The consultancy Fitch Solutions considered today that the biggest political risk in Mozambique is the “continued insurgency activity” in the north of the country, which is postponing investments by oil companies in the country’s huge gas reserves.
“At Fitch Solutions, we believe that the main political risk in Mozambique this year will come from continued insurgency activity, but we also believe that the recently approved legalization of local militias to fight insurgents could marginally increase counterinsurgency in the coming quarters, analysts write.
In an analysis note on Mozambique, sent to investors and to which Lusa had access, analysts from this consultancy owned by the same owners of the financial rating agency Fitch Ratings write that Mozambique has a score of 49.7 points out of 100, in which the the lower the risk, below the average for sub-Saharan Africa at 57.7.
Despite being the main political risk, Fitch Solutions considers that “the recent visit of the president of TotalEnergies, Patrick Pouyanné, to Cabo Delgado, together with the President of the Republic, Filipe Nyusi, will result in the restart of the project, after the suspension of the operations in 2021”.
To support this opinion, analysts point out that “the security situation has improved and the number of armed confrontations has decreased, following the involvement of troops from the Community of Southern African Countries (SDAC, in its acronym in English) and Rwanda”, a country which supports Maputo and which increased the continent from 1000 in 2021 to 2500 at the end of last year.
“Despite the improvements, attacks on civilians continue and insurgent activity still persists in Palma, which will continue to threaten the development of Mozambique’s natural gas sector,” they add.
In the risk analysis, Fitch Solutions also notes that “the high number of internally displaced people in the north of the country will continue to be a risk to social stability in the coming quarters” and recalls that the number of people in this precarious situation has risen from 622 thousand, in January 2021, to 870 thousand, in June last year.
The province of Cabo Delgado has been terrorized since 2017 by armed rebels, with some attacks claimed by the extremist group Islamic State.
The conflict has already caused more than 3,100 deaths, according to the ACLED conflict registration project, and more than 817,000 people have been displaced, according to the Mozambican authorities.
Since July 2021, an offensive by government troops with the support of Rwanda, which was later joined by the Southern African Development Community (SADC), has made it possible to increase security, recovering several areas where there was a presence of rebels, namely the village of Mocímboa da Beach, which was busy since August 2020.
