RE: Void24 Oct 2018 23:53
We can always find something to fill it with, in this case the increasing influence of China in Moz. Hungry for mineral sands and not too worried about tidying up afterwards yet they are still a significant player. Have they got the inside track on getting things done in Moz? Does Rio still have any influence? Will we ever get a licence or even a response from MozGov?
“China Powering Economic Growth in Mozambique
24 OCTOBER 2018 Leighton G. Luke, Research Manager, Indian Ocean Research Programme
Background
China’s trade with the Portuguese-speaking countries (Angola, Brazil, Cape Verde, Guinea-Bissau, Mozambique, Portugal, São Tomé and Príncipe and Timor-Leste) grew by US$82 billion in the first half of 2018, an increase of 21.5 per cent on the previous year. While the overall leaders were Brazil and Angola (together accounting for almost 94 per cent of Chinese trade with the Lusophone countries), the biggest increase in percentage terms was recorded by Mozambique: up by 45.13 per cent, or US$1.4 billion.
After having lost much of its previously-acquired gloss as an emerging economy and a promising future exporter of oil and natural gas, the Mozambican economy is now benefiting from significant Chinese investment.
Comment
After the “hidden debt” crisis of 2016, when the Mozambican Government took out secret loans totalling up to US$2 billion to fund an over-priced (and still non-functioning) tuna fishing fleet, Western investors largely abandoned the country. The main foreign investors now are China, Japan, the World Bank and the African Development Bank. Although the Mozambican Government has to wrestle with that mountain of debt, the news is not all bad. The International Monetary Fund, for instance, has estimated that the Mozambican economy will be growing at a rate of 11.1 per cent by 2023, when revenues from the large offshore gas fields in the north should come online. In the meantime, the World Bank expects economic growth of 3.5% in 2018 and 4.0% in 2019.
China, however, is not waiting. Trade with Mozambique is very much in China’s favour, with imports from China worth a reported US$1.092 billion and exports valued at just US$400 million. Future oil and gas revenues aside, the fundamental nature of the trading relationship is unlikely to change.
Beijing is now the largest source of funding for much-needed infrastructure projects in Mozambique and Chinese construction companies are the main builders of that infrastructure. Although Mozambique owes just over US$2 billion to China alone, Beijing has forgiven US$34 million of that debt and has extended the repayment period. According to a report carried by the Xinhua news agency:
‘Data from the Chinese Embassy in Mozambique shows that nearly 100 Chinese companies have accumulatively invested nearly seven billion US dollars in Mozambique as of May 2017, in areas including energy and resources development, agricultur
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