Bern — The Mozambican and Swiss governments on Wednesday, at the end of an official visit to Switzerland by President Filipe Nyusi, signed an institutional framework agreement for development cooperation.
The document was signed after official talks in Bern between delegations of the two countries, led by Nyusi and his Swiss counterpart, Alain Berset.
Nyusi told reporters that the agreement will be the basis for driving cooperation between the two countries. “In the economic area, we should stress the importance we give to the private sector, and we praise the meetings which have taken this week between Mozambican and Swiss business people”.
Both governments, he added, “have the political will to support the private sector”.
Berset said the new agreement will strengthen still further the relations of cooperation which go back more than four decades. “We spoke of the extremely good relations between our countries, and how we can strengthen our relations in economic matters”, he said.
Among the matters discussed was what has become known as Mozambique's “hidden debt”. This refers to the loans of over two billion US dollars which three security-related companies, Ematum (Mozambique Tuna Company), Proindicus and MAM (Mozambique Asset Management) took from the European banks Credit Suisse and VTB of Russia, with illegal guarantees granted by the previous government, under Nyusi's predecessor, Armando Guebuza.
The loans were contracted in 2013 and 2014, but most of the debt did not become public knowledge until April 2016. The International Monetary Fund (IMF) then suspended its programme with Mozambique, accusing the government of failing to disclose the country's true macro-economic situation.
All 14 donors who had been providing direct support to the Mozambican state budget suspended their disbursements, including Switzerland. Berset told the reporters in Bern that the Swiss government will not resume budget support until the question of the “hidden debts” is completely clarified.
“Switzerland was indeed obliged to interrupt this aid, due to the hidden debt”, said Berset. “As you know, that debt did not correspond to the fundamental pillars of cooperation. So this situation must be clarified”.
The company Kroll associates carried out an audit of Ematum, Proindicus and MAM, but found that much of the two billion dollars could not be accounted for, and that the management of the three companies refused to cooperate with the auditors.
Berset wanted the full information on the debt, and the adoption of additional measures for transparency in the management of public funds.
Nonetheless, Swiss project aid to Mozambique has continued. Berset said this aid is concentrated on the three northern provinces (Nampula, Niassa and Cabo Delgado), in the areas of health, education, water supply and infrastructures. This project aid is budgeted at seven million Swiss francs (4.4 million US dollars), for the 2017-2020 period.
Berset added that Switzerland would be willing to help the Mozambican government renegotiate its public debt with the creditors.