In the final article of a ten part series on banking scandals, "Metical" writer Joseph Hanlon itemises these losses as $100 million cash injections into the BCM in 1992-96 (the years immediately preceding privatisation), $162 million in BCM bad debt provisions, 2000 and 2001, and $150 million needed to recapitalise Austral following its near collapse in April.

These are only the losses that are reasonably well documented. The frauds discussed by Hanlon in earlier articles imply that total losses are considerably higher.

Hanlon notes that three high-profile assassinations seem linked to bank corruption - Portuguese banker Jose Lima Felix in 1997, investigative journalist Carlos Cardoso in 2000, and Antonio Siba-Siba Macuacua, interim chairman of Austral, in 2001 were all killed "because they knew too much about fraud and corruption in the Mozambican banking system".

Hanlon's research has shown that dishonesty in the privatised banks went well beyond simply borrowing money with no intention of repaying it. There were also cases of "outright theft, money laundering, and illegal foreign exchange dealings. Many people had their hands in the honey pot. Others decided not to look too closely, and are guilty of not carrying out their jobs in the banks".

The banking system was far from healthy in 1996, but it took a dramatic turn for the worse with the bungled privatisations of the BCM and BPD (the pre-privatisation name of Austral). Those privatisations, undertaken without any proper "due diligence" auditing, were rushed through because the World Bank and the IMF insisted on them - even though there was a clear shortage of credible buyers.

And so, writes Hanlon, "a part of the Mozambican elite opted for a tacit deal - the only possible privatisations are going to be corrupt, so let us ensure that we obtain our share" As a result, in both banks, "in the two years after privatisation money poured out to both foreign and domestic partners".

But now it seems to be over. The groups, involving "important families linked to high party and state officials", who ruled the banks for a few short years, have now lost control.

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