Ana Coanai, president of the Administration Council (PCA) of the State Participation Management Institute (IGEPE), said on Monday that 20 of the 107 public and state-partnered companies in Mozambique are in financial crisis. Investigation of six of these companies by A Verdade reveal current liabilities of more than 77.8 billion meticais, with 27.2 billion in short-term debt to national banks and total liabilities of 156.9 billion meticais.
Coanai did not identify the companies in financial crisis or the scale of these problems when she spoke to reporters on the sidelines of a meeting discussing new state business law in Maputo.
However, A Verdade has been investigating Mozambique’s public and state-owned companies for more than a year, and has revealed that some of the most emblematic are in a state of technical bankruptcy. These include Mozambique Airlines (LAM), Mozambican Telecommunications (TDM), Mozambique Cellular (MCel), Petróleos de Moçambique (Petromoc), Mozambique Airports and Mozambique Electricity (EDM).
From an analysis of the audited accounts up until 2016 (2015 in the case of the LAM), A Verdade found 77.8 billion meticais in current liabilities. There are 4.1 billion in LAM, 10.3 billion in MCel, 15 billion in Petromoc, 7.8 billion in TDM, 7.9 billion in Airports and 32.5 billion in EDM.
Coanai acknowledged that bank debts were one of the main challenges for these companies and said the government was negotiating debt restructuring. Of the total current liabilities,
A Verdade found 27.2 billion meticais in short-term debt to national banks and 37.7 billion in unpaid invoices with domestic and foreign suppliers. The state-owned company with a highest short-term debt to suppliers is Petróleos de Moçambique, with 9.8 billion meticais, followed by EDM with 7.3 billion and Mozambique Airports with 3.6 billion.
The highest short-term debt to the banks involves EDM with 23.9 billion meticais, followed by MCel, 5.1 billion, and Petromoc, 4 billion, while the highest debt to suppliers is EDM with 23.9 billion meticais, followed by MCel, 5.1 billion, and Petromoc, 4 billion.
The total liabilities of just six of the 107 public and state-owned companies in Mozambique amounted to 156.9 billion meticais, more than the debts illegally contracted by Proindicus, EMATUM and MAM.
The International Monetary Fund’s latest Article IV report on Mozambique last March said that “the restructuring of public enterprises in difficulty will be fundamental to improving efficiency and reduce the financial losses “of the Mozambican economy.
According to the IMF, the financial crisis in state-owned enterprises generated less taxes for the state, with deferral of payment to avoid bankruptcy, and is a risk to national banking. The debt of the top 10 state-owned companies increased 47 percent in 2016, contaminating other public and private companies and the private sector.
