The Centre for Public Integrity (CIP), a Mozambican non-governmental organization, denounces "systemic failures" in the governance of Mozambique's extractive sector, even though it represents the greatest hope for Mozambique's economic future.

In a recent analysis of the report and opinion on the General State Account (RPCGE) for 2023, drawn up by the Administrative Court (TA), the CIP revealed that the data, when compared with reports from previous years (2021 and 2022) and with good international practice, show "a pattern of systemic failures in the sector's governance".

CIP's assessment stresses that the TA report fails to present a complete picture of investment in the country, as it merely "presents the number of mining concessions", pointing out that "a number of licenses says nothing about the value of the investment made during the period under analysis".

"The most serious flaw in the contextualization of investment is the total omission of data on the solid minerals sector. While the report exhaustively details investments in oil and gas, it doesn't give a single figure on the value of investment in coal, rubies, heavy sands, gold or graphite. The TA merely presents the number of mining concessions, but a license can represent an investment of a thousand dollars or a billion dollars," reads the document.

This deliberate omission, according to CIP, "prevents any serious comparative analysis", as "it is not possible to know whether the investment in solid minerals is 1 billion or 10 billion, making it impossible to assess the true diversification of investment in the country and the relative importance of each sector". "This is an unacceptable analytical gap on the part of the TA. It presents an incomplete and biased picture of extractive investment in Mozambique," he said.

The analysis also warns that the Mozambican economy and future state revenues are "dangerously" dependent on the success of just two gas projects in a single province. Meanwhile, this province is affected by a serious security crisis. "This level of concentration is a huge strategic risk. Further delays or the cancellation of one of the projects would have a devastating impact on the country's fiscal projections," he warns.

Another point highlighted in the report is the monitoring of revenues from the extractive sector. For the CIP, the monitoring of revenues is at the heart of the governance of the extractive sector", stressing that this is where "potential is transformed (or not) into tangible benefit for the country". However, the TA's report on the General State Account (GSA) for 2023 raises some concerns.

"In total, the three sectors (Gas, Coal and Heavy Sands) contributed 30.1 billion meticais in taxes to the state. This figure, although it seems large, represented only 9.2% of the total revenue collected by the state in 2023 (327.8 billion MT). The TA report reveals a glaring lack of consistency between the data provided by different entities of the state itself," he says.

 

(Photo DR)