Africa Confidential

President Filipe Nyusi's new era – a decisive break with the policies and personalities of ex-President Armando Guebuza – has begun with an apparent financial disaster. His officials report that the Treasury has far less money than had been expected. One unofficial but conservative estimate put the shortfall at about US$900 million, much of it anticipated tax revenue from oil companies which may have been illegally waived. Some say this depletion of the exchequer is an act of revenge by supporters of Guebuza intent on damaging Nyusi's prospects. Insiders speak of a massive increase in pillage from within the highest circles of government as Guebuza's term ended, some of it so crude that it could have legal consequences. The estimated $725 mn. cost of the Catembe Bridge in Maputo, for example, is double what it should have been, we hear, in order to accommodate massive kickbacks. As well as the missing millions in public funds, there is also believed to be a vast sum missing from the proceeds of the Ematum bond (AC Vol 55 No 3, Donors up in arms). Around $600 mn. of the cash raised on the $850 mn. bond, which is private finance but is backed by a state guarantee, has disappeared, according to a source close to the company. Ematum made a $10 mn. loss in its first year of operations, and with no means to pay the high monthly interest on the bond, the state may end up stuck with the bill. Such is the growing concern about Ematum that Maputo insiders believe it was no coincidence that both Nyusi and Prime Minister Carlos Agostinho do Rosario failed to appear at an Ematum event on 9 April at which they were expected. The new Minister of Economy and Finance, Adriano Maleiane, is demanding answers from Guebuza's government and in particular from ex-Finance Minister Manuel Chang, we hear (AC Vol 56 No 2, New cabinet brooms and Vol 54 No 22, The mystery ship deal). There is widespread speculation in the city that, even if the new government does not want to stir up trouble within the governing Frente de Libertação de Moçambique (Frelimo), the financial hole is so vast that it may have no option but to prosecute members of Guebuza's government and their friends in order to recover some money. At the same time, the new team at the Finance Ministry is said to want a re-assessment of a multimillion dollar tax break granted to the Italian oil giant ENI (Ente Nazionale Idrocarburi), which Guebuza negotiated privately (AC Vol 56 No 5, A shot at devolution).

Clean break

Nyusi's accession to power and Guebuza's resignation as Frelimo Chairman mark the most abrupt break in continuity at the top since Independence in 1975 (AC Vol 56 No 7, A farewell to Armando). Until the resignation, there were fears that his barely concealed fight with his successor as state President could derail the country's development plans. His way clear and his battle won, Nyusi must now make good on his promises of change, Maputo pundits say. Since his inauguration as national President in January, his predecessor had tried to interfere with his orders to ministers and to prevent him from negotiating personally with the leader of the Renamo Party (Resistência Nacional Moçambicana), Afonso Dhlakama. Nyusi's serenity in the face of this onslaught won him respect. During Frelimo's three-day Central Committee meeting which opened on 26 March, Guebuza dug his own political grave as he alienated former allies so thoroughly that they turned on him on the final day. He fell on his sword the following morning, Sunday 29 March, and Nyusi was then voted in as the new Party President. He lost only three votes – one blank and two spoiled – which we hear were those of Guebuza, his wife Maria da Luz Dai Guebuza and their businesswoman daughter, Valentina da Luz Guebuza. Word about the meeting has recently emerged. Although Guebuza's friends warned him that he needed to preserve his dignity – and in all probability his business interests – by surrendering

gracefully, he was apparently blind to the danger he was in. As a result, the backlash deeply shocked him as former loyalists such as a former Foreign and later Environment Minister, Alcinda Abreu, angrily backed earlier accusations that Guebuza controlled the party through intimidation. In the end, it was his hubris that weakened his judgment and left him isolated. The independent newspaper Savana summed it up in a front-page headline: 'Abandonado'. The accompanying photograph showed a crestfallen ex-President. The long view sees Guebuza's downfall as a sad end for a leader who brought in improvements in infrastructure, greater foreign investment and increased professionalism amongst state officials. However, this gave way to increased insecurity and violence as weak and corrupt institutions undermined business and failed to spread the benefits of economic development to the population. Guebuza surrounded himself with people widely seen as mediocre sycophants, such Edson Macuácua and party Spokesperson Damião José (AC Vol 55 No 22, Nyusi's rocky road). José has been sacked and there is talk in the party of replacing staff on the Secretariat.

Renamo profits

Rescuing the state finances will be one of Nyusi's greatest challenges, along with the seeminglyimpossible task of achieving lasting peace with Renamo. Buoyed by the internal conflict in Frelimo,Dhlakama seems resolved to escalate his demands. Nyusi is inclined to negotiate but there will be a limit to what he can give. Frelimo's fraud during the last elections was extremely widespread, most now agree, but Dhlakama's claims of outright victory remain implausible (AC Vol 55 No 21, Frelimo wins, Renamo revives). It is unlikely Renamo would be allowed to rule in all the provinces that voted its way and Frelimo members are not the only ones who see dangers in regional autonomy. Importantly, however, Nyusi does not have the visceral intolerance of Renamo and Dhlakama that Guebuza displayed. He could be a more reasonable and skillful negotiator. Without the intransigence born of a fear of losing face, the two sides may make better progress. The pressure on Nyusi to deliver is now great. As Guebuza found out, the disappointment of your friends can be more dangerous than the wrath of your enemies. Nyusi faces the future with immense popular good will but vast expectations, too.

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