In the year that EITI celebrates 20 years since it was established the organization syas that some countries including mozambique achieved moderate results in EITI implementation, having contributed to enhanced transparency in both the mining and the oil and gas sectors
Outcome of the Validation of Mozambique
On 12 June 2023, Mozambique achieved moderate overall score in implementing the 2019 EITI Standard (82.5 points) the conclusion was from the EITI Board. Says the report
Mozambique has achieved a .
Mozambique hosts East Africa’s largest reserves of natural gas and holds great potential to become a major producer of minerals crucial for the energy transition. The sector is an important source of public revenues, accounting for nearly a third of the country’s total exports and 7% of its national GDP in 2020. With the rapid development of its natural gas sector industry, marked by the first shipments of liquified natural gas (LNG) exported last year, Mozambique expects future gas revenues to provide vital funds for the government. To ensure these revenues can benefit the country in the long term, the country is establishing a sovereign wealth fund.
Though ‘ the moderate overall score (82.5 points) in EITI implementation, having contributed to enhanced transparency in both the mining and the oil and gas sectors” Mozambique still need to do a lot “Yet the country’s world-class offshore gas projects have been set back by a deadly conflict in the country’s northern region. In this context, EITI implementation continues to play a crucial role in promoting transparency and facilitating dialogue on the management of natural resource projects.”
“Mozambique can play a key role in enabling the global energy transition, and its natural resources are important contributors to its domestic resource mobilisation” said Helen Clark, EITI Board Chair. “The country has continued to implement the EITI under challenging circumstances. It has achieved improved transparency on state-owned enterprises which play a critical role in the country’s extractive sector and economy. I encourage stakeholders to use the EITI to ensure accountability in how revenues are managed and as a platform for engaging communities in decision-making.”
Addressing revenue sharing challenges
Ongoing discussions focus on how extractive revenues, which are collected by the central government, can benefit resource-rich provinces and communities impacted by extractive activities. EITI reporting has helped to shed light on this issue, highlighting weaknesses in the allocation of extractive revenues to host communities, which are entitled to 2.75% of gas and mineral production tax. As a result, the rules governing the allocations are being clarified, with the government deciding that provinces will receive additional 7.25% of production taxes paid by extractive companies.
Mozambique’s EITI multi-stakeholder group has also contributed to developing legislation on gas revenues, advocating for transparency in the governance of the country’s sovereign wealth fund. Furthermore, the government is conducting revenue forecasting studies to gain a better understanding of revenue management in the coming years, providing valuable information for public debate.
Advancing beneficial ownership transparency
Mozambique has made substantial progress in contract transparency, with the country’s 2014 petroleum and mining laws mandating that all contracts signed after the approval of these laws are made publicly available. Nearly all contracts predating 2014 are also available on government websites. These disclosures have been instrumental for researchers and civil society in understanding the terms of extractive projects and estimating future revenues.
However, progress on ensuring transparency of the beneficial owners of oil, gas and mining companies has been limited thus far. To address this, the government is working with partners to establish a legal framework that facilitates the collection and disclosure of beneficial ownership information, which will help mitigate and address corruption risks.
In November 2022 governement source Isabel Chuvambe speaking to journalists at the end of a seminar to disseminate the 10th EITI report, held in the city of Xai-Xai, capital of southern Gaza provincesaid that Mozambique has taken a step forward in promoting transparency in the extractive sector, by including the entities that actually benefit from the exploitation of natural resources in the assessments of this sector
“The Extractive Industries Transparency Initiative (EITI) requires all member countries to disclose the owners of contracts and companies operating in the extractive industry, and we have made this survey,” said the EITI national coordinator in Mozambique, Isabel Chuvambe.
The inclusion of entities that take advantage of the exploitation of extractive resources in Mozambique – technically known as effective beneficiaries – will be part of the ongoing assessment by the international secretariat on extractive transparency, which is based in Oslo, Chuvambe said.
“We did a survey at the Legal Entities Registry Office and brought in the figure of the legal or effective beneficiary,” he said.
The provision of information about the recipients of profits resulting from the exploitation of natural resources aims to combat illicit practices, including corruption, he added.