Article Type : Research Article
Authors : Mabucanhane N
Keywords : Sovereign fund; Ministry of economy and finance (MEF); Economic development
The extraction of natural resources in
Mozambique marks a historical landmark never seen due to the beginning of
export of natural gas in areas 1 and 4 of the Bacia de Rovuma, which allows
generating public revenues. Given the high magnitude of these financial
resources, the government approved Law No. 1/2024, of 9 January - Sovereign
Fund of Mozambique with the aim of stabilizing the state budget and saving
resources for future generations. The article aim to analyzing the rationality
of accumulating savings for future generations in a context in which the
majority of the Mozambican population lives below the poverty line. The article
argues that the sovereign fund of stabilization of the state budget and savings
accumulation for future generations, by itself, is not enough in the medium
term to generate socioeconomic development without taking into account colossal
and strategic investments in infrastructure of security, economic and social.
This is a qualitative study based on the literature review, document analysis
and participation in relevant auscultations led by the Assembly of the
Republic.
In November 2022, Mozambique signaled an important
historical landmark in the extractive industry by starting the exploration of
one of the largest natural gas reserves in areas 1 and 4 of the Rovuma Basin.
The exploration and exportation of this resource allowed approximately 75
natural gas shipments in the Projector Coral Sul, which means 5.7 million tons
of gas, generating revenues of 114 million US dollars. This historic milestone
happens at a time when the country resents a multiplicity of crises, such as
the pandemic (COVID-19), natural disasters, terrorism in Cabo Delgado,
intensification of the wave of kidnappings and abduction, unemployment, social
inequalities and, consequently, the increase in absolute poverty, beyond the
current political context characterized by violent demonstrations. From 2011 to
2024, the Ministry of Economy and Finance (MEF) and other relevant actors in
this domain, held debates with a view to the creation of the Sovereign Fund of
Mozambique (SFM) – [1]. For the government, the SFM law aims to ensure that the
revenues of oil and gas exploration encourage the country's social and economic
development, through the maximization of gains to the national economy, as well
as ensuring that they constitute a source of stabilization of the State budget
and contribute to the generation of savings and wealth in the future.
The article aim is to analyze the rationality of
accumulating savings for future generations in a context in which the majority
of the Mozambican population lives below the poverty line. The article argues
that the sovereign fund of stabilization of the state budget and savings
accumulation for future generations, by itself, is not enough in the medium
term to generate socioeconomic development without taking into account colossal
and strategic investments in infrastructure of security, economic and social.
The evidence to support this argument is based on the conjugation between the
theory of historical neo-institutionalism and the qualitative approach. It
apply as techniques the review of literature, document analysis and quality
participation in public auscultation sessions to relevant actors of the
Ministry of Economy and Finance, from the Bank of Mozambique and civil society,
led by the Assembly of the Republic for the creation of the SFM. The article is
structured in two parts beyond the present introduction and the conclusion. The
first part, in discussing the foundations of the creation of the Sovereign Fund
of Mozambique (SFM) presents the results generated by some countries that
created this type of instrument regarded as high financial savings value. It
also shows some extractive resources that constitute the potential of the
country and how to revenue from oil and gas exploration in areas 1 and 4 of the
Rovuma Basin will be distributed between the State Budget and the SFM account.
The second part analyzes the socioeconomic context during the creation of the
SFM. It also discusses the advantages in the medium term that could be
generated from the sovereign infrastructure background SFM, without, however,
underestimating the Sovereign fund of stabilization of the state budget and
savings accumulation for future generations.
Since China created its sovereign fund in 2007 of
three US trillion dollar, there have been important economic, geopolitical and
geostrategic debates about the real meaning and social value of this instrument
with high level of internal savings. The 43 international countries that
created a consolidated sovereign fund, between 1953 and 2008, 67.4% did it from
the revenues from oil and the others did it from gas, natural resources and not
commodity [2]. In turn, the Sovereign Wealth Fund Institute (2020) [3]
indicates that the United Arab Emirates (EAU) held by 2020 the second largest
sovereign fund in the world - the Abu Dhabi Investment Authority evaluated at
USD 697 billion, being first placed by Norway - Government Pension Fund-Global
with 1,074.6 billion of USD. Analyzing the relationship between international
reserves and Gross Domestic Product (GDP), the author points out that, the
countries that had success on sovereign fund have reservations above GDP,
namely: “Libya - 101.54%; Singapore - 97.99%; Hong Kong - 74.61%; Algeria -
70.99%; Botswana - 67.51% and Malaysia - 50.69%. In 2010, for example, three
countries had reserves on a sovereign found near GDP, which are:
Timor-Leste-46.20% and Trindad Tobago with 32.81%. These results have shown
it´s possible to protect national economies against the cyclical seizures and
create conditions for the stability of the exchange rate from financial
resources spared in SF. This fact explain why Sovereign Fund reservations are
taken as a potential instrument of financial management, as it not only ensures
financial stability, but also allows the exploration of exhausted natural
resources to serve for future generations and/or colossal investments in
strategic areas. The chosen model to establish the FSM is inspired by Norway,
but also from East Timor and Trindad Tobago. As indicates Jamal Omar, financial
stability administrator of the Mozambican Bank, interviewed Chambisso [4], in
the sovereign funds of success, cited above "there is a clear separation
of functions, of responsibility and, clear supervision mechanisms, supervision
mechanisms are instituted the monitoring and, in some cases, of advisory
". With instituted mechanisms of accountability, transparency in the
management of financial resources (idem) is evident that the SFM will success.
Norges Bank of Norway, for example, which in the national case is the Bank of
Mozambique, manages the fund along with the various control and inspection
layers that are a professional and independent board.
As shows INE (2022 and 2023) and Charles (2022),
Mozambique has colossal amounts of natural resources, such as the 36% arable
land, 23 billion tons of mineral coal, water resources, titanium, tantalum,
marble, granite, limestone, precious stones, platitudinous, uranium, iron,
cobalt, chromium, nickel, copper, granite, fluoride, sodomite's, emeralds,
wood, etc. Notwithstanding the extraction of these and other mineral and
energetic resources started more than three decades, the debates in Mozambique
about SF creation began with the exploration of 2.8 trillions of natural gas
reserves. This is associated with a multiplicity of fundamentals highlighting.
I) revenues from natural resources initially extracted and especially in a
context of mismanagement, were not able to cover the needs of the State Budget
(OE). II) the power natural gas revenues that is able to put Mozambique among
the 10 largest producers worldwide and make it in the second largest gas
producer in Africa after Nigeria, and, iii) expectations generated in terms of
revenue collection for the Mozambican state. Gas exploration in the Rovuma 1
and 4 basin began in November 2022. During this period, projections on revenues
from the exploitation of this feature pointed out that when reaching peak,
Mozambique will raise $ 91.7 billion per year during the Project Life Cycle
(PLC). Therefore, Mozambique expected to raise revenues only for the state 6
billion dollars a year. Initial data presented, for example, by the statistical
report of Central Mozambique Bank (2024) and by the Journal Noticias, in the
September 11, 2024 edition, indicate that the transitional account of the
Sovereign Fund, received this year 7,285.74 million meticais, resulting from
the exploration of natural gas. The source points out that 75 gas charges have
already been made in Projecto Coral Sul the southern choir project, which means
5.7 million tons of gas. As a result of revenue collection, US $ 114 million
were raised, corresponding to 7.3 billion meticais in 2023, adding to plus the
39.8 million from the first half of 2024.
It is in this context that the Government of
Mozambique approved in 2024 the Law of the Sovereign Fund of Mozambique (Law
No. 1/2024, of January 9). The Government's aims to ensure that the revenues of
oil and gas exploration encourage the country's social and economic development
by maximizing gains for the national economy, as well as ensuring that they
constitute a source of stabilization of the state budget and allow the
generation of savings and wealth in the future. To achieve this desiderate, the
government defined the following triad: i) support for the country's economic
and social development; ii) accumulation of savings for future generations,
through the collection of revenues from oil and natural gas exploration and
those resulting from their investments, and; iii) Stabilization of the State
Budget, in cases of volatility of oil revenues. This trilogy is sustained by
the conviction of revenue generation as a result of liquefied natural gas
production in areas 1 and 4, offshore of the Rovuma Basin and future projects
for the development and production of oil and natural gas. From natural gas
production, the government predicts to obtain: i) gross tax revenue from the
exploration of oil resources, such as: oil production tax and tax on the income
of legal persons, including those resulting from the taxation of surplus value;
ii) Production bonus, and; iii) production sharing from petroleum profit.
According to paragraph 4 of article 8 of Law No.
1/2024, of 9 January, SFM Law, the financial resources to be generated by the
production of liquefied gas will be deposited in the transit account, before
their transfer by 40% to the Sovereign Fund of Mozambique (Sovereign Bank
Account - SBA). The transference will be made in the first 15 years of FSM
operationalization and 60% for the State Budget (Single Treasury State Budget
Account - STSBA). From the year 2039, transitory account transfers are going to
be 50% for SBA and 50% for STSBA. During the consultation, process of relevant
actors of the Ministry of Economics and Finance (MEF) and the Bank of
Mozambique (BM) this percentage distribution of resources was questioned. The
foundation of the proponents is that the country resents the budget deficit and
it is necessary to create conditions so that, in the first phase and gradually,
it can generate consistent resources with operational needs in terms of
expenses and stabilize the OE. Moreover, the experiences of the 43
international countries that were successful in creating this type of savings
instrument defined the percentage due to their budgetary, investment and
savings needs. Thus, the onus of debate should not be the question of the
percentage distribution of resources. However, rather the mechanisms and
process of governance of the SFM, that is, the provisions of the law must be
fulfilled and ensured transparency and distributive justice of resources. There
are also questions in relation to the reason of the application in the SFM only
revenues of natural gas excluding the other extractive resources. The argument
is that other extractive resources should continue to feed the State Budget,
which allows to dedicate, part of the gas financial resources to support SBA.
Considering that the collection of revenues from extractive resources has
started more than 3 decades ago, it would be better for them to continue to
feed the State Budget and those of the Rovuma basin could be allocated to the
sovereign background for safety, economic and social infrastructure.
Mozambique sovereign fund: the
socioeconomic context
The SFM - Law No. 1/2024, of January 9 is created in a
context where in Mozambique the poverty level increased from 45.1 % to 65 %,
and the inequality rate rose from 0.47 to 0.51, being more pronounced in rural
areas and in the northern region of the country, as indicated by the Family
Aggregate Budget Inquiry (IOF) (INE, 2023). Increased poverty and index of
social inequalities is one of the explanatory factors of the current political
moment that from October 21 characterized by popular demonstrations whose
trigger was generated by the lack of transparency and justice in the electoral
results published by the National Commission of Elections on October 24, 2024.
The clamor of the protesters is not only the electoral truth, but also the
chronicle precarious of social conditions that eventually created a huge army
of unemployed, poverty and institutional fragility. In social sectors such as
education and health, teachers, as well as doctors, nurses, service agents, and
other health professionals have often been pointing out their activities in
protest against salary and working conditions. Teachers claim salary increase
and protest against non -payment of overtime for years and precarious working
conditions. The 2024 school year is finishing, but school books have not yet
been made available, so no longer talking about the chronic problems related to
the lack of classrooms and wallets. However, it is not only teachers and
doctors the faces of the claims either by salary issues as well as by working
conditions. For the first time in the country's history, judicial magistrates
threatened last August to stop their activities throughout the country. As
Chaimite [5] points to the police and defense and security forces there are
problems of various order that end up undermining their efforts to score the
insurgency in Cabo Delgado that since August 2019 has expanded to the provinces
of Niassa and Nampula, leaving a trail of destruction, deaths and population
displacements. For this author the intensification of the wave of kidnappings
and kidnappers, which mainly afflicts the main cities of the country,
highlighting the Maputo City, which since 2011 have accounted for more than 150
cases registered, further worsens the security crisis. As a result, and, out of
fear, many entrepreneurs have already abandoned the country, leaving numerous
workers in unemployment, which further aggravated the living conditions of Mozambicans,
who already face major difficulties due to the ongoing socioeconomic crisis.
Political discourse to resolve, for example, issues related to the unemployed
army points to the famous word - entrepreneurship. It is an appeal to the
entrepreneurship of necessity and not necessarily of opportunity. Note that the
entrepreneur is the one who becomes thickening the more than 80% of the
economically active Mozambicans who operate in the informal sector? They are
therefore the so – called handyman who do, for example, small businesses on the
rides and bus stop, others are bricklayers, electricians, plumbers, gardeners,
intermediaries in the various activities of activities, the young people,
“mukhero”, street vendors, shoe entertainments, “txova”, domestic workers. Is
the question that you don't want to silence is because there is so much poverty
in Mozambique with so many natural resources?
In the political domain, Chaimite (2024:20) citing
varieties of democracy (V – idem) (2020) points to a significant regression in
the quality of democracy in the country in recent years. Mozambique “registered
a score drop from 0.49 to 0.41 between 2009 and 2019. From the same
perspective, the author cites Freedom House (2020), which classifies Mozambique
as “partially free” since 1994 and attributes a global score of 51 by 100
Possible in 2018, which fell to 45 in 2019. Specifically, political rights and
civil freedoms scored only 14.4 and 31.6, respectively. The author, when
quoting from Economist Intelligence Unit (2022) more categorically classifies
Mozambique as an authoritarian regime for the sixth consecutive year since
2018. In 2018, Economist attributed to the country a global score of 3.85 by 10
possible, with indicators of “Government operation” and “civil freedoms” to be
particularly critical, punctuating 2.14 and 2.53, respectively. The current
political tension characterized by demonstrations violently repressed by the
police may place the country in the worst indicators regarding, for example,
civil freedoms, human rights, quality of democracy and institutions, in
addition to socioeconomic conditions. The result of cyclic and non-substantive
elections is to generate post-election conflicts, characterized by armed
insurrection, civil disobedience, lack of legitimacy of the country who govern
the country. This is a scenario that each of us experiences these days, which
creates discredit in electoral processes, resulting in high levels of
abstention. Given this scenario, the question is how SFM can be a valid instrument
to reverse social precariousness, inefficiency and institutional innovation.
What is known is that “SFM childbirth was not normal, but with huge
complications that led to caesarean section, whose pregnancy lasted 13 years
(2011 to 2024)”. This long SFM gestation time can be explained by a
multiplicity of factors that include questions, incongruities, lit and
controversial debates, and sometimes consensus that have characterized the
dequitation of the SFM that is currently implementing it.
One of the factors of debate is raised by Chambisso
[6] who states that the Minister of Economics and Finance as a global manager
is politically porous and can therefore suffer political pressure of
electoralist character. The Center for Public Integrity (CIP) CIP (2022)
coroner with this analysis and, from the examination of the structure of the
six largest superficial funds in the world, states that there is no fund that
attributes this responsibility to the MEF, because this is the Funds performer
through the State Budget. This criticism is based on the porosity of the
institutions to political pressure given to the lack of separation of powers
and the state's permissibility to the party in power. Other questions presented
by the Assembly of the Republic (AR), during the auscultation to the Minister
of Economy and Finance, Max Tonela, on 27.03.2023, are associated with the
fundamentals to pay to the Bank of Mozambique (BM) a fee for managing the SFM ,
if this activity is part of its ordinary administration attributions of public
funds in general. The understanding of a part of AR members is that Central
Mozambique Bank is not conducting extraordinary activities. Therefore, should
not reduce SFM assets to remunerate bank managers, let alone fund operating
expenses. The charges arising from SFM management should be funded by the
assets allocated to the Treasury Single Account (STSBA). What are the criterion
that will be used to make public investments through revenues from natural gas?
And what are the priority areas? How to ensure application of international SFM
management best practices if the governor of the BM of Mozambique does not
accept accounting, much less has an entity that supervises their financial
operations? These and other questions are part today, of what can be called
dependence on the trajectory that characterized the complications of SFM
delivery. Notwithstanding, the access discussions raised above, Mate (2024),
for example, points out notable progress as a result of the opening of the
transient account in the Bank of Mozambique, which has already accumulated $
134.6 million. The establishment of two governance bodies, such as the
Supervision Committee and the Investment Advisory Board, provided for in
paragraphs d) and e) Article 17 of the FSM Law. These organs are mainly
functioned to monitor and guide FSM resources management. However, issues on
the absence of transparency in revenue management from natural gas exploration,
undermines public trust and the credibility of the SFM. If the law was passed in
2024, what was the destination of the funds accumulated between 2022 and 2023?
For Mate (2024:2) “if the revenues were actually raised and deposited since
2022, why did they not generate interest or other significant financial income?
On the other hand, why weren't they applied? If they have generated profits, in
the sake of transparency these details should be published along with the rest
of the information, ”as advocated by Article 29 (1) of the SFM Law, as well as
in the framework of generally accepted principles and practices (GAAP) -
Principles of Santiago, emanating from paragraph 2 of article 28 of the same
law. Why were the values not applied to financial instruments to generate
income? In this regard, the author estimates a yield of $ 6.61 million if the $
71.17 million had been applied at a rate of 3% per year. Interest application
would compensate for maintenance costs, ensuring the use of investment
opportunities. What was the cost of keeping these resources stopped in bank
accounts? What is the logic of accumulating significant amounts of resources
without any financial return in a context where the government faces serious
liquidity problems? In addition, the author raises problems related to the
capacity of the Supervision Committee and the Investment Advisory Board to
monitor and properly guide resources management, which is critical to prevent
deviations and ensuring good governance.
The world's experiences show that the lack of
transparency in the management of financial resources is the explanatory factor
of the failure of various sovereign funds. Mate (2024) takes as an example the
funds of Malaysia (1Malaysia Development Berhad) and Angola. In the first case,
there was a detour of approximately 4.5 billion of dollars to benefit
politicians and entrepreneurs. In the second case, the accounts of the
Sovereign Fund of Angola (FSA) were regularly audited. The chair of the Board
of Directors was the son of the President of the Republic who had the
responsibility of hiring the external auditor, the reports always showed a
positive performance, hiding, carrying, and a gigantic debacle in the SF of
that country. For CIP (2017) the fact that the board of directors was appointed
by the president of the then, José Eduardo dos Santos and who was also responsible
for the investment policy, definition of the internal guidelines and
appointment of the independent auditor was one of the risks to the political
porosity of the fund management system in Angola. It can still be cited as an
example of failed sovereign funds, cases of Venezuela, Brazil, Nigeria, Chad,
Equatorial Guinea, Gabon. Despite recognizing diversity of factors that explain
failure, lack of transparency and politically investments motivated appear as a
basis to take into account for the analysis the causes of their failure and
other funds at international level. It is in the contexts of these questions
and distrusts based on trajectory dependence on the fragility or porosity of
the institutions, lack of transparency, justice, nepotism and clientelism that
characterizes the modus operandi of the Mozambican entities. The argument of
this article is that the Sovereign Fund of State Budget Stabilization and
Savings Accumulation for future generations alone is not enough in the medium
term to generate socioeconomic development without taking into account
strategic and colossal investments in security, economic and social
infrastructure. What is intended to defend is also the creation of the
Infrastructure Sovereign Fund (ISF) that may, in the short and medium term,
meet current needs. For this purpose, the construction, for example, of basic
quality infrastructures such as sanitary units, schools, roads, train
infrastructure, electrification, drinking water in all the geographical space
of the country, from cities to localities, can be one of the quick and safe
ways to ensure social welfare. It is also necessary to apply the natural gas
resources to attach the Armed Forces of Defense of Mozambique (FADM) and invest
in agriculture.
To operationalize this idea requires a national
consensus on colossal and strategic areas for the development of the country.
The ISF could embrace the infrastructures and equipment of the National Defense
Forces, the economic and social infrastructure. This option is based on the
idea of its potentiality to generate a more robust production chain, since
while ensuring access to safety, food, education and quality health services
one can generate a production chain that will enable the job creation.
Mozambique can hire international reputation companies such as China Road and
Bridge Corporation-which built the Maputo-Katembe Bridge to build economic
infrastructures for a period equal to or relatively lower than the lifetime of
natural gas exploration. Other international reputation companies may be hired
to build and equip schools, hospitals, urban zones military centers to the
localities. Material and equipment to build and appeal these infrastructures
should be produced locally, no imports or at least, there must be economic export
quotas and consensually. If the country knows, for example, how much it may
require construction materials, hospital equipment, school, agricultural,
military, port, train lines, should request foreign and/or national companies
to produce such locally inputs. Thus, oil and natural gas revenues rather than
apply by 40% for future generations and 60%, for State Budget can be used to
generate a robust production chain, reduce unemployment and through
industrialization replace imports. Therefore, it is about reversing the
paradigm of generating rich from tomorrow through today's poor to for an
approach of generating tomorrow rich through today's rich. How to ensure
transparency in this process? Transparency can be ensured by observing the
three areas that configure the principles of Santiago, namely: i) legal
aspects, objectives of investment and macroeconomic policies; ii) institutional
aspects and governance; and, iii) risk and investment management structure. In
the national case, the fulfillment of the generally accepted principles and
practices (GAAP) of management, for example, through the creation of a
triangular management model. While Mozambique has the responsibility of
exporting oil and gas, importers channel financial resources directly to companies
hired to provide construction services and assignment of safety, economic and
social infrastructures. The CIP (2017) highlights as successful SF governance
structure that should be highly professional and based on corporate management
standards, transparency, sustainable investments, equidistance between politics
and fund management mechanisms.
More than dedicating 60% to Single Treasury State
Budget Account (STSBA) and 40% to Sovereign Bank Account (SBA) in the first 15
years of oil and gas export, the Sovereign Infrastructure Fund (SIF) should
also be created. No. 1 and 2 of article 12 of the SFM Law relating to domestic
investments argues that they will be carried out from STSBA, which offers no
security given to institutional fragility for this purpose. The SFM manager is
politically porous, intact when it comes to accountability and has no national
entity to which he is accountable, let alone to cyclic his accounts. SFM is
known to be powered only based on oil and gas revenues in areas 1 and 4 of the Rovuma
Basin. Thus, it can be reduced to 30% or even channel the 60% of STSBA to the
SIF, as the State Budget will continue to be funded by other sources of revenue
that also include extractive resources. The Sovereign Fund for Infrastructure
(SIF) is part of international practices. For example, Truman and Preqin cited
by the World Bank (2014) and Sovereign Wealth Fund Institute (2020) [7-9] point
out that investments in long -term economic and social infrastructure are
common in the sovereign markets market. In 2012, for example, 56% of all
sovereign funds held investments in the class of assets in infrastructure and,
of these, 36% were directed to social infrastructure such as schools and
hospitals. For CIP (2022: 2) countries such as Norway, Hong Kong and Singapore
that created stabilization, savings, technological infrastructure investments,
respectively, in the 1990s had already exceeded basic obstacles in terms of
development. Its per capita Gross Domestic Product (GDP) were “over 20,000 US
dollars in 1993: Hong Kong had PPP of $ 34.8 thousand in 1998, Norway of $
5,600,000 in 1981, far beyond the 571 dollar Mozambique figure” in 2022. Thus,
investment in infrastructure is one of the main routes for the diversification
of the economy. It can reduce dependence on oil resources, in the medium and
long term due to the high potential to attract investors in the various domains
of inputs that the country may demand to the country construction and appeal of
safety, economic and social infrastructures. During the auscultations carried
out by Assembly of the Republic (AR) at the provincial capitals, participants
stated that the creation of the best conditions for future generations is to
cover the current needs. The construction, for example, of basic quality infrastructures,
such as health units, schools and access roads, as well as invest in the
agriculture and agro-negotiation sector (Affairs Report, 2023). CIP (2022:1)
corroborates with this approach by stating that the proposal to create SFM of
the Central Mozambique Bank “does not prioritize investment, which may promote
structural changes necessary for the accelerated development of Mozambique”.
Paradoxically, the SFM proponent linearly ruled out the consensus generated by
the AR during the auscultations it performed by the provinces. The reluctance
of the proponent may result in the maintenance of the current precarious
conditions in the long-term security, economic and social security
infrastructures, given to mismanagement and lack of transparency, due to the
political permeability of the SFM governance and management bodies [10-20].
The Sovereign Fund of Mozambique currently represents
a historical opportunity to make the country in a great socioeconomic power. A
socioeconomic development guided from security, economic and social
infrastructures is not only robust but also sustainable in the medium and long
term. The creation of SF for future generations in the context of high
political porosity of governance and financial resources management can be a
misleading option in response to the high level of corruption that
characterizes the country. It is known that the Bank of Mozambique is one of
the few institutions without an entity that supervises its accounts. Although
the Supervision Committee is an independent body that integrates
representatives of civil society, business community, academy, professional
orders and religious associations, its credibility, suitability is questioned
meeting the top. Political pressure level that characterizes institutions and
organs in the country. The same can be said about the Investment Advisory
Board, the government's consultation body on the SFM investment policy, as this
body will also suffer political pressures, which may lead to politically
motivated investments. The low quality and lower coverage in territorial
infrastructure terms in Mozambique is not the problem of lack of recognized
merit professionals, or of financial experts with proven experience in the
management of investment portfolios, but of the disability of the institutions
to resist clientelist pressures that ends up flowing into the dislocation of
corruption. From the analysis done, it was possible to recognize once again
that Mozambique presents natural resources capable of making it an economic
power in which people are able to overcome socioeconomic limitations. The
creation of SF is an assertive idea, but by not contemplating, either, an SIF
with strictly defined rules capable of reducing corruption levels, makes the
fund a source of illicit enrichment of the Mozambican political elite.
Conducting colossal investments in strategic areas is much better able to
generate returns in the short and medium term than a claim to save financial
resources for future generations in a context of total non -compliance with
accountability mechanisms and observance of good practices to ensure
transparency.