5 January 2009
Maputo — The government of the central Mozambican province of Sofala has admitted that so far the repayment of loans under the Local Initiative Investment Budget (OIIL) has been "insignificant", reports Monday's issue of the Maputo daily "Noticias".
This initiative refers to the sum, initially of seven million meticais (about 280,000 US dollars) a year, allocated from the central budget to each of the 128 districts for projects to increase food production and create jobs. The money is handed over, not as a grant, but as a soft loan which the beneficiaries are supposed to repay.
The Sofala Provincial Permanent Secretary, Antonio Maquina, told "Noticias" that this fund is beginning to produce the desired effects. He claimed that since the OIIL was introduced in 2006, the projects it has financed have created more than 7,000 jobs.
He did not say how much of the money has been repaid, but conceded that in all 12 Sofala districts repayment has been minimal. Nonetheless, he was optimistic that the beneficiaries are becoming aware that this is not a state handout, and they must return the money.
Nobody has yet been punished for failure to repay, because the repayment period has not yet expired said Maquina. But he insisted that penalty clauses are envisaged in the contracts that each of the beneficiaries signed with the state.
"There was an agreement between the parties and any beneficiary who does not honour the undertaking he has given will obviously be penalized", he said. "This money has to be recycled to benefit other people, and so it has to be repaid".
"This is a process", said Maquina, "and any process takes time. Certainly there are failings that may have been committed, but the most important thing is that these must be corrected, since the main objective is development. It's noteworthy that beneficiaries have become aware that they must return the money their received in good time".
He added that the involvement of community bodies was important in making beneficiaries aware that they must repay. To ensure that everything runs smoothly, the provincial government has trained the District Consultative Councils, the bodies which approve the projects that use the OIIL, in how to manage the fund, and ensure that the money is used correctly.
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