mozambique: IMF'S HARSH CRITIQUE of mozambique's poverty programme

MOZAMBIQUE 73:
IMF HITS POVERTY PROGRAMME
WOMEN & CASHEW
SAMORA MACHEL ASSASSINATION
ECONOMIC NEWS

Summaries of important reports
by Joseph Hanlon plus
news reports and clippings no. 73
([email protected])
8 May 2003

IMF'S HARSH CRITIQUE
OF MOZAMBIQUE'S
POVERTY PROGRAMME

Real spending on poverty reduction is falling, too little money goes to
the poor north, and officials lie in their reports, the International
Monetary Fund (IMF) says in an unusually critical report on Mozambique's
implementation of its anti-poverty programme..

In particular it notes that the government promised to increase poverty
spending as a share of GDP, yet the government's own figures show that
spending fell from 19.1% of GDP in 2001 to 18.4% of GDP in 2002. The
biggest cut was in education.

The report also criticises the government for huge spending differences
between the richer south than in the poorer north. Per capita government
expenditure in Zambezia in 2001 was only 150,000 meticais ($7) compared to
over 350,000 mt ($16) in Maputo province. Education spending ranged from
65,000 mt ($3) in Cabo Delgado and Nampula to 150,000 mt ($7) in Maputo
province.

The report is the IMF's "Republic of Mozambique: Poverty Reduction
Strategy Paper Progress Report", issue in April and posted on the IMF
website: http://www.imf.org/external/pubs/ft/scr/2003/cr0398.pdf
Mozambique's PRSP goes by its Portuguese acronym, PARPA. Although the IMF
report contains much praise and the normal diplomatic language, the
criticism is unusually trenchant and explicit.

The report underlines the fact that the PARPA is actually an agreement
between government ministers and the international financial institutions
and donors and has little national significance. The IMF notes that "there
seems to be relatively limited knowledge of the Plan [PARPA] among
technical and even senior staff with responsibilities for implementing
policies."

The IMF also notes that in an attempt to meet targets, social sectors such
as health and education "are currently prioritizing access to public
services, to the detriment of quality." In education, for example,
enrollment rates are rising, but dropout and repetition rates remain
constant. "There is a clear need for more aggressive implementation," the
report says, of "policies aimed at improving the quality and relevance of
education."

In agriculture, PARPA calls for an increase in family production as a way
to increase family income. But targets were not met, and over the past
five years production of cereals, cotton, and cashew nuts has remained
constant or fallen, the IMF notes.

In governance areas, "there remain serious lapses, insufficiencies and
deficiencies, whose resolution requires a more aggressive approach."
Prisons remain a particular problem.

Some of the strongest criticism comes of Mozambique's reporting system,
which makes it difficult to know it the country is actually meeting PARPA
goals, and effectively accuses government officials of lying. "The
information made available by the sectors on the degree of fulfillment of
targets and activities in PARPA fundamental areas do not always reflect
the real situation on the ground."

The IMF goes on to say that "in many cases this information [on compliance
with priority actions] was substandard, and in some cases totally
lacking." Where programmed actions were not carried out, the real causes
were not reported. Reports of successes omitted any qualitative
assessment; for example courses simply gave the number of people
attending, without any evidence that they had learned anything. In
agriculture, "it is hard to be specific about the degree goals have been
achieved because of the lack of details on the execution of activities".

Not all the problems are caused by the government. The IMF notes that NGOs
are stealing government agricultural extension agents faster than the
government can train them, and that the number of government agents in
2002 was less than half the number in 2000.

Buried in the report, the IMF admits that it is imposing a key constraint
on poverty reduction in Mozambique: "given prevailing revenue constraints,
channeling additional resources into the priority sectors would undermine
performance in other sectors." Unwrapping the jargon, the IMF admits that
it is capping the spending on poverty reduction.

Lack of money creates problems. For example the IMF points to the
continued poor agricultural marketing system. It notes that "nationwide
coverage of transitable highways is still fragile, however, which has
discouraged private-sector investment and slowed the development of rural
markets for agricultural inputs and products." But no extra money is
available for rural roads.

Finally, the IMF made special note of the 33 new municipalities which will
be having elections in October. The expectation that the municipalities
would generate their own resources has not been fulfilled, and central
government will have to put more money into local government budgets,
while at the same time decentralizing competences and finance to them. New
infrastructure is needed in these cities and towns for water, sanitation,
roads and environmental conservation. Instead, "as a result of their
inability to finance the necessary activities, social installation and
basic infrastructure steadily deteriorate, seriously undermining the
activities and living standards of municipal inhabitants." (Joseph Hanlon)

GLOOMY NEW STUDY
ON CASHEW IN NAMPULA

A new study of women and cashew in Nampula provinces paints a gloomy
picture. Although the government has been working with NGOs and the
private sector, efforts to promote cashew production have been top down
and farmers have not responded. A pilot project in Itoculo, Monapo
district, to spray trees with fungicide to prevent powdery mildew (know
locally as "oidio") was a failure when farmers were unable to repay even
the subsidised costs because there were so few buyers for the nuts and the
price was too low.

Attempts to set up nurseries for improved varieties of trees have also
failed. Farmers are unwilling to go to nurseries and pay 2000 meticais
each (about 9 US cents) for the trees. Furthermore, some of the new
species imported from Brazil have proved to be more susceptible to
Mozambican diseases and pests.

Even though women dominate cashew growing, "initiatives to promote
production have largely excluded women", the study finds.

On the processing side, several new semi-mechanical factories have been
set up, but there have been problems. There are complaints about higher
exposure to cashew nut shell liquid (CNSL) which burns the skin. In one
Angoche factory, 314 workers went on strike over the issue, and were
simply dismissed.

In general workers' conditions have deteriorated since the government
pulled out of running factories, the study finds. Management is more
authoritarian (one factory reports "a climate of fear"), creches have
disappeared, and health care has deteriorated. In a new small factory in
Namige, opened last year, all managerial and jobs involving machinery are
held by men. Women factory workers work long hours but are paid less than
men; indeed, the wages are so low that they have to spend a similar amount
of time in the fields.

New factories have so far created relatively few jobs, and the study finds
that the cashew processing factory closures impoverished the former
workers, especially women.

The study was carried out by Eduardo Mondlane University and the
International Institute for Environment and Development. The report is on
the IIED website: http://www.iied.org/sarl/research/projects/t3proj01.html
(Joseph Hanlon)

SOTH AFRICANS ADMIT
THEY KILLED SAMORA, BUT
SAY MOZAMBICANS HELPED

Samora Machel was killed when his plane was drawn off course by a false
navigational beacon on 19 October 1986, as Mozambicans have always
alleged, a former head of South African military intelligence, General
Tienie Groenewald, admitted in an interview in the Sowetan Sunday World on
6 April. A similar technique was apparently also used to cause a plane
crash that killed key figures in the Angolan military in 1989.

But Groenwald also claimed that senior Frelimo officials were involved in
the killing, and that senior "individuals and [current President Joaquim]
Chissano were appraised of the details of the plot to kill Machel." Under
pressure, he retracted the claim the following day, but it set off
substantial discussion in Maputo.

Not surprisingly, the allegation has brought furious denials in Mozambique
(see clippings below). Teodato Hunguana, a leading Frelimo MP, accused
Groenewald of "continuing the war of destabilisation." Chissano's
spokesman, Antonio Matonse, called the report "absolutely false" and said
that "before Samora Machel's death, Chissano had no official or informal
contacts with apartheid figures". But Groenewald only said that Chissano
knew of the plan, not the he organised it or was in contact with South
Africa.

The allegation is not so easily dismissed. Samora Machel's widow, Graca
Machel, now the wife of Nelson Mandela, has publicly accused Mozambican
"generals" of being involved in the assassination. In 1986, most members
of the Politburo had the rank of general. And the late editor Carlos
Cardoso was always convinced that Mozambicans were involved in the murder.
He argued that Machel was flying at night, against regulations, to attend
a meeting the next morning in which he was planning to dismiss senior
military officials because of corruption. Some high ranking person tipped
off the South Africans about the flight, and they set up the false beacon,
Cardoso believed. (Joseph Hanlon)

SIBA-SIBA WEBSITE

There is a website to support the assassinated Bank of Mozambique official
Antonio Siba-Siba Macuacua, which contains a petition in support of his
nomination for a Transparency International award. It is on: [
http://www.sibasiba.tropical.co.mz/ ">http://www.sibasiba.tropical.co.mz/

CARDOSO SPECIAL ISSUES OF MOZAMBIQUEFILE

Paul Fauvet of AIM, the Mozambique News Agency, has edited a two-part
special issue of MozambiqueFile on the Carlos Cardoso murder trial, which
gives extensive detail of the evidence. The cost of the two issues is
US$10 or British pounds 6. Banks charges are so high in Mozambique that
there is no point in sending cheques to AIM in Maputo. But I have arranged
with Paul that if you send a cheque to me in US$ on a US bank or pounds on
a British bank (payable to Joseph Hanlon at 100a Southampton Row, London
WC1B 4BJ, England), I will get Paul to send the magazines to you and give
him cash when I am in Maputo next. (Alternatively, you can start a
subscription to MozambiqueFile, which costs $40, pounds 26)

--------------------------------------------
OTHER NEWS (clippings below)
-------------------------------------------

GROWTH BELOW EXPECTATIONS Mozambique's Gross Domestic Product (GDP) grew
by 8% in 2002, according to the Council of Ministers. Although still high,
this is well below the provisional figure of 12% given to parliament in
December. Accumulated inflation from January to December 2002 was 9.1% and
said that the country's currency, the metical, had devalued by 2.3%
against the US dollar over the year. The current rate of exchange is about
23,800 meticais to US$ 1.

SUGAR GLUT: Mozambican sugar production has expanded rapidly because of
foreign investment. But now the Deputy Minister of Industry and Trade,
Salvador Namburete, warns that because of protection in Europe and the
United States, the countries that promote free trade for others,
Mozambique cannot now sell all the sugar it produces. Mozambique might not
be able to sell around 100,000 tonnes of sugar this year due to lack of
market.

ILLEGAL LAND OCCUPATION: A campaign to crack down on illegal land
occupation has been announced by the National Directorate of Surveying and
Land Tenure (DINAGECA) starting in Boane district, to the west of Maputo,
where several cases of the illegal sale of land have been reported. (Land
cannot be bought and sold; peasants have occupancy rights, and investors
can apply to the governmnet for 100 year leases.) DINAGECA National
Director Jose Mucombo said that some citizens occupy three or more plots
of land, but do not put them to any productive use. This would be a
violation of the lease if the land had been properly acquired, but in most
cases these plots have been acquired illicitly. Mucombo admitted that
corruption exists within his department and that illicit occupation of
land sometimes happens with the connivance of DINAGECA staff.

BANCO AUSTRAL BAD DEBTS. Since being privatised to ABSA of South Africa,
Banco Austral has recovered 300 billion meticais (about $12.5 million) in
bad bdets, and hopes to recover another 200 billion meticas this year.
This is only a small part of the estimated $150 million that was stolen
from the bank. Antonio Siba-Siba Macuacua was killed to stop him
investigating that fraud.

NEW COOPERATIVE BANK OPENS: A new bank, the Caixa Cooperativa de Credito
(Cooperative Credit Fund), has been set up by veterans of the war for
independence to provide small loans. Initial capital is $50,000. Chairman
Matias Mboa admits that many loans to veterans, notably through the
Agriculture and Rural Development Credit Fund (CCADR), People's
Development Bank (BPD), and Banco Austral were never repaid, but he hopes
that micro-finance will be more successful than large loans.

ARMY BOYCOTT: Young Mozambicans are boycotting the army. Although there is
compulsory military registration for 18-year-olds, only 5% registered this
year. The army admitted it only expected 7% to register, but the figure
did not even reach that level.

MONTEPUEZ: Two police officers were sentenced to a year's imprisonment
each for not taking appropriate measures to avoid the bloody riots of 9
November 2000 in Montepuez, Cabo Delgado. A Renamo demonstration turned
into a mini-insurrection, with the deaths of 21 civilians and seven
policemen. The court accepted the prosecution argument that the officers
had not taken the threat seriously enough. On 7 November they received
letters from Renamo advising of the impending demonstration, and
requesting police protection.

==================
CLIPPINGS
==================
SAMORA MACHEL ASSASSINATION
===================

CAPE TOWN
Machel murder: Ex-CCB killer confesses
Posted Mon, 13 Jan 2003, iafrica.com

A former Civil Cooperation Bureau (CCB) killer, currently serving a
28-year term in Baviaanspoort Prison near Pretoria, claims to have taken
part in the death of former Mozambican President Samora Machel.

The Sowetan Sunday World reported that Hans Louw, a Namibian national,
claims the 1986 plane crash killing Machel and 33 others on board, was no
accident. He was allegedly part of a clean-up team tasked with insuring
the then Mozambican president died.

However, the back-up team was not activated as the original plan - to lure
the plane off course by using a false beacon - worked. According to the
report, Louw said the false beacon was put in position by military
intelligence operatives of the apartheid government.

A commission of inquiry headed by Judge Cecil Margo, set up in 1987 by the
apartheid government, discounted the false beacon theory and found that
pilot error caused the crash.

The newspaper revealed that former Rhodesian Selous Scout operative, Edwin
Mudingi, also claims to have taken part in the hit, and confirms Louw was
part of the murder.

The Scorpions are investigating the case.

Louw says he was part of a squad that spied on Namibian activist Anton
Lubowski and knows the names of his killers.

He apparently also took part in a team that lured an Angolan military
plane off course, again using a false beacon, causing a crash that killed
key figures in the Angolan military in 1989.

. Sapa

see also
http://www.dispatch.co.za/2003/01/13/southafrica/EMACHEL.HTM

27403E APARTHEID GENERAL'S CLAIMS DISMISSED AS FALSE
~
Maputo, 7 Apr 2003 (AIM) - Mozambicans who worked closely with the
country's first president, Samora Machel, have dismissed as
entirely false the claims by an apartheid era general, published
in the South African "Sunday World" paper, that the current
president Joaquim Chissano, and other members of the Frelimo
Political Bureau, were involved in the murder of Machel.

Machel died on 19 October 1986 when the presidential
aircraft, returning from a summit in Zambia, was lured away from
its correct flight path, and crashed into a hillside at Mbuzini,
just inside South Africa.

It has always been suspected that the South African military
used electronic interference to lure the plane to its doom. The
dominant theory among Mozambican officials ever since 1986 has
been that a false navigation beacon (known as a VOR) was set up
somewhere in the Mbuzini region, broadcasting on the same
frequency as the Maputo VOR.

The sensational claim in the "Sunday World" came from a
tainted source - General Tienie Groenewald, who was once head of
South African military intelligence.

.

Since he was in charge of security, part of [Sergio] Vieira's job
involved meeting South African intelligence officials, including
Groenewald. He told AIM that the last time he saw Groenewald was
in Pretoria in 1994, shortly before South Africa's first
democratic elections.

In theory Groenewald was retired, but he rang Vieira up and
invited him to lunch. Vieira accepted and found himself in a
restaurant on the outskirts of Pretoria where the only people in
sight were obviously security figures, including a couple of
generals and a far right member of the white parliament.

After lunch, over coffee, the purpose of the meeting became
clear when one of those present asked Vieira "in the event that
we establish a Boer Republic, would Maputo be our lifeline, as it
was in Kruger's time ?"

Vieira suggested that they should ask the question to the
United Nations Security Council.

Groenewald's far right, separatist politics saw him elected
in 1994 as an MP for the Freedom Front, the extreme right party
set up by the former chief of staff of the South African Defence
Force (SADF), Constand Viljoen.

.

A commission of inquiry was set up, chaired by Armando
Guebuza, then Transport Minister, and now Frelimo general
secretary. The commission was never formally wound up, said
Vieira, but it was never able to complete its work because of
obstruction by the apartheid regime.

Over the objections of Mozambique and the Soviet Union
(involved as the country of manufacture of the plane), South
Africa pressed ahead with its own carefully orchestrated inquiry
chaired by judge Cecil Margo. Predictably, that inquiry blamed
the crash on pilot error, and after it was concluded, the South
Africans refused to cooperate any further with Guebuza's
commission.

.
(AIM)
pf/ (1150)

33403E APARTHEID GENERAL'S CLAIMS "ABSOLUTELY FALSE"
~
Maputo, 9 Apr 2003 (AIM) - Claims made in the South African "Sunday
World" newspaper by former apartheid military intelligence chief
Tienie Groenewald that Mozambican President Joaquim Chissano was
involved in the murder of his predecessor, Samora Machel, are
"absolutely false", Chissano's spokesman, Antonio Matonse, told
AIM on Wednesday.

"There is nothing true in that article", Matonse declared.

Groenewald had claimed that Chissano was "part of a network
of people who collaborated with elements of the apartheid
government and the Civil Cooperation Bureau (CCB - a notorious
apartheid death squad) to bring down the plane".

"These individuals and Chissano were appraised of the plot
to kill Machel by the apartheid government and the securocrats",
said Groenewald. "I know because I was once a director of
military intelligence, before I left and joined the Bureau of
Information in 1986".

However, within 24 hours someone else in South Africa had
leaned on Groenewald, and he issued a retraction, saying that he
"did not have any information" on the plane crash in which Machel
died on 19 October 1986.

Matonse pointed out that, far from plotting with members of
the apartheid government, Chissano, who at the time was foreign
minister, a post he had held ever since independence in 1975, had
no contact at all with South African officials.

"While Samora Machel was president, the position of Frelimo
and the Mozambican government was not to allow the Foreign
Minister to contact the apartheid authorities", Matonse said.

Official contacts with South Africa were a security matter:
so both before and after the Nkomati non-aggression accord of
1984, the people dealing with Pretoria were the security
ministers, first Jacinto Veloso and later Sergio Vieira.

Chissano did not even meet with his counterpart, South
African Foreign Minister Pik Botha. The only occasion when the
two men talked was when Botha visited Maputo to speak to Samora
Machel, and the President called Chissano into the room.

"Before Samora Machel's death, Chissano had no official or
informal contacts with apartheid figures", said Matonse. "This
was because of the Mozambican refusal to open any diplomatic
relations with the apartheid regime. To have done otherwise would
have amounted to a tacit recognition of the apartheid state".

Chissano's contacts with apartheid officials date from his
days as president, and particularly after the palace coup in
which F.W. de Klerk replaced P.W. Botha as South African
president. By then it was clear that, although Nelson Mandela was
still in prison, the regime was obliged to negotiate seriously
with the ANC.

. (AIM)
pf/ (732)

90403E DESTABILISATION BY OTHER MEANS - HUNGUANA~
~
Maputo, 23 Apr 2003 (AIM) - Members of the South African far right,
linked to the defunct apartheid regime, "are continuing the war
of destabilisation, but now adjusted to the new conditions of
peace and democracy", warned Teodato Hunguana, a leading
parliamentarian for the majority Frelimo Party, on Wednesday.

Speaking in the "period before the order of the day", a
period of up to an hour in which deputies may make political
statements unrelated to matters on the parliamentary agenda,
Hunguana concentrated on the claims made, but later denied, by
Gen Tienie Groenewald, former head of apartheid military
intelligence, that Mozambican President Joaquim Chissano knew of
the plot to assassinate his predecessor, Samora Machel.

Machel died in a plane crash at Mbuzini, just inside South
Africa, on 19 October 1986. Groenewald admitted what many
Mozambicans have long believed - that the apartheid regime was
responsible for the crash - but muddied the waters by dragging in
the name of Chissano and unspecified "henchmen".

Groenewald's claims were widely reported in the Mozambican
press: his retraction, made the following day, was not so widely
reported. Deputies from the former rebel movement Renamo (backed
militarily by the apartheid regime throughout the 1980s) were
delighted at the sensationalist headline in the South African
"Sunday World", alleging Chissano's involvement in the plot, and
earlier this month waved copies of the paper in the parliamentary
chamber.

. (AIM)
pf/ (1177)

====================
ECONOMIC ARTICLES
====================

37403E ECONOMIC GROWTH LOWER THAN EXPECTED
~
Maputo, 9 Apr 2003 (AIM) - Mozambique's Gross Domestic Product (GDP)
grew much less than expected in 2002.

A Wednesday note from the Council of Ministers, giving a
very brief summary of the final figures for last year, put the
growth rate at eight percent.

But in December, when presenting provisional figures to the
country's parliament, the Assembly of the Republic, Prime
Minister Pascoal Mocumbi had announced that a final growth rate
for the year of 12 per cent was expected.

The same government note put the accumulated inflation from
January to December at 9.1 per cent, and said that the country's
currency, the metical, had devalued by 2.3 per cent against the
US dollar over the year.

It put export earnings for 2002 at 680 million US dollars.

The government said that the drought hitting southern and
central Mozambique affected a total of 48 districts in 2002,
causing the loss of 84,000 hectares of crops, and plunging over
half a million people into a situation of food insecurity.
(AIM)
pf/ (163)

MOZAMBIQUE'S SUGAR DESPERATE FOR MARKET

Mozambique Business - Daily Investor Intelligence
MB197- 28 April 2003
Mozambique might not be able to sell around 100,000 tonnes of sugar this
year due to lack of market.
Deputy minister of industry and trade Salvador Namburete says the country
has a very limited market, the European Union, United States and SACU.
These are preferential markets.
Namburete says if no additional markets are found the country will be
forced to put its sugar on the international market where prices are so
low that they fall far short of compensating production costs.
Mozambique, with four mills producing in full swing, expects to produce
about 300,000 tonnes this year, of which about 150,000 are for domestic
consumption.
Mozambique is bidding to regain its position as Africa's forth-largest
sugar producer after Egypt, South Africa and Mauritius.

88403E PLANS TO CRACK DOWN ON ILLEGAL LAND OCCUPATION

Maputo, 22 Apr 2003 (AIM) - The National Directorate of Surveying
and Land Tenure (DINAGECA), in the Mozambican Agriculture
Ministry, has announced a campaign to monitor compliance with the
country's land tenure legislation.

DINAGECA National Director Jose Mucombo told AIM on Tuesday
that his department intends to discipline the occupation of land,
and stamp out abuses.

He said the campaign is starting in Boane district, to the
west of Maputo, where several cases of the illegal sale of land
have been reported. (Under the Mozambican constitution, all
property in land vests in the state. So land cannot be bought and
sold: tenure is through a system of land titles, and when
applying for a land title, an individual or company, must specify
what the land is to be used for.)

Mucombo said DINAGECA inspectors are already at work in
Boane, in the area of Belo Horizonte, Massaca, Campoane and
Mahubo, where the situation is said to be at its most critical.

He confirmed that there are also serious problems of illegal
land occupation in Marracuene district, north of the capital.
These were denounced in March by the independent newsheet
"Mediafax", and the Attorney-General's Office is now looking into
the matter.

What has been happening,~ said Mucombo, is that some
citizens occupy two, three or more plots of land, but do not put
them to any productive use. In most cases, these plots have been
acquired illicitly. There are also cases of two or more people
claiming the same piece of land.

Mucombo admitted that corruption exists within his
department. He recognised that illicit occupation of land
sometimes happens with the connivance of DINAGECA technical
staff.

"There are suspicions that our staff, as well as local
political and administrative bodies, are involved in the illegal
sale of land", he said. "Our inspection teams are working to
obtain more data.

He promised that the offenders will face disciplinary, and
possibly criminal proceedings, depending on what was unearthed.
Mucombo declined to give any further details on the involvement
of DINAGECA staff until the inspection teams reported back.

"Those who sell land are violating the Constitution of the
Republic", he stressed. "This can be punished under the law".

Mucombo urged those who hold land in areas of land disputes,
particularly Belo Horizonte, to approach the Maputo Provincial
Surveying and Land Tenure Services, with the relevant documents,
so as to confirm the legality - or otherwise - of their tenure.

He also called on local communities to denounce to the
authorities, or to the DINAGECA inspection teams, any cases of
illicit land occupation that they are aware of.

Mozambique has about 36 million hectares of arable land, but
only slightly more than three million hectares are considered as
occupied. But Mucombo pointed out that much of this three million
hectares is not being used properly.

He lamented that people who apply for land, are often
reluctant to make any investment. Furthermore, they are usually
interested only in land that is fairly close to the main urban
centres, where basic infrastructures such as roads, water supply
and electricity exist. It is in these areas that most land
disputes occur.
(AIM)
dt/pf (532)

BANCO AUSTRAL RECOVERS 300 BILLION METICAIS

Mozambique Business - Daily Investor Intelligence
MB202- 7 May 003

Banco Austral, one of Mozambique's leading commercial banks, last year
recovered about 300 billion meticais of bad loans, according to Johane
Stander, chairman of the banks' management board.
"We budget to recover another 200 billion meticais this year" Stander
said.
Stander said the bank's new management team hopes to avoid similar
situations in future.
Banco Austral was nearly liquidated a few years ago after a Malaysian-led
group ran the bank down and abandoned it, leaving behind a trail of
problems, including millions of dollars in bad loans.

100403E NEW COOPERATIVE BANK WILL TAKE OLD DEBTS INTO ACCOUNT
~
Maputo, 25 Apr (AIM) - The Cooperative Credit Fund (CCA), a
newly-formed banking institution, aimed at providing loans to
veterans of Mozambique's independence war, plans to take into
account in its schemes debts that veterans may owe to other
banks.

Interviewed in Friday's issue of the daily paper "Noticias",
the chairman of the CCA board of directors, Matias Mboa, said he
had asked the Austral Bank for a full list of debtors.

When it was under state ownership, Austral was called the
People's Development Bank (BPD), and administered many loans to
veterans, notably through the Agriculture and Rural Development
Credit Fund (CCADR). It is thought that the bulk of these loans
were never repaid.

"We shall analyse this point by point, to see why they
didn't manage to pay", said Mboa.

He insisted that the CCA would take this seriously, "since
we have to ensure the security of the cooperative. This does not
mean that those who failed to honour their undertakings in the
past will be excluded. We shall analyse the reasons why each one
did not honour the elementary conditions for a loan".

Mboa said that CCA was interested in micro-finances - that
is, in small loans. The experience of the recent collapse of an
earlier cooperative bank, Credicoop, showed the dangers of large
loans, "when we know that Mozambicans are often unable to honour
the repayment schedule for large loans. But we are convinced that
if we make small loans, that are within the repayment capacities
of each Mozambican, we can be successful".

Mboa criticised the existing commercial banks for their high
interest rates, and for the "humiliating" guarantees they often
demanded from their clients.

But he could not say how much interest CCA would charge on
its loans. When CCA was formally inaugurated, Mboa, somewhat
rashly, spoke of "symbolic" interest rates. Now he seemed to
retreat from this, saying that CCA staff were working on the
subject: nonetheless, he was confident that CCA would charge
lower interest rates than other banks.

Mboa said that the cooperative has between 2,000 and 3,000
members, but hoped that this number would soon triple.

The initial capital of the bank is 1.2 billion meticais
(about 50,000 US dollars). Mboa admitted that this is a very
small sum with which to open a bank, but he was confident that
the efforts of the veterans would increase this sum.
(AIM)
pf/ (405)

52403E NEW COOPERATIVE BANK OPENS
~
Maputo, 12 Apr 2003 (AIM) - Mozambican President Joaquim Chissano on
Friday inaugurated a new cooperative bank, the Caixa Cooperativa
de Credito, set up by veterans of the war for independence from
Portuguese colonial rule.

The director of the cooperative, Matias Mboa, cited in
Saturday's issue of the daily paper "Noticias", said it was set
up in order to respond to the difficulties faced by veterans, and
by the public at large, in obtaining access to credit.

The cooperative, which currently has between 2,000 and 3,000
members, promises to make small loans available at "symbolic"
interest rates.

Chissano, however, warned that money will be lent "not in
accordance with the needs of each person", but in accordance with
the capacity of the institutions.

"We cannot demand that the cooperative be all embracing
right at the start", he said. "Firstly, staff must be trained".

But he hoped that the new bank will "be another page in the
history of those who did everything they could to free the
country". He added that he expected the partnerships chosen by
the managers of the cooperative "to produce the desired results
so that this institution becomes something that is not just for
the veterans, but is national and popular".

Currently the bank only exists in Maputo, but later this
year a branch will be set up in the adjoining city of Matola.
Branches will be opened in the northern provinces of Cabo Delgado
and Nampula in 2004.

The Mozambican experience of cooperative banking is not a
happy one. The first cooperative bank, Credicoop, went bankrupt
in December.
(AIM)
pf/ (277)

===================
OTHER NEWS
===================

13303E MOST YOUNG MOZAMBICANS REFUSE TO REGISTER FOR ARMY
~
Maputo, 3 Apr 2003 (AIM) - Once again, the vast majority of young
Mozambicans have refused to register for compulsory military
service.

All Mozambicans are supposed to register for military
service in the year of their 18th birthday. The normal
registration period is January to February, but in practice it
is always extended to the end of March.

On Thursday the Defence Ministry announced that only 21,000
people had registered this year. The target had been modest
enough, at 30,000.

Fidelino Anselmo, of the Ministry's recruitment and
mobilisation department, . effectively admitted that the Ministry has no
idea
how many 18 year olds there are in the country. He complained
that unspecified institutions are not cooperating in providing
statistics on how many people turn 18 each year.

. The Ministry does not know, but AIM does. For AIM has a copy
of the results of the 1997 population census. This is a public
document, issued by a state body, the National Statistics
Institute (INE), available in printed form and on the Internet.
Yet the Defence Ministry has apparently never heard of it.

To work out how many people celebrate their 18th birthday
in 2003 is simple - just look at how many 12 year olds were
counted in 1997, and make the necessary adjustments.

There were 410,371 12 year old children physically counted
by the 1997 census brigades. A subsequent coverage survey
estimated that the census had reached 94.9 per cent of the
population. Adjusting for this, the true number of 12 year olds
was 432,425.

There is not much mortality in this age group. A look at the
mortality figures from the census allows us to estimate that
eight to nine thousand people who were 12 in 1997 have died in
the ensuring six years. That gives a total population of 424,000
or so Mozambicans who turn 18 this year.

Under the current law all of these 424,000 people should
have registered for military service between January and March.
But the Defence Ministry's target of 30,000 shows that the
government only expected seven per cent of them to do so. The
actual registration figure of 21,000 is just five per cent.

In other words 95 per cent of 18 year olds failed to
register. This is a mass, albeit unorganised, boycott: the only
realistic conclusion is that the vast majority of young
Mozambicans have no intention of setting foot in the armed
forces.

. (AIM)
ju/pf (591)

51403E MONTEPUEZ POLICEMEN JAILED FOR NEGLIGENCE

Maputo, 12 Apr 2003 (AIM) - The provincial military court in the
northern Mozambican province of Cabo Delgado on Friday sentenced
two police officers to a year's imprisonment each for culpable
negligence during the rioting of 9 November 2000 in the town of
Montepuez.

The two men, Florencio Raisse, chief of operations at the
Montepuez district police command, and Angelo Romero, the then
director of internal order in the provincial command, were
accused of not taking appropriate measures to avoid the bloody
scenes that erupted on that date.

A demonstration organised by the former rebel movement
Renamo turned into a mini-insurrection, with the deaths of 21
civilians and seven policemen. Renamo took control of the town
for about 48 hours, and looted the police armoury and several
government buildings.

The court accepted the prosecution argument that Raisse had
not taken the threat seriously enough. On 7 November he had
received letters from Renamo advising him of the impending
demonstration, and requesting police protection. He knew that the
district command did not have enough men or equipment to deal
with the demonstration, should it turn violent.

Indeed, when the Renamo demonstration turned out to include
armed men, the small police force was overwhelmed, losing seven
of its men. The rest were forced to retreat, leaving the town in
Renamo's hands.

Romero is accused of not acting on the information that the
provincial command had received from Montepuez of the impending
demonstration and of not sending reinforcements, other than
himself, to the town.

During the trial both men vigorously denied the charges of
negligence. Raisse said the police were forced to retreat because
they ran out of ammunition. He said that on 8 November, the day
before the demonstration, he had gone personally to the
provincial capital Pemba to seek reinforcements in men and
ammunition.

Raisse claims it was the provincial command that claimed
they had no reinforcements and no more ammunition to send to
Montepuez. The only person the command gave him was Romero.

Raisse denied receiving any orders to raise the combat
readiness of his men to maximum alert. Nobody had sent him any
orders at all, he insisted, and any preparations the police took
were entirely his own initiative.

Romero backed this story up and told the court the real
reason Renamo had been able to take control of Montepuez was
because the provincial police command did not heed the requests
of the Montepuez police leadership for reinforcements.

One problem with this defence was that, when Renamo handed
over (to the local military garrison) the guns it had taken from
the police armoury, they included 384 bullets, indicating that
the district command had not run out of ammunition.

Raisse, however, insisted that his men did not have a single
bullet left when they retreated, and that, if the rioters handed
over bullets, they had not picked them up at the armoury.

The two policemen have already spent the greater part of a
year behind bars. The court decreed they would serve the rest of
their sentences "in their units".
(AIM)
pf/ (508)

ENDS