Mozambique Energy and Security

By | June 1, 2022

Economy and energy

The Mozambican miracle (GDP growth rates of over 7% have been recorded for 10 years) is largely due to the economic recovery after the end of the war and to international aid, which contributes half of the state budget and at least 30 % of capital flows for investments.

The promising prospects provided by the discovery and exploitation of gas and coal reserves have had ripple effects: the country is acquiring massive infrastructure (e.g. a railway from the northwestern city of Tete, where most of its coal reserves are located., in Macuse, on the east coast, where a port will be built). Maputo is attracting more and more foreign investments and therefore more and more foreign technicians and workers (the arrival of consumers with an above-average purchasing power favors the creation of services for an upper-middle class: supermarkets, luxury hospitals, private universities) and also ambitious building projects. These effects, driving economic growth, are beginning to prove harmful to the local population, who experience high rates of poverty and who are witnessing, less and less passively, the rise in inflation and the price of real estate.

According to indexdotcom, the mining sector experienced robust expansion thanks to the commissioning, in 2000, of the large Dutch-Mozambican aluminum foundry Mozal and the opening of the Pande-Temane gas pipeline. Recently, a more profitable exploitation of the Moatize coal basin in the province of Tete, the Moma titanium mining project and the construction of an additional pipeline for South Africa have been added. In the medium term, large investments are planned for the exploitation of gas fields located off the Rovuma basin (in the north of the country) discovered by Eni and Anadarko.

The explorations still in progress confirm the global importance of gas fields, with total reserves so far ascertained that are close to 2,000 billion cubic meters. Since 2011, Mozambique has started exporting coal.

Defense and security

Mozambique has one of the numerically smallest armies in sub-Saharan Africa (it only counts 11,200 elements) and receives a high level of international assistance also thanks to its low military spending, under 1% of GDP. Recently, however, civil society organizations have denounced the disappearance of some young people forcibly taken and forced to enlist. The government denies that it could have happened. Mozambique is also at the center of an international network of drug trafficking that transit from Asia to Europe.

An Italian peace

Italy plays a leading role in Mozambique. Strong of ties with FRELIMO exponents born before independence, it was among the main donors of Mozambique during the seventies and eighties. Furthermore, Italy, thanks to an initial intervention by the Community of Sant’Egidio and the collaboration of the Foreign Ministry and Undersecretary Mario Raffaelli, was the seat of mediation between RENAMO and FRELIMO, which led to the signing of the peace agreements. of 4 October 1992 in Rome. Italy has been very committed to the stabilization and reconstruction of post-war Mozambique, both with financial resources and the dispatch of civilian personnel, and with the deployment of a considerable military contingent. A leading role reaffirmed in the resumption of tensions between RENAMO and FRELIMO in 2013-14, that thanks to the Italian mediation managed to get Guebuza and Dhlakama to sign a political agreement, confirming the end of hostilities and the beginning of a new phase of stability and full participation of all political forces. This normalization has already found its raison d’ĂȘtre in the elections of 15 October 2014.

Mozambique, new energy power?

According to a report by PricewaterhouseCoopers, the African hydrocarbon industry could experience rapid growth in the coming years if countries like Tanzania and Mozambique manage to attract enough foreign investment to the area. A boom that could transform the countries of the Rovuma basin into authentic global powers in the sector thanks to the discovery, between 2011 and 2013, of six of the ten largest oil and gas fields in East Africa. In this situation, the Italian Eni has also managed to carve out an important role by discovering the largest deposit in its history and strengthening the special relationship that already exists between Rome and Maputo.

Mozambique Energy