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Mozambique: Confusion Over Swedish Reduction in Budget Support
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Agencia de Informacao de Mocambique (Maputo)
24 July 2008
Posted to the web 24 July 2008
Maputo
Mozambique's Minister of Planning and Development, Aiuba Cuereneia, told reporters On Wednesday that the Mozambican government has received no formal notification from Sweden that it intends to reduce Swedish support to the Mozambican budget.
He told AIM on Wednesday "We still haven't received any communication from Sweden. We haven't received information that they're going to reduce support to the budget for the reasons cited of lack of government transparency and corruption".
Cuereneia's puzzlement is understandable. He was reacting to a spate of media reports, notably on the private television station STV, which gave the impression that this is a new Swedish position taken a few days ago.
Journalists reporting the matter like this simply haven't done their homework. The Swedish decision was taken months ago, and was made absolutely public on 22 May when the 19 donors and funding agencies who provide direct budget support gave the government their pledges for 2009.
The pledges showed that two donors, Sweden and Switzerland, were promising less budget support in 2009 than in 2008, citing fears of corruption and poor governance. Most donors pledged to keep budget support at the same level as in 2008, and only four (Austria, Germany, Ireland and Spain) promised an increase.
Cuereneia certainly knows about this reduction since it was he who received the May pledges.
At the time the chairperson for the 19 (known as the Programme Aid Partners), Irish ambassador Frank Sheridan stressed that, although the government's performance in 2007 was regarded as sufficiently satisfactory for the donors to continue direct budget support, this type of support was not being expanded, nor was support to projects and programmes being converted into budget support.
This was due, he stated, to "serious concern about performance in the area of governance, in particular the lack of substantive indications about progress in the fight against corruption".
Matters are confused by the exchange rate. The usual convention is to express aid to Mozambique in US dollars. But most direct budget support is given in European currencies (such as the Euro, the British pound or the Swedish crown) all of which have appreciated very considerably against the dollar in the past 18 months or so.
In dollar terms, it looks as if Sweden has increased its budget support (from 44.6 million dollars in 2008, to 47.1 million in 2009). But this is an illusion. In reality, Sweden has reduced its support by 20 million Swedish crowns (3.3 million US dollars at today's exchange rate).
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Despite this cut, Sweden remains one of the largest contributors to the Mozambican budget. Its pledge for 2009 is 330 million Swedish crowns. Only Britain, the European commission and the World Bank give more budget support than Sweden.
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| Copyright © 2008 Agencia de Informacao de Mocambique. All rights reserved. Distributed by AllAfrica Global Media (allAfrica.com). To contact the copyright holder directly for corrections -- or for permission to republish or make other authorized use of this material, click here. | |||||||||||||||||||||||||||||
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