A faltering phoenix
Corruption, crime and unemployment still threaten a notable success story
Jul 8th 2010 Tete
Suspend your doubts about Tete
ABOUT two hours’ flight north of Maputo, the Mozambican capital, lies the town of Tete on the crocodile-infested banks of the Zambezi river. A narrow suspension bridge forms the only crossing point for the main trade route linking landlocked Zimbabwe, Malawi and Zambia. Until a few years ago, Tete was no more than a dusty down-at-heel stopping point for weary lorry drivers. But now, thanks to massive foreign investment in what may be the world’s biggest unexploited coal field, it is fast becoming a bustling boom town, already boasting three banks, three car-hire companies, half a dozen decent hotels, an international school and a new airport with twice-a-day flights to Maputo.
With emerging economies such as those of China and India crying out for more coal, the basin around Tete is expected to play a big part in developing Mozambique’s fledgling economy. After a 17-year civil war that destroyed much of the country’s infrastructure, logistics remain poor. But in February the long-defunct railway between Tete and the Mozambican port of Beira was reopened after its complete renovation; a few kilometres upstream from Tete, a new bridge is being built, which should relieve the town’s gridlocked Samora Machel bridge, named after the country’s first post-colonial president, of its heaviest traffic; and the Zambezi river provides a plentiful supply of cooling water for mining operations as well as a source of hydroelectric power.
Indeed, Mozambique already has Africa’s most
powerful hydroelectric plant, the state-owned HCB power-station on the Cahora Bassa dam at Songo, some 200km (124 miles) north-west of Tete. It can generate more than 2,000MW an hour, most of it exported straight to neighbouring South Africa, while all around Songo villages are still plunged into darkness at night, the glow of wood fires the only sign of human habitation. The Chinese, Mozambique’s second-biggest investors after South Africa, are considering building a second power-station some 70km downstream from the Cahora Bassa, and the two biggest mining houses in the region, Australia’s Riversdale and Brazil’s Vale, are planning to build their own plants near Tete.
At the end of the civil war in 1992, Mozambique was arguably the world’s poorest country. Its transport, education and health systems were in ruins. Many Mozambicans with marketable skills had fled. But now its economy is one of the fastest-growing in the world. In the past 15 years it has swelled by an average of 8% a year, dipping slightly to 6% during last year’s global meltdown, with nearly 7% expected this year, well above the 4% the World Bank forecast for southern Africa as a whole.
Mozambique’s government is democratically elected and stable, its macroeconomic policies sound, its press reasonably free. Often held up as one of the best examples of post-conflict recovery in Africa, it has become a donor darling. This year international aid will total some $1.6 billion, worth more than half the total state budget. Foreign investment is pouring in.
But the country has a long way to go. In various international rankings, it is still among the world’s worst performers: 129th (out of 133 countries) in the World Economic Forum’s global competitiveness index; 172nd (out of 182) in the UN’s human-development index; and still in the bottom dozen in terms of GDP per head a year, at less than $1,000 in purchasing-power parity, according to the IMF. Despite a much-aired fall in the poverty rate from 69% in 1997 to 54% in 2003, the absolute number living below the poverty line rose to 11.7m in a population of around 20m. The latest national household survey, due out in August, is expected to show little improvement. Inequality has been growing.
Moreover, Mozambique, hitherto praised for its free and peaceful elections, has been dropped from the list of “electoral democracies” compiled by Freedom House, an America-based watchdog, because of alleged shenanigans surrounding October’s election, when President Armando Guebuza and his Front for the Liberation of Mozambique (Frelimo) were returned with three-quarters of the vote. The ruling party’s power is pervasive. State patronage and corruption are growing. So, too, is organised crime, sometimes apparently with political backing. Last month Mohamed Bashir Suleman, a Frelimo party stalwart and one of the country’s most prominent businessmen, was placed on America’s official list of drug-traffickers.
International donors, keen to point to Mozambique as a rare African aid success, have been getting worried. Earlier this year a group of 19 Western countries threatened a “donor strike” unless Mozambique cleaned up its act. Only after its government meekly agreed to implement the 35 reforms proposed by the so-called G19 did the aid start flowing again. Far from sounding resentful, however, Mozambique’s prime minister, Aires Aly, says the threatened strike was “in some ways good for us, because it made us realise that some issues in our programme needed review.” Without the aid, he knows his country would not be such a star performer.
Middle East & Africa
Jaime P. Monfort The Multidisciplinary European http://Monfort.org