Corruption stronger than colonialism?

Mozambican President Filipe Nyusi, speaking in his capacity as President of the ruling Frelimo Party, declared on Tuesday that the fight against corruption is the most vital and urgent challenge facing the country.Addressing the opening session of the 11th Congress of Frelimo, in the southern city of Matola, Nyusi declared “under the rule of law, leaders must first serve the people and the country. If we were able to overcome colonial rule, we have to be able to win the battle against corruption. And if we were able to silence the guns (a reference to the 1992 peace agreement that ended the war of destabilization), we also have to be able to fight against organized crime, and to build a country made by and for all Mozambicans”.

“Zero tolerance towards corruption must begin in our own ranks”, he told the 2,249 Congress delegates present. “It should be the norm from the top to the grass roots. Nobody should abuse their position. This Congress should be proof that such abuses – bribery, extortion, and all other violations – must not go unpunished”.

Nyusi also spoke up for social justice. “We don’t want to be part of a society where the rich suffocate the poor”, he said.

The wealth of the country’s natural resources should unite all Mozambicans, he urged. The riches in the country’s soil and sub-soil “should be a blessing, not a curse”, he said, insisting that debates at the Congress should feed a long term vision about this matter.Nyusi did not want the country to stagger from one ad-hoc solution to the next. “We do not intend to govern just through campaigns and projects”, he said. “We need strategic solutions and a culture of looking ahead”.

“Governance should not be limited to solving problems”, he added. “Governance should mean that problems don’t happen”.

Nyusi warned against intolerance. “Diversity of opinion is not a sign of weakness, but of tolerance”, he stressed. “The debate of ideas, however different they may be, must continue to be promoted, in the awareness that we are living in a more open society”.

Living in a multi-party democracy means competing for power, he said, “and for this, we do not need to act against adversaries, but to build, with paths and solutions, a prosperous Mozambique, showing the people that we are the best solution to their longings”.

The country is now on the path to economic independence, Nyusi argued. “We want to build a diverse and diversified economy to guarantee lasting wealth, and a more self-sufficient country”.

“Let us work to attract investment, and to place agriculture to the forefront, and with public services that do not encourage exchanges of favours and games of influence”, he declared. “We want access to energy and to technologies for citizens. We want circulation of goods and people, but above all, of ideas, giving young people the tools so that they can become the patriots and citizens of their time”.

He expressed forthright support for decentralization, pointing out that Frelimo had once been a pioneer in decentralizing power.The backdrop to this part of his speech, although not specifically mentioned by Nyusi, is the demand by Afonso Dhlakama, leader of the Renamo rebels, for the direct election of provincial governors. This has been one of the themes of the negotiations over the phone between Nyusi and Dhlakama, and a working group between the government and Renamo is drawing up draft legislation and a constitutional amendment on the matter.Nyusi said he wanted the experience of participatory management to be enriched, “without conflict between decentralization and the preservation of the greatest gain of Mozambicans, national unity.“We should be prepared to make changes”, he urged, “and continue to play a leading role n decentralizing the country”.

Northern Mozambique logistics alliance

Subtech Mozambique, Alpha Logistics and LBH Mozambique have recently signed an MoU to enhance their suite of services in Mozambique to be able to offer a holistic logistics and services solution starting specifically with activities in and around the small but strategically located port of Mocimboa da Praia.

All three of the companies in the Mocimboa Alliance have a long history in Mozambique operations and have been involved in or had some input in almost every capital infrastructure related project in Mozambique.The Mocimboa Alliance will culminate in a specially focused joint venture company within months but is already capable of combining their individual offerings to be able to service all marine or logistics based requirements. The joined capabilities of the companies make a powerful, robust and dynamic logistics solution ideally suited for the environment and infrastructural development ahead in Northern Mozambique.The MoU conjoins the strengths and abilities of the Mocimboa Alliance covering diving, materials handling, clearing and forwarding, ships agency, waste management and environmental services.LBH Mozambique MD, Athol Emerton stated “LBH has been active along with Subtech and Alpha on the Mozambique coast for decades. It just makes good sense to combine our capabilities in the strategic port of Mocimboa da Praia, literally the closest port to the oil and gas development at Palma. We have no doubt that bigger and more efficient facilities will be built with better draft solutions but right now it is the most convenient logistics hub. Furthermore, the customers don’t have to re-invent the wheel, I am confident that between the three Alliance partners we can create a rapid logistics solution for materials in and out of Northern Mozambique”

Arif Kurji, Director of Alpha Group, based in Mombasa has also stressed that the plateau of Northern Mozambique poses a unique set of challenges due to the extended length of its continental shelf. This is one of the reasons that Alpha Logistics has, over the last three years, invested in a set of specialised multi-purpose units to suit shallow draft conditions. The investment includes multi-purpose specialised landing crafts, barges, shallow vessels, and jack-up’s suited for the Afungi area.

The synergy between Subtech, LBH and Alpha Logistics perfectly complement one another to comprehensively cover a wide array of services. More importantly, the three companies all have a vast amount of local knowledge and experience, having all been based in the region for the last 30 years.

Neil Scott Williams, Managing Director of Subtech Inshore, sees enormous synergy and practical solutions based on sound local knowledge “Subtech has been established in Mozambique for 15 years and has developed a world class maritime services offering in-country through local investment and skills development. Offering a logistical solution, based on the combined capability and in-country presence, skills and facilities of Subtech, Alpha and LBH, will produce innovative and client-centred solutions to logistical challenges in the region”.

277,000 Carats

Highly successful production ramp-up puts Mustang on track to offer more than 300,000cts at its maiden tender next month compared with initial target of 200,000cts. Mustang Resources (ASX:MUS) (OTCMKTS:GGPLF) is pleased to announce that its ruby inventory has soared to 277,852 carats.The outstanding result means Mustang’s inventory is set to comfortably exceed 300,000 carats by the time of its maiden tender, which will be held over four days from Friday 27 October to Monday 30 October in Port Louis, Mauritius.This compares with Mustang’s initial goal of accumulating a 200,000-carat inventory in time for the auction.The substantial growth in the inventory stems from record production rates at Mustang’s Montepuez Ruby Project in Mozambique and strong results from the Company’s artisanal miner development program (AMDP) following the implementation of “bushman jigs” and sorting tables.Mustang Managing Director Christiaan Jordaan said the rising production rates and inventory coincided with very strong interest in the tender from ruby customers around the world.

“The planets are aligning perfectly for our maiden tender,” Mr. Jordaan said. “We have exceeded our most optimistic inventory targets and all the feedback we are getting points to strong demand for rubies among global customers.

“Our tender inventory will be significantly higher than we had expected, opening the door to increased sales and revenue for the Company.“The increased inventory will also help attract leading ruby buyers from around the world, who are looking for critical mass as they seek to meet the strong demand for these stones.”Listed on the Australian Securities Exchange, Mustang Resources Limited is an emerging gemstone developer and producer focused on the near-term development of the highly prospective Montepuez Ruby Project in northern Mozambique.The Montepuez Ruby Project consists of four licences covering 19,500 hectares adjacent to the world’s largest ruby deposit discovered by Gemfields PLC in 2012. Since supply of rubies from sources outside Mozambique has become fractured and unreliable, Mustang stands to capitalise on the current demand around the world for ethically produced rubies by becoming a reliable, consistent supplier of high-quality rubies.The Company is fast-tracking its work program on the Montepuez Ruby Project with high priority targets being identified and low-cost bulk sampling well underway. First rough ruby sales are scheduled for October 2017 under a closed bid tender of an estimated 200,000 cts gem quality rubies.

Growing 5% a year through to 2021

The Economist Intelligence Unit (EIU) believes that Mozambique will continue to be a two-speed country and that the government is not committed to investment-friendly policies despite the need to win back investors.In an analysis of the government’s efforts, experts from the economic analysis unit of The Economist magazine write that “after a tumultuous year the government is eager to convince foreign investors that Mozambique is open to business”.However, they added in the analysis that Lusa has access to, “it did not accompany the recently launched charm offensive with substantive efforts to improve the business environment.”

The Economist analysts cite the recent travels of the country’s president, who in the past six months has been to Europe, the United States and Asia, returning with promises of investment from major oil companies such as Eni or Shell.

The problem, they point out, is that “these investments are almost exclusively focused on the growing gas sector”, and would take place regardless of the country’s internal problems because “the profit margins in these operations, which are the cheapest in the world, are too appealing for investors to turn their backs on”.Economic growth based entirely on foreign direct investment focused on export-oriented projects “will hardly lead to comprehensive growth in a low-income country with high poverty rates and a rapidly growing labour market”.The analysts acknowledge that the government knows that the economy needs to be diversified and hopes to attract investment in tourism, agriculture and manufacturing to protect the economy from raw material price volatility and create jobs, but, they warn, “investment opportunities in these non-energy sectors are less attractive” and with slower and lower rates of return.That is why, they say, “Mozambique’s economy will continue to be a story with two parts, with relatively rapid growth in the extractive sectors but a much slower performance in others, which will cause the expected growth rate to remain at five percent per year until 2021, while a significant improvement in living standards remains unlikely”.

EUR 20 million Conservation Tourism investment

The Mozambican Council of Ministers has authorised a joint South African-American tourist investment estimated to be worth EUR 20 million.“The resolution provisionally authorises Nuanetsi’s request for the acquisition of Land Use Title (DUAT) covering an area of 17,900 hectares,” Deputy Minister of Culture and Tourism Ana Comoana announced yesterday.The area in Mapulanguene, Magude district, Maputo province, will become a Conservation Tourism project, and the initiative includes the construction of a lodge and ten tourist villages as well as social infrastructure including access roads and a school.Minister Comoana said the project would create employment for around 110 Mozambicans.

 Yesterday’s cabinet meeting also approved the Transfer Pricing Regime to be applied in commercial transactions “involving related entities” or occurring “between sectors or parts of the same entity”.The adoption of this scheme aims to “establish parity in the tax treatment between companies integrated in groups and independent companies”, as well as neutralising “tax evasion practices” and ensuring “the proper protection of the internal tax base, to safeguard tax revenues”.The Council of Ministers also approved the National Broadband Strategy, aimed at “encouraging the development of infrastructure” and rolling out “information and communication technologies at the national level through the implementation of access networks, regardless of support technologies”.

‘Bibimoney’

The new Bibimoney platform launched in Maputo yesterday will facilitate international money transfers between different telephone operators.The initiative comes at a time when Mozambican phone users are able to conduct transactions with customers of compatible phone operators only. The new platform aims to make transactions possible regardless of the operator.The project will cover all districts in the country, leading academic Celina Come to remark that that there is a need to look at technology coverage country-wide, if one wishes to talk about FinTech (financial technologies).“Experience shows that Mozambique can advance in the use of mobile accounts,” Come says. “We only have to remember that almost half the Mozambican population has access to mobile phones to sense that a large part of them will be using mobile banking services.”Operator representatives, economists, insurance companies and others took part in the launch ceremony. African countries including Malawi, Tanzania, Kenya, Nigeria are already on the platform.

Is one of the world’s 30 New Promises

Renowned Mozambican choreographer and dancer Panaibra Gabriel Canda was recently distinguished by the prestigious German magazine TANZ (Dance, Ballet and Performances),  in a “New Promises for the Future of Dance 2017” list of 30 international artists.Forty-one-year-old Panaibra Gabriel Canda was born in Maputo, and has enjoyed a 22-year career in music, theatre and dance since completing his training in contemporary dance with the Festival Danças na Cidade in Lisbon.In 1998, he founded CulturArte, an institution that provides support for artistic development and has developed artistic projects including creations, performances and training programmes for dance projects and local artists.

The TANZ shortlist is the result of extensive research among 42 international dance critics as well as thousands of the magazine’s readers.Speaking to KINANI, Canda said: “I feel happy and honoured to receive this distinction, which shows real growth, another place that Mozambique conquers in the world of contemporary dance. I hope it will increase my motivation and that of other national creators to continue to write well and in capital letters the contemporary history of our beautiful Mozambique.”

Among the 30 artists, dance companies and institutions named, another highlight is the Portuguese choreographer and dancer Marlena Marlene Monteiro Freitas (of Cape Verde origin), who was present at the 2016 International Week of Contemporary Art – Tridisciplinar.Among the 30 Artists, New Promises for the Future of Dance, according to TANZ magazine are: Spanish Juanjo Arqués, Het Nationale Ballet, Amsterdam; The Canadian Daina Ashbee; The Frenchman Etienne Béchard; The German (born in Romania) Adolphe Binder, new director of the Tanztheater Wuppertal, founded by Pina Bausch; The Mozambican Panaibra Gabriel Canda; The duo of choreographers based in Lyon (France) François Chaignaud, Cecilia Bengolea; Scottish Reece Clarke of the Royal Ballet of London; The new building of the John Cranko School of Ballet in Stuttgart, the Burger Rudacs studio in Munich; The Italian Gigi Cristoforetti; The Australian Jessica Fyfe; The Portuguese Marco da Silva Ferreira; The Italian collective Dewey Dell (Teodora, Demetrio, Agata Castelucci and Eugenio Resta); The Italian choreographer Mauro de Candia; The Finnish-Egyptian Samira Elagoz; The German Birgit Freitag; The Austrian Brigitte Fürle, artistic director of the House of the Festival of St. Pölten; The Spanish bailaor Eduardo Guerrero; The Austrian Rebecca Horner; The Greek Euripides Laskaridis, founder of the company Osmosis; The American Julian Amir Lacey; South Korean I Jung Lim; The Finnish collective Marble Crowd; The Cape Verdean Marlene Monteiro Freitas; The Spanish Emilio Ochando; The Swedish Johannes Öhmann, from 2018 co-director of the Staatsballett Berlin (after the disaster left by the Spanish Nacho Duato); The British Adam Russell-Jones; The Dutch Arno Schuitemaker; The Franco-German Claire Vivianne Sobottke; The American Brandon Washington; And Austrian Prisca Zeisel, a new acquisition of Bayerisches Staatsballett in Munich.”

DOMESTIC AIR ROUTES OPENED TO COMPETITION

For the first time ever, foreign airlines have been authorized to operate domestic routes within Mozambique.The routes were put out to tender earlier this year and, announcing the results at a Maputo press conference on Tuesday, the chairperson of the Mozambique Civil Aviation Institute (IACM), Joao Abreu, said that Ethiopian Airlines and Malawi Airlines successfully applied for authorization to fly the domestic routes.

Five Mozambican companies have also been authorized – namely Mozambique Airlines (LAM), its subsidiary Mocambique Expresso (MEX), the air transport division of Mozambique Railways, CFM Transportes Aereo, the long established light aircraft company TTA, and Solenta Aviation Mozambique. Solenta is the Mozambican subsidiary of a South African company which, up until now, has specialized in charter flights.

Ethiopian Airlines, LAM and MEX have applied for all the domestic routes, while the other companies are only interested in some of them (Abreu did not say which). Since Ethiopian Airlines is widely regarded as the most professional of the African airlines, the tender result means that LAM will now face serious competition.The seven companies whose bids were successful now have 180 days to put the routes into operation. Ethiopian Airlines and Malawi Airlines must first register as Mozambican companies, and obtain the requisite licence in accordance with Mozambican legislation. Abreu said that the priority must be the needs of the passengers. “We have to look at the market in an overall fashion”, he said. “What we want is for the users to have more choice”.

As for international routes, the successful bids only came from Mozambican companies – LAM, MEX, TTA and CFM. Malawi Airlines also put in bid but was not selected.Abreu said there was a disappointing response to the tender for regional and international routes, and so, within 60 days, a second tender will be launched for routes from Mozambique to Tanzania, Brazil, Singapore, Turkey, Ethiopia, Malawi, Kenya, Mauritius, Vietnam and Qatar.Some of these routes are, in fact, already operated – Maputo-Dar es Salaam by LAM, Maputo-Istanbul by Turkish airlines, Maputo-Addis Ababa by Ethiopian; Maputo-Nairobi by Kenyan Airlines, and Maputo-Doha by Qatar Airways. There have never been any regular flights between Mozambique and Brazil, Singapore or Vietnam. 

POWER TO REACH DOA IN FEBRUARY

Electricity from the Cahora Bassa dam on the Zambezi will reach the district of Doa, in the western Mozambican province of Tete, in February 2018, according to the Doa district administrator, Domingos Viola.Doa is one of two new districts in Tete, which began to operate with a district government in June 2014. Previously it was an administrative post in Mutarara district. Doa town relied on a generator to provide electricity. The second new Tete district, Marara, already benefits from Cahora Bassa power. Viola said that the topographic survey of the area through which the electricity transmission lines will pass has already been done. The pylons have already arrived and will soon be put in place. The transmission line will reach Doa from the neighbouring district of Moatize. In addition to Doa town the line will benefit Chazia and Chuez communities, as well as the villages of Madhamba, Kambulatsitsi and Necungas in Moatize. In all, the new line is expected to benefit more than 40,000 people.Because of financial constraints, the generator in Doa only operates for four hours a day. “We don’t always switch on the generator because the costs are high”, said Viola. “To run for four hours a day, the generator needs 40 litres of diesel, and we don’t manage to buy that every day. So we spend most of our nights in darkness”.

Viola said the Doa public, and the district government, have enormous expectations from the impending connection to the national grid. He was confident that electrification would stimulate development of the district by, for example, allowing flour mills to run on electricity rather than diesel. “We shall also introduce a night course in to schools, so that people can study”, he added. 

“So we’re eager”, said the administrator. “The contractor gave us a guarantee that the installation would be completed within six months. So we hope that in February our district will be illuminated with power from Cahora Bassa”. Viola did not say what the cost of electrifying Doa would be, but declared “for us, what is important is to have permanent lighting in the town, and even domestic electricity connections, so that people can create better conditions for their lives”. After Doa is electrified there will be only one district in Tete that does not receive power from Cahora Bassa. That is Zumbo, in the far west of the province, which obtains its electricity from Zambia. 

GO-AHEAD TO SALE OF ROVUMA BASIN

The Mozambican government believes that by the end of this year it could receive hundreds of millions of dollars in capital gains tax arising from the sale of shares in the Rovuma Basin Area Four gas fields in the far north of the country.This arises from the deal whereby the Italian energy company ENI sells half its holding in Area Four to the US oil and gas giant, ExxonMobil. This deal should net the Mozambican state 354.5 million US dollars. Speaking to reporters on Tuesday, at the end of the weekly session of the Council of Ministers (Cabinet), the Minister of Mineral Resources and Energy, Leticia Klemens, said the government has approved a decree altering the terms and conditions of the complementary accord to the Area Four Concession agreement, under which ENI is exploring for oil and gas. 

The decree gives the go-ahead to the sale of shares to ExxonMobil, and allows ENI to delegate to ExxonMobil the powers of operator for all operations to liquefy natural gas on shore. ENI is already pushing ahead with a floating liquefied natural gas (FLNG) platform above the Coral South gas field, about 40 kilometres from the coast of Cabo Delgado province. But Coral South is just one of several fields in Area Four, and gas from other fields will be liquefied onshore, at facilities in the Afungi Peninsula, in Palma district, under the responsibility of ExxonMobil. 

Klemens said approval of the sale of shares to ExxonMobil will bring advantages to Mozambique, since “ExxonMobil is a major company, with technical competence, including in gas liquefaction operations, and it is financially robust. It is one of the great world leaders in the natural gas market”.  “For Exxon Mobil to enter, we, as the government had to authorise its entry”, the Minister said. “The government has now given its authorization”.Under the payment terms, ENI must pay the capital gains tax within 30 days of concluding the negotiations between ENI and ExxonMobil. ExxonMobil is paying 2.8 billion dollars for half of ENI’s shares in Area Four. ENI controls a 50 per cent indirect interest in Area Four, owned through ENI-East Africa, which holds 70 per cent of the concession. The remaining 20 per cent held via ENI-East Africa belongs to the Chinese company CNPC. The other three partners, with ten per cent each, are Galp Energia of Portugal, Kogas, and Mozambique's National Hydrocarbon Company .