By Paul Fauvet
Maputo (MOZTIMES) – The Abu Dhabi based group Privinvest has just lost its appeal in the High Court in London and so must pay the Mozambican state almost two billion US dollars.
This is the latest stage in the saga of what has become known as the case of the “hidden debts”. This term refers to loans of over two billion dollars which three fraudulent Mozambican state-owned companies, Proindicus, Ematum (Mozambican Tuna Company) and MAM (Mozambique Asset Management) had obtained from the banks Credit Suisse and VTB of Russia.
The only reason the banks agreed to lend such enormous sums to companies with no track record, and which were run by the Mozambican security service, SISE, was that the Finance Minister, Manuel Chang, signed sovereign guarantees for the money.
Under Chang’s guarantees, if the companies went bust, the creditors could claim their money from the Mozambican state. The loans were always illegal, since they smashed through the limits on government lending established by the 2013 and 2014 budget laws. Within a few months, all three companies were bankrupt, and so hidden loans became hidden debts.
The Mozambican government held that the true liability lay with Privinvest since it had secured the contracts with Proindicus, Ematum and MAM by paying massive bribes, including to Chang.
A London High Court judge, Robin Knowles, agreed with the Mozambican government that the bribes had been determinant.
He found that Privinvest paid bribes to secure contracts to supply fishing boats, patrol vessels, radar stations and other assets to the three fraudulent companies.
A trial in London in July 2024 looked at whether the guarantees signed by Chang were void due to the bribes and other gross irregularities.
Mozambique substantially won the case and the court ordered Privinvest to pay Mozambique almost two billion dollars. Privinvest applied for leave to appeal – and Judge Knowles turned the company down. He did not believe that an appeal would stand any chance of success.
But Privinvest did not give up. It returned to court repeatedly, without success.
It has now reached the end of the road. According to a report in the latest issue of the independent weekly “Savana”, the final appeal attempt failed, because Privinvest failed to make the deposit demanded by the court. This strengthens the suspicions of some observers that Privinvest has simply run out of money.
A source in the Attorney-General’s Office (PGR) told “Savana”, that there is now no obstacle to enforcing Knowles’ ruling of 2024, under which Privinvest must pay the Mozambican state 1.9 billion dollars.
The PGR source said the latest court ruling “revives the prospect that the Mozambican people will be adequately compensated for the hidden debts”. (PF)
