The country’s economic week was marked by major issues, including the announcement of the sale of Linhas Aéreas de Moçambique (LAM), the guarantee that US funding will be made available in the coming weeks for the Rovuma basin liquefied natural gas (LNG) project and the unveiling of the new fiscal management plan valued at more than 80 million dollars.
In general terms, the government made it known that it will sell 91% of the state’s shares in LAM through private negotiation, authorising the public companies EMOSE (Empresa Moçambicana de Seguros), CFM (Caminhos-de-Ferro de Moçambique) and HCB (Hidroeléctrica de Cahora Bassa) to acquire the state’s stake in the airline.
During a session of the Council of Ministers, Inocêncio Impissa said that the estimated amount to be raised from the sale of state shares is around 130 million dollars (8.3 billion meticals) and will be used to purchase eight new aircraft and restructure the company.
In the past, in an attempt to save ‘the flagship company’, the former government announced a partnership between LAM and Fly Modern Ark (FMA), which came about at a time of great difficulty for the carrier, which was facing a series of operational problems. The difficulties were associated with a limited fleet and a lack of investment, factors that contributed to some operational incidents, albeit without casualties.
Meanwhile, during its management, Fly Modern Ark identified embezzlement schemes in LAM’s operations, which resulted in losses of 222 million meticals, facilitated by automatic payment terminals (TPA/POS) not controlled by the company, but which were used in ticket shops.
These allegations led Mozambique’s Central Office for Combating Corruption (GCCC) to open an investigation, which is still underway, aimed at ascertaining responsibility for the fraud and assessing the company’s fleet management.
In another development, the country received a ‘message of hope’ about the realisation of one of Africa’s most important LNG projects, led by France’s TotalEnergies, in the Rovuma basin, Cabo Delgado province, in northern Mozambique.
On 5 February, the CEO of TotalEnergies, Patrick Pouyanné, revealed that the Export-Import Bank (Exim) of the United States of America (USA) could approve the financing of 4.7 billion dollars in the coming weeks, stressing that other credit agencies will do the same in the following months.
Patrick Pouyanné, who was speaking to journalists after the release of the 2024 fourth quarter earnings, also said that ‘the project’s completion date will have to be postponed from 2027 to 2029-30.’
Exim had promised most of the funding for the LNG project valued at 20 billion dollars. However, it was suspended the following year due to an Islamic insurgency that attacked the Cabo Delgado region, forcing the oil company to declare ‘force majeure’ and withdraw its local team before any disbursement was made.
On Thursday (6), the Executive revealed the existence of a project to manage public resources and provide services, an initiative budgeted at around 84 million dollars (5.3 billion meticals), as part of the economic reforms.
According to a statement released by the Ministry of Finance, ‘this strategic initiative aims to improve fiscal management, budget execution and transparency in the administration of public resources, reinforcing the quality of services provided to the population.’
The Public Resource Management for Service Delivery Project (Gepres) will be implemented in partnership with the International Development Association (IDA, World Bank) and the Multi-Donor Fund, supporting reforms in public finances and fiscal decentralisation.
Text: Cleusia Chirindza
