Mozambique’s Reversal of Fortune

Just a year ago, the news from Mozambique was rather glum. The security crisis in the northern region of Cabo Delgado had displaced hundreds of thousands of people, created a humanitarian crisis, prompted regional alarm about the potential for extremists to export insecurity to Mozambique’s neighbors, and even led French oil giant Total to declare force majeure on its massive natural gas investment in the country. The long tail of the “hidden loans” corruption scandal, in which senior officials had formed state-owned companies that borrowed more than two billion dollars off-the-books in 2013 and 2014, continued to cast a pall on the economy and investor confidence. Mozambique was in peril.

The country had, and still has, massive security, humanitarian, and economic needs.  But today, Mozambique’s news is far more positive, and the country has significant international leverage.  The reordering of the global energy economy resulting from Russia’s invasion of Ukraine has made Mozambique’s liquefied natural gas (LNG) reserves more appealing than ever. Military assistance from Rwanda, as well as intervention from the Southern African Development Community (SADC), reversed the insurgents’ momentum in the north. The International Monetary Fund and World Bank have reengaged in supporting the economy. Mozambique has even been elected to a seat on the United Nations Security Council for the first time, making Maputo a can’t-miss destination for diplomats looking to build consensus and win allies in a volatile geopolitical environment.

It’s worth watching whether Mozambique—and its public and private sector suitors—make the most of the moment. Recent attacks make it clear that the security crisis in the north is improved but not resolved. Beyond the military dynamics, the political strategy for addressing the disenfranchisement, communal tensions, and criminal networks that created a fertile environment for radicalization remains hazy at best. Some governance reforms cleared the path for donors to reengage the state, but accountability is still elusive in many instances, and the connective tissue between the population and elite decision-makers is weak. National elections in 2019 were marred by violence and irregularities, and in recent polling only 27% of citizens perceive a difference between the ruling party and the state itself. The domestic trial of those charged in the hidden loans scandal has ended and a verdict is expected later in summer, but it is widely understood that some avoided charges altogether not because of their innocence, but rather because of their proximity to those closest to the current center of power in the Mozambique Liberation Front (FRELIMO) party. There is a real domestic and international opportunity to institute meaningful reforms that can put the country on a more stable trajectory. But a short-term approach that prioritizes one-off transactions and further consolidating political power could squander that chance, setting the stage for additional cycles of disruption and disorder.