World Bank director Clara de Sousa warned that Mozambique must ensure that revenues from new natural gas projects meet the aspirations of the population, or face adverse results.
“We see several examples where unfulfilled aspirations and lack of transparency lead to problems, including conflicts,” she said.
Clara de Sousa, World Bank director for Angola and Sao Tome and Principe, was a guest speaker for the opening of a Bank of Mozambique seminar in Matola, near Maputo.
The country will start exporting natural gas from the Rovuma Basin within five years, and activities could deliver US$16 billion to the state over 25 years – an “appetiser”, promoters say, of yet larger projects in the pipeline.
At the same time, Mozambique’s reputation has been tarnished by undisclosed borrowing by state-owned enterprises of more than US$1.4 billion, discovered a year ago in a country where the population’s poverty levels remain among the worst in the world.
“The challenge is to prepare ourselves,” de Sousa said, because “in terms of macroeconomic management, an influx [of revenue] like that will bring complications, and we have to be ready.”
Complications are management challenges, and the arrival of the megaprojects exploring the Rovuma Basin deposits is a “great bonanza”, she added.
“Undoubtedly, judging by the numbers I see, natural gas will completely transform this country,” de Sousa said.
“We will have annual revenues in the state coffers much higher than anything we have had to manage so far. This should leads to caution in decisions not only about how to use money in a given period, but in particular how to manage the distribution between generations,” she said.
In order for the benefits of “this and other extractive industries” to reach the whole of society, “the links between large investments and local enterprises will have to be improved, contributing especially to economic diversification and job creation.”
As well as discussing natural gas, de Sousa’s speech touched on the need for the country’s economic growth to combat poverty, something that has not happened to date, she concluded.
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