The Mozambican Contractors Federation (FME) accused the State on Thursday, March 19, of accumulating debts of over €219.8 million in road construction works, warning that companies are closing due to lack of payments.
“It is a very high amount, and companies have already lost capacity. Even large companies are now turning to banks to pay salaries, which is serious, whereas the proper approach would be to go to banks for investments and to execute works,” said FME President Bento Machaila at a press conference held in Maputo.
Machaila added that the debt is very high and that the FME has no proof that the Ministry of Finance has paid the full amount accumulated over 10 years, including the costs of company interventions following the recent cyclones in the Northern and Central regions of the country, as claimed by the government.
He recalled that the country now needs these companies to address the current problems caused by floods during this rainy season, which ends in April, and which alone has affected around seven thousand kilometers of roads nationwide.
“Without financial capacity, it will be difficult to meet the demands. What is happening now is that international companies are the ones carrying out these works and invoicing, as has unfortunately been the case. If a contractor is not properly paid, it will lose cash flow capacity to invest in the works,” he lamented.
In addition to the accumulated debt, the FME complained about the exclusion of national companies in favor of international ones for executing projects. “What we are demanding is not preferential treatment as Mozambicans; we are simply asking for equal treatment among competitors. Because, so far, the way the legislation was revised in 2022 actually favors international companies.”
Bento Machaila also called for a revision of the decree that coordinates contractors’ activities, especially regarding State procurement tenders. “What we advocate is that international companies should work alongside national ones to facilitate knowledge and experience transfer.”
According to Machaila, the federation receives weekly reports from companies announcing closures due to unsustainability caused by lack of payments, adding that each month up to 12 companies can be in the same situation.
Source: Diário Económico
