The CEO of Standard Bank Angola considers that insecurity in Mozambique is the biggest impediment to a greater flow of investment in the country, which is betting on the recovery of credibility to relaunch the economy.

"There is confidence in the country, in the potential that Mozambique has for the future, but there are some challenges, namely security, which is fundamental and has to be overcome to allow these large investments," said the CEO of Standard Bank Angola, Luís Teles, in an interview to Lusa, on the sidelines of the conference on investments in Angola and Mozambique, held this week in Lisbon.

"We have seen international appetite from investors to go to Mozambique and continue to invest in the country," said Luís Teles, pointing out, however, that the insecurity situation acts as an obstacle to a more robust flow of investments, particularly in the north of the country, where an armed insurgency has led Total, leader of the consortium that will explore one of the world's largest gas reserves, to suspend work on gas exploration.

International credibility

After the hidden debts scandal, known in 2016, Mozambique bet on a path to recover the international credibility that was devastated at the time, and that path is now bearing fruit, not only in new investments, but also in the return of international financial institutions that suspended budget support to the government.

"They have invested in international credibility, in governance, in transparency, the relationship with multilateral development institutions is fundamental, this is what Mozambique has been doing and has had good results," said Luís Teles, pointing out that less developed countries have more limited financing options.

"We must not forget that African countries do not have the same financing options that European Union countries have, they are other realities, and relations with multilateral development institutions are critical, because when there are crises or external shocks, they are the only option they have to support the growth of the economies," he stressed.

Mozambique has three development projects approved to exploit the Rovuma basin natural gas reserves, ranked among the largest in the world, off the coast of Cabo Delgado, but the province has been terrorized since 2017 by armed rebels, with some attacks claimed by the extremist group Islamic State.

Since July of last year, an offensive by government troops with Rwandan support, later joined by the Southern African Development Community (SADC), allowed for an increase in security, recovering several areas where rebels were present, including the town of Mocímboa da Praia, which had been occupied since August 2020.