Mozambique News Agency

AIM Reports

No.378, 12th May 2009



  • Thousands march on May Day
  • Donors pledge continued support
  • 86 districts receive Cahora Bassa power
  • Riversdale granted mining concession
  • Mozambique to eliminate rice deficit by 2011
  • Maize harvest better than expected
  • Rise in farmers associations in Meconta
  • High growth rate in Nampula province
  • Tax Authority blames financial crisis for losses
  • Assembly approves General State Accounts
  • New President of Supreme Court
  • EIB loan for Sena line and Beira port

  • Thousands march on May Day

    Thousands of workers marched through the streets of Maputo on 1 May on the traditional May Day parade, under the slogan "We don't want to pay for the international financial crisis".

    Addressing the rally at the end of the march, Alexandre Munguambe, general secretary of the larger of the two Mozambican trade union federations, the OTM, said that this year's minimum wage negotiations had been "strongly conditioned by the effects of the crisis". This was why the percentage increases in the sector minimum wages were mostly lower than the rises of 2008. "Just as happened recently with the fuel and food crisis, the effects of this crisis are mostly affecting the workers", he said.

    Mozambican workers did not want to pay the bill left by the international bankers. "We want social justice, resting on the promotion of decent jobs, social protection, social dialogue and work with rights", declared Munguambe. "We want improvements in the working and living conditions of workers, by valuing those who are doing their best to generate wealth and development in Mozambique".

    One specific demand raised by Munguambe was that legislation should be passed granting trade union rights to workers in the public administration. He noted that the government recently announced the start of a wage reform in the public administration, which will see wage rises of between 14 and 28 per cent. "It is our belief that specific legislation on union rights will allow public sector reform to take place in a more participatory and transparent way", he said.

    As in previous years, several contingents on the march took the opportunity to raise complaints specific to their workplace. Thus workers from the Tempografica printing company carried placards declared that their wages have not been paid for seven months. Workers from the UFA clothing company protested that they have gone without wages for seven months.

    Workers of the Spar soft drinks company said their wages had been frozen for the past three years, and demanded respect for the Labour Law and for the company's own collective bargaining agreement.

    Other groups carried banners asking the government "Can you fight against absolute poverty through mass sackings in the companies?" or which declared "Down with the unnecessary recruitment of foreign labour".

    Bringing up the rear of the march were a handful of people who had once worked in the now defunct German Democratic Republic (GDR), and still claim that the government owes them money. A final settlement with the former migrants (known colloquially as "majermanes") was reached in December 2005, with the government paying them $48 million (an average of $3,000 per registered majermane). Despite receiving this huge sum, some of the majermane leadership have demanded more.

    The group on the march carried slogans insulting the current and previous governments. The government of former president Joaquim Chissano consisted of "thieves and assassins", they claimed. Other placards demanded that Labour Minister Helena Taipo be put on trial.

    The majermanes even compared themselves to the sufferings of Jesus Christ - one of them was carried along the march by his colleagues, tied to a cross. But the majermane protests are now down to a hard core - only about 100 were present.

    But much of the parade had little to do with the trade union movement at all, and was clearly sponsored by employers. Marchers came in buses provided by their employers, wore T-shirts of their companies, and had floats that advertised the goods their companies sell - from beer and soft drinks to biscuits and security services.


    Donors pledge continued support

    The 19 donors and funding agencies that provide direct support to the Mozambican budget, known as the Programme Aid Partners, or G-19, have decided that government performance in 2008 was "satisfactory" and sufficient to warrant continued support from the donors.

    The conclusion was announced on 29 April at the end of the annual Joint Review, a process that lasts almost two months in which working groups formed by staff of the government and its partners analyse progress made over the past year.

    Of the 40 targets set for 2008, the government met 20 of them. Some progress was made in 15 others, while five were missed altogether.

    But the outgoing chairperson of the donor group, Irish ambassador Frank Sheridan, told the final review meeting that certain of the missed targets "call for some understanding on our part. An indicator on macro-economic performance was missed because the government responsibly gave a higher priority to dealing with the challenges of rising food and fuel prices".

    Sheridan said the donors believed that the government's poverty reduction policies were bearing fruit. Definitive data was now being gathered that would allow an objective assessment of the impact of the government's Action Plan for the Reduction of Absolute Poverty (PARPA II).

    There had been an improvement in service delivery, the ambassador said, even though this was "still of poor quality", and this "shows the way for a continuous and tangible reduction in poverty".

    Sheridan noted that Mozambique "has gone through a long period of stability and rapid economic growth. However, this growth still does not reflect itself enough in the daily life of the average citizen". The donors were therefore pleased with the government's focus on the rural districts, "because that is where poverty is deepest".

    In previous years, the donors have been sharply critical of the government's failure to combat corruption and of the lethargy of the Mozambican justice system. But this time the tone was quite different. Sheridan said, "there have been a number of developments in relation to the government's fight against corruption. We are encouraged that this sends a signal that Mozambique is showing some commitment to meet the challenge of this great scourge".

    "There are still a number of important steps to be taken in this regard", he added. "We encourage the full development and implementation of the government's anti-corruption strategies and harmonization of the laws with international conventions".

    As for the justice sector, Sheridan stated there had been "some progress". But the only example he gave was the reduction in the number of pre-trial detainees held in prison. Back in 2005, 53 per cent of inmates of Mozambican jails had not been found guilty of anything, but were simply waiting for their trial. The number of such detainees has now dropped to 35 per cent, and Attorney-General Augusto Paulino recently declared that it ought to fall to 10 per cent.

    The Joint Review also looks at the effectiveness of donor aid, and there is an independent evaluation of the donors' performance. There were 20 targets for the donors, only 11 of which were met. Among the problems were the predictability of aid, and the large number of missions sent by individual donors to Mozambique, in defiance of the recommendation that such assessment missions should be jointly held.


    86 districts receive Cahora Bassa power

    Since the current Mozambican government took office in 2005 a further 34 of the country's 128 districts have been connected to the national electricity grid, based on the Cahora Bassa dam on the Zambezi River, Energy Minister Salvador Namburete said on 7 May.

    Addressing the Mozambican parliament, the Assembly of the Republic, Namburete said that by the end of 2004 only 52 districts were receiving Cahora Bassa power. The other 76 received power either through diesel generators or solar panels. Today 86 districts are on the national grid, and power will be brought to a further eight by the end of 2009. That will leave 34 districts to be electrified as from 2010.

    Over the past five years 340,000 new consumers have been connected to the grid, vastly exceeding the modest target of 80,000 new domestic connections set in the government's five-year programme for 2005-2009.

    There are about three million Mozambicans benefiting directly from Cahora Bassa power compared with 1.3 million in 2004, said Namburete. The number of Mozambicans with electricity in their homes had risen from just seven per cent of the population in 2005, to about 14 per cent now.

    The energy strategy for 2009-2013 envisaged connecting at least 90,000 new consumers a year. Namburete said that by the end of this period the number of Mozambicans with access to energy will have reached 17 per cent.

    In 1977, two years after independence, Mozambique had just 300 kilometres of electricity transmission lines, recalled Namburete. Today the figure is over 31,000 kilometres (6,000 kilometres of high voltage lines, 6,000 of medium voltage, and 19,000 of low voltage).

    Electrification had not benefited only the district capitals. 150 rural schools and the same number of health centres had been electrified, as had 40 small towns and settlements. Along the routes of the power lines, tourist resorts and factories had been connected to the grid - including the Marromeu sugar mill on the south bank of the Zambezi, the Moma heavy mineral sands mine and processing plant, and the country's only tobacco processing plant in Tete.

    "The electrification of schools allows night courses to operate, thus contributing to improved literacy and adult education classes", said the minister. "The electrification of health centres makes it possible to increase the number of safe births, and strengthens the cold storage system for vaccines and other materials that need refrigeration".

    Namburete said that studies into the potential of wind power had proved encouraging. A 350-kilowatt wind turbine is being built in Inhambane province, which when connected to the national grid will supply 5,400 people.

    This turbine is being financed by the South African electricity company Eskom at a cost of $1.5 million.


    Riversdale granted mining concession

    The Australian company Riversdale Mining has announced that the Mozambican government has issued it with the mining concession that grants the company mineral rights over coal in the Benga area of Moatize district, in the western province of Tete. Riversdale estimates coal reserves of four billion tonnes.

    When the mine is in full operation it will be mining 20 million tonnes of coal a year, with an estimated investment of over $800 million. Mining is expected to start in 2010.

    Riversdale plans to export the hard coking coal, and use the thermal coal in a power station in the Benga area.


    Mozambique to eliminate rice deficit by 2011

    The Mozambican authorities believe that, if the country keeps up the current trend in rice production, it will no longer have to import rice as from 2011. According to Agriculture Minister Soares Nhaca, within three years the country will be able to cover its rice needs - despite adverse climatic factors, the most recent of which was a storm that destroyed a significant number of rice fields in the southernmost district of Matutuine.

    "Starting from the current agricultural season, we will reduce the deficit in rice supply and, with the Food Production Action Plan, which is part of the Green Revolution, we will eliminate this deficit", Nhaca promised at a meeting in Maputo. Currently Mozambique imports about 315,000 tonnes of rice a year, and consumes around 600,000 tonnes.

    Actions are currently underway across the country in terms of research, extension, the production of improved seeds, and the rehabilitation of irrigation systems, in order to produce rice and other crops.

    Nhaca said that his Ministry has assisted producers by providing certified seeds and teams of oxen for animal traction to help farmers expand the area under cultivation. It is also transmitting technical know-how to raise farmers' productivity. The average productivity of a Mozambican rice field is 1.4 tonnes per hectare, but some other southern African countries manage 3.5 tonnes per hectare.

    Between 2005 and 2008, grain production in Mozambique grew from 1.9 to 2.3 million tonnes, but Nhaca said that "this is still not satisfactory, because we still have an overall grain deficit".


    Maize harvest better than expected

    Preliminary estimates of maize production during the first season of this year's harvest show that it reached 1.9 million tonnes, compared with the expected 1.8 million.

    This is the first harvest since the government in 2008 launched the three year food production plan of action, aimed at reducing the import of wheat and, eventually, stopping imports of rice, and increasing production of other crops that the country needs and has the capacity to produce.


    Rise in farmers associations in Meconta

    There are now over 300 associations of agricultural and livestock producers in the district of Meconta, in the northern province of Nampula, and more are still being legalized, according to district administrator Daniel Bento.

    Presenting a report on 5 May to President Armando Guebuza on developments over the last five years in the district, Bento said that over 90 per cent of the associations grow food crops, and are dependent on the rains for their water. A minority of the associations consist of poultry farmers and some undertake agro-processing.

    Bento stated that food production in Meconta is growing at 20 per cent a year, and that its population of 158,000 is not facing any serious food crises. But there had been some "sporadic" pockets of hunger, due to external factors such as cyclone Jokwe which hit the district in early 2008, destroying fields of cassava.

    In the neighbouring district of Monapo, President Guebuza visited a banana plantation that plans to export the fruit from the port of Nacala as from 2010. This initiative includes plans to build a dam to irrigate 3,000 hectares.

    By 2010, this project expects to be employing at least 3,000 workers, and it hopes to export 120 containers full of bananas every week.


    High growth rate in Nampula province

    Total production in the northern province of Nampula grew by an annual average of 11.8 per cent over the last four years, according to a document from the provincial government presented to President Armando Guebuza on 2 May.

    The most outstanding growth, of 17.9 per cent a year, was in the area of agriculture, livestock and forestry.

    The report states that 3.4 million tonnes of crops were produced in 2008, 90 per cent of which were food crops, mostly grains and cassava. Provincial governor Felismino Tocoli regarded food security in the province as good, due to plentiful harvests over the last two years, regular rainfall, and government incentives for agricultural marketing.

    As for mineral resources, mining operations have begun in new areas rich in precious and semi-precious stones in Moma, Nacaroa, Monapo, Mecuburi and Nacala-a-Velha districts.

    But the most significant investment is that by the Irish company Kenmare Resources in the titanium bearing heavy sands in Moma district. In 2008 the Kenmare dredge mine produced 254,000 tonnes of the ores Ilmenite, rutile and zircon.

    The report notes that in 2008 two new factories processing mineral water opened, in Ribaue and Rapale districts. Production of mineral water has risen from 354,500 litres in 2005 to 1.8 million litres in 2008.

    Authorised investment projects in the province created 5,863 jobs in 2008, compared with 1,233 in 2005.

    Access to clean drinking water remains grossly insufficient in the province - but the number of people who now enjoy such access has risen from 20.7 per cent in 2004 to 36.3 per cent in 2008.

    16 of Nampula's 21 districts are now linked to the national electricity grid, and so the number of consumers in the province of electricity generated at the Cahora Bassa dam on the Zambezi has risen from 32,675 in 2004 to 88,428 in 2008.


    Tax Authority blames financial crisis for losses

    Mozambique could lose about $100 million in tax revenue this year, which the chairperson of the Tax Authority (AT), Rosario Fernandes, blames on the international financial crisis.

    Speaking in Maputo on 5 May, Fernandes explained that this is an estimate made by his institution as part of its work to assess the possible impacts of the international crisis on tax collection "From our calculations, the predicted losses in this sector as a result of the crisis are estimated at $100 million. This is a very high figure, particularly if we take into account that our objective is to collect ever more revenue", said Fernandes.

    He warned that, to prevent companies from taking advantage of the crisis to evade taxes, the AT is intensifying inspections and audits to guarantee transparency in the presentation of financial results.


    Assembly approves General State Accounts

    The Assembly of the Republic on 30 April approved the General State Accounts for 2007, but also demanded that the government take measures against debtors to the state.

    The resolution approving the accounts, drawn up by the Assembly's Plan and Budget Commission (CPO), ordered the government "to take the measures needed to collect the debts owed to the Treasury, and inform the Assembly of the results obtained".

    This refers to foreign aid channelled through the Treasury to a number of companies in the early years of this decade. A couple of the companies concerned have fully repaid the loans, and many more have rescheduled. However, according to the CPO report to the Assembly earlier this month, of the 35 companies that benefited from these loans, 20 have not repaid anything at all.

    As in previous years, the opposition Renamo-Electoral Union coalition voted against approval of the accounts. Whilst Deputies of the ruling Frelimo Party pointed to improvements in the accounts compared with previous years, Renamo alleges that the accounts are proof of government corruption and disrespect for budgetary norms.

    Renamo's Antonio Timba declared that the Accounts were "not complete, exact or clear", contained "unreliable data", and "systematically violated the rules of accounting". He said the accounts were "a collective fraud" by the leaders and cadres of Frelimo.

    Abel Mabunda complained that there was no complete list of state assets, and that the Accounts made no provision for the revaluation or depreciation of assets. He claimed that the government was not interested in collecting the debts to the Treasury.

    Mabunda noted that one of the debtors, the mineral water company Aguas Vumba, was reported as offering $30,000 to a football league, "but doesn't pay off its debt to the Treasury".

    Frelimo deputies retorted that the whole idea of drawing up one annual set of accounts on budget implementation, to be audited by the Administrative Tribunal, had come from Frelimo a decade ago. The 2007 accounts contained much more information than the accounts of previous years, and showed that the government was, in fact, complying with the legislation on public financial management.

    Damiao Jose said the accounts showed that the government had respected the ceiling on expenditure imposed by the budget approved by the Assembly, and had collected more revenue than forecast.

    "Advances do not come from insults, but from hard work", he said. The "obstructionist manoeuvres" of Renamo merely "indicate its despair".


    New President of Supreme Court

    President Armando Guebuza on 23 April appointed Ozias Pondja as the new President of the Supreme Court.

    Pondja has a distinguished career in the judicial system. He was chief attorney in Zambezia province in the late 1970s, and was then presiding judge in the provincial courts, first in Cabo Delgado and then in Zambezia. He has been a member of the Supreme Court for the past decade.

    He replaces Mario Mangaze, whose five-year term of office has expired. Mangaze served four terms of office, for a total of twenty years at the head of the Supreme Court.

    President Guebuza also appointed Machatine Munguambe as President of the Administrative Tribunal, the body responsible for overseeing the legality of public expenditure. He replaces Antonio Pale, whose term of office has also expired.

    Munguambe was once director of the law faculty at Maputo's Eduardo Mondlane University. His most recent position has been vice-chancellor of the police academy.

    In a third dispatch, President Guebuza appointed Luis Mondlane as Chairperson of the Constitutional Council, the supreme body on matters of constitutional law. It is also the Council that has the final word in electoral disputes, and proclaims and validates election results.

    Mondlane was previously a Supreme Court judge, and is also president of the SADC Tribunal.

    He replaces Rui Baltazar, again because his term of office has expired.


    EIB loan for Sena line and Beira port

    The Mozambican government and the European Investment Bank (EIB) signed in Maputo on 30 April agreements for a loan of €65 million (about $86 million) for the development of the Beira port and rail network in the centre of the country.

    Of this sum, €42 million will go towards completing the reconstruction of the Sena rail line, which runs from the port of Beira to the coal basin of Moatize in Tete province.

    This sum supplements the $100 million already disbursed by the World Bank and €48 million from the shareholders of the Beira Railroad company (CCFB) itself to rebuild the 665 kilometre line. The Sena line will be key to moving coal exports from Moatize to Beira.

    The other €23 million of the EIB loan is to finance emergency dredging of the Beira port access channel. This project has already been funded by Denmark and Holland to the tune of $13 million. The EIB loan is repayable over 20 years, at an interest rate of two per cent.



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