Mozambique Bar Association pledges to help repudiate ‘odious debts’


The Mozambican Bar Association will explore every legal avenue to help relieve Mozambique of the responsibility of paying what its head today called “odious debts” of “criminal origin.”

The Prosecutor-General’s (PGR) inaction in investigating the case of the $2.2 billion borrowed by ProIndicus, EMATUM, and MAM has discredited the country’s legal system, Flavio Menete, the most senior lawyer in Mozambique, told an audience in Maputo that included the Prime Minister and Prosecutor-General Beatriz Buchili.

One year ago “we said it was necessary to treat this case with the seriousness it deserves, or risk Mozambican justice being totally discredited,” Menete said. “We were right: the disrepute is today a sad reality, with obvious signs that we’ve lost control of the situation and we’re trying to save ourselves through indefensible means.”

The PGR originally opened an investigation into the deals in 2015, but only issued its first arrest warrant this week – for former finance minister Manuel Chang, who is fighting extradition from South Africa to face trial in the US. Many observers see the PGR’s move as an attempt to stymie his extradition to the US, rather than a genuine attempt to bring him to justice in Mozambique. The PGR is investigating 17 other Mozambicans in the case, according to a list leaked to state newspaper Noticias on 10 January, none of whom have been arrested.

The weakness of the PGR has not only been highlighted by the hidden debts, according to Menete. “The public prosecutor has not managed to free journalist Amade Abubacar, illegally arrested and isolated in a military establishment; but it has been redoubling its titanic efforts to avoid the extradition of Manuel Chang – which leads us to the conclusion that it does not act impartially,” Menete said. Abubacar, a community radio journalist in Cabo Delgado, has been behind bars for almost four weeks without charge.

Odious debts

In 2013 and 2014, Chang signed sovereign guarantees for the three loans worth a total of $2.2bn, in defiance of Mozambican budget law and the constitution. An audit conducted by investigation company Kroll in 2017 found at least $500 million unaccounted for, and hundreds of millions of dollars lost in apparent over-billing. An indictment issued by a court in New York at the end of 2018 has made further allegations of kickbacks to Chang and others involved in the deals.

The Bar Association would now “do everything in its power to make parliament reconsider its position regarding the legalisation of unconstitutionalities,” Menete said. It will also work to “explore the possibility of Mozambicans not being obliged to pay debts of criminal origin, commonly known as odious debts,” he added.

A recent blog by American sovereign debt legal experts Mitu Gulati and Mark Weidemaier argues that Mozambique may have a case to withdraw the guarantees on the basis that there was corruption in the deals. “Contract law in many key legal jurisdictions makes contracts infected by corruption and bribery voidable,” they write.

Menet said the Bar Association has offered its help to the PGR in the case. Mozambican law, he said, gives any citizen the right to act as an ‘assistant’ in cases involving bribery, embezzlement, or corruption.

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