MOZAMBIQUE: Nyusi turns to China in face of the lack of support in the West

When in April this year the existence of loans secretly contracted by Proindicus and MAM were discovered, the International Monetary Fund suspended financial assistance line of credit to our country. Then the World Bank suspended the approval of new financial aid to Mozambique, while waiting for a new analysis of external debt sustainability as well as the evaluation of the macroeconomic implications. A similar position was adopted by the United Kingdom and also by the 14 donor countries of the European Union. They account for about 10 percent of direct donations to the 2016 State Budget.

In File Club of Mozambique / President Filipe Nyusi (L) with Xi Jinping, Chinese president at the China Africa Forum, in South Africa (Decemebr 2015)

Following the freezing of international aid in the week that just ended, the Minister of Finance of Mozambique, Adriano Maleiane, announced the suspension on hiring civil servants and further cuts in fuel costs, travels of state staff abroad, reduction of funds channelled to public works and other areas with no material impact on the lives of citizens and public institutions.

Although Maleiane has said that health and education will not be subject to reduction in expenses, with the suspension of international aid these basic sectors are bound to be affected. Correcting President Nyusi, who compared these loans to malaria, debts are a cancer that has already dictated the suspension of recruitment of civil servants, mostly thousands of new teachers and health professionals.

Nearly a month has gone by since the IMF began reviewing the documents that the Mozambican executive has provided. The financial institution is also assessing the macroeconomic implications and reviewing the sustainability of external debt.

Faced with lack of Western help, our government turns to the east where transparency and accountability are optional. The head of state is on his way to China. In April, in the wake of the Africa China Forum held in South Africa, the country declared that Mozambique was chosen as one of its “priority partners” for investment, alongside Angola, Egypt, Tanzania, Ethiopia, Kenya and Congo Republic.

These seven countries, according to Li Songtian, director general of the African Affairs Department at the Ministry of Foreign Affairs of China, cited by Zitamar, may access loans totalling US$35 billion and even a fund of US$20 billion for the development of large infrastructure projects such as railways, roads and ports, industrial parks and special economic zones.

A Verdade / Club of Mozambique