Let Justice do its job, urges Nyusi

Mozambican President Filipe Nyusi on Friday declared that the bodies of the administration of justice must be allowed to do their job in prosecuting anyone responsible for criminal activities in the scandal of the country’s “hidden debts”.

Speaking in his capacity as President of the ruling Frelimo Party, at the end of a meeting of the Party’s Central Committee in Maputo, Nyusi said that now is the time for the Attorney-General’s Office to work on the results from the independent audit which showed “there were irregularities that might indicate crimes” in the contracting of the debts.

“It is time to allow justice to work within the spirit of the separation of powers”, declared Nyusi. This is the clearest indication so far that the President will not stand in the way of prosecutions of members of the previous government, headed by his predecessor Armando Guebuza, who were responsible for illegally guaranteeing loans for over two billion dollars, contracted in 2013 and 2014 by the security-related companies Ematum (Mozambique Tuna Company), Proindicus and MAM (Mozambique Asset Management) from the European banks Credit Suisse and VTB of Russia. While the 850 million dollar loan to Ematum was in the public domain, since it took the form of a bond issue in Europe, attempts were made to keep the loans to Proindicus (622 millon dollars) and MAM (535 millon dollars) secret. When the scandal finally erupted into public view in April 2016, the International Monetary Fund (IMF) suspended its programme with Mozambique, and other western donors and funding agencies also cut off their financial aid.

The IMF made it clear that an international, independent audit of the three companies was a basic condition for resuming normal relations. The PGR thus hired Kroll Associates, regarded as the world’s foremost forensic auditing company, to undertake the audit. The PGR published the executive summary of the audit report in June, in which Kroll protested that it had not received full cooperation from the companies. The information they provided was incomplete, and thus failed to give a complete picture of the debts. To make matters worse, Antonio do Rosario, the agent of the State Security and Intelligence Service (SISE), who is the chairperson of the three companies, in a message widely reproduced on social media, boasted that he had obstructed the audit and even expelled the Kroll auditors from his office. Since Kroll as working for the PGR, Rosario’s actions clearly constitute the crime of obstruction of justice. The failure to cooperate with the audit clearly angered the IMF, which has demanded publication of the full Kroll report, and shows no sign of agreeing to a speedy resumption of its programme with Mozambique.

But even the incomplete audit drew damning conclusions. Kroll compared the prices on the invoices of assets purchased, such as Ematum’s fishing boats, and the patrol vessels of Proindicus, with an independent valuation and found a discrepancy of 713 million dollars. It was also impossible to account for 500 million dollars of the Ematum loan supposedly used for military purposes. As for the guarantees for the loans, given by the Guebuza government, it was clear, even before Kroll was hired, that these were illegal. They smashed through the ceilings on loan guarantees fixed in the 2013 and 2014 budget loans. They were also unconstitutional, since a clause in the Mozambican constitution establishes that only the country’s parliament, the Assembly of the Republic, can authorise such debts.

“As we always said”, Nyusi told the Central Committee, “it is in the interests of the government and of the entire Mozambican people, that the investigations clarify the contours of this case, which involves national institutions, and international suppliers and banks”. He pledged that the government will continue to cooperate with the PGR in implementing the recommendations from the Kroll report. The government would not make any “pre-judgment”, he promised, since that would “run the risk of usurping powers that belong to the judiciary”.

“International experiences have shown that cases of this kind have required time for investigation”, added Nyusi. “The government will continue to provide its support in order to contribute to greater speed in this process”. He added that the government is drawing up a Plan of Action “intended to strengthen the mechanisms for managing the public debt, and boosting transparency in managing public assets”. Nyusi stressed that the country’s agenda should not be reduced just to clearing up the debt scandal, and so he once again urged Mozambicans to work for increases in production and productivity, in order to advance the overall development of Mozambique.