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Mozambique's Planning and Development Minister, Aiuba Cuereneia, said on Monday that the government will use domestic revenue to cover the reduction in support for the state budget from Sweden
(19/08/2008)
Maputo, 19 Aug (AIM) – Mozambique's Planning and Development Minister, Aiuba Cuereneia, said on Monday that the government will use domestic revenue to cover the reduction in support for the state budget from Sweden, one of the country's main donors.
He was referring to the decision of Sweden to reduce, by 20 million Swedish crowns (the equivalent of 3.3 million US dollars), its commitment to direct budget support in 2009.
The Swedish decision has been mentioned in some of the Mozambican press over the past few weeks as if it were hot news. Journalists reporting the matter like this simply haven't bothered to check their facts. The Swedish decision was taken months ago, and was made absolutely public on 22 May when the 19 donors and funding agencies who provide direct budget support gave the government their pledges for 2009.
The pledges showed that two donors, Sweden and Switzerland, were promising less budget support in 2009 than in 2008, citing fears of corruption and poor governance. Most donors pledged to keep budget support at the same level as in 2008, and only four (Austria, Germany, Ireland and Spain) promised an increase.
At the time the chairperson for the 19 (known as the Programme Aid Partners), Irish ambassador Frank Sheridan, stressed that, although the government's performance in 2007 was regarded as sufficiently satisfactory for the donors to continue direct budget support, this type of support was not being expanded, nor was support to projects and programmes being converted into budget support.
This was due, he stated, to "serious concern about performance in the area of governance, in particular the lack of substantive indications about progress in the fight against corruption".
Sheridan's statement made it clear that concerns over corruption are not some eccentric Swedish position, but are common to the entire group of 19. The money Mozambique is losing is not just the cuts in budget support by Sweden and Switzerland, but the refusal by other members of the Programme Aid Partners to increase their commitment.
Speaking at a Maputo press conference, Cuereneia denied that the reduction in Swedish support was a severe blow to the budget. "Mozambique has ways to cover this situation, through domestic revenue and the contribution of some other partners who are now working with us", Cuereneia told reporters on Monday.
No doubt the government could take comfort from the visit by the Danish Finance Minister, Lars Rasmussen, who declared to reporters on Friday that Denmark expected to increase its aid to Mozambique slightly over the next few years.
The statements by Rasmussen flatly contradict a BBC story on Monday that Denmark intended to reduce its support, again because of concerns over corruption. Cuereneia said he had received no information about such a report.
Likewise claims in some of the media that Norway is taking a similar stand are bereft of any evidence. Both Denmark and Norway are among the countries which in May declared their intention to keep their budget support in 2009 at the same level as in 2008.
Cuereneia noted that the decentralization of planning and finance to district level in some provinces has enjoyed Norwegian support. A new project was being designed to cover the entire country, and Norway would not be taking part in that, he explained. That had nothing to do with reducing budget support.
Cuereneia disputed the claim that there has been no progress in the fight against corruption. One of the main concerns cited by donors, including Sweden, had been the failure to bring to justice those who ruined the privatised Austral Bank, which had to be bailed out, at great expense, in 2001.
He pointed out that the Public Prosecutors' Office now appears to be making progress, with people who had held senior positions in the bank questioned by prosecutors in recent weeks. He added that the Finance Ministry had given the prosecutors information about who owed Austral money.
"The courts are working on this, and some people, not covered by court proceedings, are repaying their debts", Cuereneia said. He did not believe that the country's partners would now cite lack of progress in the fight against corruption, given that progress was becoming visible.
(AIM)
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