The Bank of Mozambique (BM) is considering the possibility of including civil society in the governance structure of the Sovereign Fund, in order to make the model more consensual and inclusive.
According to the Bank, the currently proposed governance structure does not integrate civil society, as there are few international experiences, even in the most transparent models.
In cases where it is involved, it participates as part of a supervisory body.
The Central Bank recalls that the work it has been doing aims to reflect on the merits of the various contributions, in order to make the Sovereign Wealth Fund model consensual and inclusive.
The WB considers that there is no incompatibility in assuming the management of the Sovereign Fund, as some organizations have argued that question the idea of this entity managing this account, alleging conflict of interest.
“The governance structure in which the Central Bank appears as operational manager is inspired by models adopted by sovereign funds considered to be a positive reference at the international level in aspects related to the separation of functions, operational independence, prudent management, transparency, accountability and responsibility”, it refers.
According to the Central Bank, it is desirable that the Sovereign Fund be established before the country starts receiving revenues from the production of natural gas from the large deposits in the Rovuma Basin, whose extraction begins next year, in time to create technical and institutional capacity for better management of natural resources, without jeopardizing macroeconomic and financial management.
The financial regulator also defends that an eventual Sovereign Fund will serve to create savings from natural gas revenues and to achieve fiscal stability, protecting and supporting the State Budget in times of unfavorable fluctuation of commodity prices in international markets.
Part of this money will be retained in the fund itself and the other channelled to the State Budget, aiming to finance the construction of infrastructures such as schools, hospitals and roads.
The Bank of Mozambique says that it is currently working on the technical proposal and recommends that the mechanism be managed through the “Santiago Principles”, which advocate values such as transparency, independence, accountability and good governance.
