Mozambican civil society organizations on Wednesday advocated the creation of a sovereign fund before the start of production of liquefied natural gas from Rovuma, to allow the revenues to be used for the country's social and economic development.

"We are of the opinion that Mozambique cannot start exploring [the natural gas from the Rovuma basin] without having a sovereign fund," said Fátima Mimbire, coordinator of the Civic Movement for the Sovereign Fund, a coalition of Mozambican civil society organizations.

According to Lusa, Mimbire was speaking on the sidelines of a debate held yesterday in Maputo, four days after the first exploration platform started extracting gas from the Rovuma reserves, whose export will start in the coming months.

Mozambique "has to run" to open an account where the gas revenues will be deposited, he said.

Without a special savings mechanism, the revenues from the production and export of the resource will go directly to the State Budget, causing the Government to be tempted to increase spending in areas with no impact on social and economic development or poverty reduction, warned Fátima Mimbire.

"We have to ensure that we have a sovereign wealth fund for the first revenues, even if they are tiny. It is possible for Mozambique to start small and create savings," he stressed.

The risk, he continued, lies in the possibility that the government will use the money from natural gas revenues to pay off the huge public debt.

Gas revenues should be channeled to social sectors such as education and health, as well as to the construction of infrastructure that allows for the transformation and diversification of the economy, namely roads and bridges, argued Fátima Mimbire.

Regarding a draft model for a sovereign fund presented in 2021 by the Bank of Mozambique, which proposes that 50% of the revenues be channeled to the State Budget, civil society organizations are not opposed to this option, but argue that a plan should be drawn up that clearly defines the priorities of the endowment.

On the occasion, speaking on behalf of the Parliament, the president of the Planning and Budget Commission (CPO), António Niquice, assured that the parliament will approve legislation on a possible sovereign fund to ensure that energy resources are not a "nightmare for Mozambique, but a blessing".

"We don't want to repeat the mistakes of other countries, because we already have those examples that went wrong," said Niquice, a deputy for the ruling party Frente de Libertação de Moçambique (Frelimo).

The Assembly of the Republic, he continued, will adopt legislation that guarantees transparent management and accountability, aiming to use the revenues for the social and economic development of the country.

António Niquice defended that the exploration of natural resources should be a factor of peace and not of conflicts, through the creation of job opportunities for the youth.

In a document it released last year about a possible sovereign fund model for the country, the Bank of Mozambique admitted that the possibility of integrating civil society in the management of the account will be "considered," noting that this option is not common in the experiences of other countries.

The Bank of Mozambique says that it is "desirable" that the sovereign fund be established before the country starts receiving revenues from the production of natural gas from the large deposits in the Rovuma basin, in time to create technical and institutional capacity for better management of natural resources, without jeopardizing macroeconomic and financial management.

The institution previously assumed a scenario in which it expects the country to receive $96 billion over the life of the Rovuma gas, almost seven times the annual Gross Domestic Product (GDP) - without specifying the time frame for obtaining that amount, but the government has pointed to at least 25 years of extraction.