The state-owned company Linhas Aéreas de Moçambique (LAM) is going through difficult times in terms of management and revenue collection, and cannot even stand on its own feet, so it needs and has been receiving money, guarantees and financial exemptions from the State.

An audit conducted by Ernst & Young revealed that the national flag carrier is making losses of six million meticais, for the 2020 fiscal year.

The audit firm advanced, in this analysis, that "future events or conditions may cause the entity (LAM) to discontinue operations."

In this sense, economist Dimas Sinóia suggests privatizing LAM to pull it out of this financial stranglehold.

"When we analyze public companies we see that, in general, there is a time [when performance] shows the fragility that we have in the management of public companies. Hence, to safeguard the profit objectives of the company itself one of the issues that can be fair is to increase privatization," said the economist quoted by voaportugues.

From the economist's perspective, LAM's financial deficit is not surprising, because most state companies have chaotic management. And, in particular, LAM already did not register good results before the pre-pandemic period.

"The Ministry of Economy and Finance reported several times that LAM was in a situation of high credit risk. Therefore, covid-19 only aggravated the situation," Sinóia recalled, warning "that Mozambique Airports are in a comparable situation.

For another economist, Tomás Selemane, there is no justification for a company of LAM's size to show negative results below zero.

"The problems that LAM has are very complex and require tailored solutions, and these do not necessarily go through the current or previous management team because it is a structural problem," he said.

A says LAM declined to comment on the matter, but assured the continuity of its flight operations, drawing on the recent renewal of its IATA certificate.