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Mozambique government confirms EMATUM JV with Erik Prince’s Chinese company

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Identity of new company was revealed to parliament on Thursday, weeks after government told the ruling party

Mozambique’s notorious state-owned tuna fishing company, EMATUM, is to be reinvented as Tunamar in a joint venture with Chinese security company Frontier Services Group (FSG), the Mozambique government has confirmed.

Addressing parliament in Maputo on Thursday, Prime Minister Carlos Agostinho do Rosário said that Tunamar has already been established, and will “ensure the total operation of the boats, this year.”

The government appears to have informed Mozambique’s ruling party, Frelimo, of the existence of Tunamar, some weeks before it told parliament on 12 April. Artigo 74, a hitherto unknown Mozambican news website, reported on 4 April that Frelimo’s Central Committee was told during its meeting from 23-25 March 2018 that Tunamar is a 50:50 venture between FSG and EMATUM, and that it was supposed to begin operations in the first quarter of 2018.

EMATUM was established in 2013 through an $850 million financing package which, it later emerged, also paid for maritime security boats as part of a larger scheme, worth $2 billion in total, including two other state-owned maritime security companies, ProIndicus and MAM.

None of the three companies has yet begun meaningful operations, and all are in default to their creditors. The Mozambican state, which insists it recognises guarantees signed by the then finance minister for all three financing packages, has also failed to make repayments. The guarantees have been found to have been illegal by a parliamentary inquiry and Mozambique’s Administrative Court, as they were not approved by parliament as required under the country’s constitution.

FSG’s chairman, the controversial US businessman Erik Prince, announced the company’s intention to partner with EMATUM at a press conference in Maputo in December last year. At that event, EMATUM chairman Antonio do Rosário – no relation of the Prime Minister –  said the aim was to have EMATUM’s 24 fishing boats, which are rusting unused in Maputo harbor, put to sea by March 2018.

Antonio do Rosario said in December that Prince would also partner with ProIndicus, whose focus is maritime security, and MAM, which was established to build and maintain EMATUM and ProIndicus’ fleets.

Prince told Bloomberg in December that “phase one” would focus on the fishing industry, while he may later get involved in protecting Mozambique’s oil and gas assets.

Prince’s background is in security, having founded the Blackwater security firm. FSG describes itself as a “provider of integrated security, insurance and logistics solutions for companies operating in frontier markets.”

FSG’s publicity materials make no mention of fishing, but say its strategy is to provide “integrated security, logistics and insurance service solutions … aligned with [China’s] Belt & Road initiative,” referring to China’s planned trade and infrastructure corridor reaching through Central Asia and the Middle East to East Africa. FSG said it has “identified security as a critical service offering for companies supporting the Belt & Road initiative.”

FSG’s largest shareholder is Citic, a Chinese state-owned investment fund.

© 2018, Zitamar Ltd. Reproduction and dissemination prohibited without written permission.

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