Tuesday, May 10, 2016

US reviewing aid to Mozambique because of hidden debt – Jornal de Negócios – Portugal

The United States will review the financing of 400 million dollars annually to Mozambique, after the discovery of hidden debt in Mozambique’s public accounts, advances a statement from the US embassy in Maputo sent today to Lusa.

“In light of the current situation and our responsibility to the American taxpayers who provide these funds, we will also review our assistance, in particular any assistance to the central government,” said the US embassy, ​​following the position already taken by the group of 14 donors from the state budget.

the United States are not part of the so-called G14, but are presented as “the largest bilateral donor” of Mozambique, amounting to about 400 million dollars year (EUR 350 million).

“Ecoamos Mozambicans’ concerns that demand answers,” the statement said.

the American representation recalls that its assistance to Mozambique is channeled to specific programs (in the areas of HIV / AIDS, tuberculosis, malaria, good governance, followed by agriculture, education, democracy and governance) and not to the state budget and does not intend to reduce its support.

“As the largest bilateral donor, development partner and potentially largest investor, the financial stability of Mozambique is important to the United States,” the statement said, justifying the measure following the suspension of payments to the Mozambican government has already announced by the G14, International Monetary Fund (IMF) and World Bank.

According to the embassy, ​​the United States “are in constant consultation with other donors, are aware of and endorse the recent decision by the group of 14 countries “suspension of disbursements to the Mozambican budget.

the US embassy believes that the clarifications already provided by the Government” are the first important steps to restore confidence, “but expects more.

“The Government must now act quickly to account in public full and transparent manner for these loans and how the funds were used, as well as outlining a plan to mitigate its impact on the economy Mozambique “, defends the uS embassy.

the United States, according to the statement, since 1984 spent over 6 billion (EUR 5.2 billion) in its programs development and combat the high impact diseases in Mozambique as AIDS.

“to achieve these objectives, it is necessary transparency, accountability and fiscal responsibility,” further states the US representation, noting however that despite this suspension does not intend to reduce support for the Mozambican people.

the Government of Mozambique acknowledged the end of April the existence of a debt off the public accounts of 1.4 billion dollars (1.25 billion million), explaining to security reasons of strategic infrastructure in the country.

the revelation of loans guaranteed by the Government, contracted between 2013 and 2014, led the International Monetary Fund (IMF) to suspend the second share of funding to Mozambique and a mission to Maputo.

the group of state budget donors also suspended its payments.

on Wednesday, the Mozambican President established a relationship between the case of debt hidden in public accounts and malaria and said that it is now necessary “to disinfect the house” and resume the confidence of donors.

With the revelation of new loans, public debt of Mozambique is now 11.66 billion (EUR 10.1 billion), of which 9890 million (EUR 8,6 billion) are external debt.

This represents more than 70% of Gross Domestic Product (GDP) and reflects a debt climbing since 2012, when it fixed at 42%.

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