Mozambique: Attacks in north ‘scaring off potential investors’ – business group

The vice-president of Mozambique’s Confederation of Economic Associations (CTA) has warned of the consequences of armed attacks in Cabo Delgado, in the north of the country, saying that it could be scaring off potential investors.

“The attacks are already having a certain impact on industry because they create a perception of insecurity and instability,” said Florival Mucave, the CTA’s vice-president in charge of mineral resources, hydrocarbons and energy, in an interview with Lusa.

According to Mucave, the perception of instability in Cabo Delgado has a serious impact on the business environment, as those who invest want security guarantees. 

“It is very important not only that there is stability, but also that one works on the perception of stability,” he stressed, warning of the impact of the reports circulating in the social networks and other channels that he said convey the idea of “total insecurity and instability” in the region.

“We need to make sure that people understand that there is stability and it will remain,” said Mucave. While acknowledging the weaknesses and limitations of small and medium-sized Mozambican companies to take advantage of natural gas exploration in the country, he sees in the projects now in prospect the announcement of a “new era”.

In the province of Cabo Delgado, construction work is underway on a future ‘gas city ‘, to be one of Africa’s largest private investments, at a projected $50 billion (€45 billion). The project, led by an oil consortium that includes Total, Exxon Mobil and ENI, is set to employ around 5,000 workers, according to the companies, especially on construction, including some Portuguese contractors. 

In an action agreed with oil companies, Mozambique’s government has stepped up its military response, with logistical support from Russia, to the attacks by unknown groups since October 2017 in parts of Cabo Delgado province. But the violence continues and has disrupted the works on the Afungi peninsula. 

At least 300 people have died in the attacks, according to official figures, and 60,000 locals have been affected, many having been forced to flee the area, according to the United Nations.