The Southern Regional Water Company (ADRS) in Mozambique is facing a financial crisis after accumulating losses exceeding $8.4 million, equivalent to 540 million meticais. The majority of this amount results from debts owed by its customers, including several state institutions, particularly schools and health units.
The situation was disclosed by the company’s Commercial Director, Tomás Langa, during the launch of a debt recovery campaign held in Xai-Xai, in the south of the country. According to Langa, the institutions with the largest debts are located in the provinces of Inhambane and Gaza, where contract defaults have significantly affected the company’s accounts.
Langa stated that state institutions owe around 192 million meticais (approximately $3 million), with most of the debt coming from the health and education sectors. He added that domestic, commercial, and industrial customers are also in default, further aggravating the company’s financial situation.
The director highlighted that, in the province of Gaza alone, non-state customers owe about 300 million meticais ($4.7 million), showing that the problem is not limited to the public sector. He explained that this widespread indebtedness threatens the company’s sustainability, hindering normal operations and the expansion of services.
Accumulated debts have compromised projects to improve and expand the water supply system in the affected provinces. Without recovering these amounts, ADRS faces serious difficulties in investing in new infrastructure and ensuring quality service for the population.
To mitigate the crisis, the company launched a debt renegotiation campaign open to all customers, running until December 31. The initiative allows for a case-by-case analysis of debtors’ financial capacity to find suitable payment solutions. “For example, a customer with a $10 million debt may be able to negotiate extended payment terms depending on their financial situation,” explained Tomás Langa.
The campaign is expected to cover around 5,000 customers, representing approximately 23,000 people. The company hopes that participation in the renegotiation process will reduce financial losses and ensure the continuity of water supply services in the southern region of the country.
Source: Diário Económico
