In China, a few corrupt officials are made examples and executed. In Mozambique, some donors want at least metaphoric heads to role. But Frelimo’s history suggests otherwise.
Perhaps the best model of what will happen is an old story. As a condition of IMF support, the then People’s Development Bank (BPD) was privatised in 1997 to the Southern Bank Berhad (SBB) of Malaysia (30%) and Invester (30%), a Mozambican company headed by Octavio Muthemba, former Industry Minister and chair of SPI – Gestão e Investimentos, the Frelimo party holding company. The state kept 40% of the renamed Banco Austral. Through a mix of direct theft and bad loans to themselves and others in the Frelimo elite, the bank was drained of at least $150 million and then handed back to the state in 2001. Antonio Siba-Siba Macuacua, the Bank of Mozambique’s head of banking supervision,…
