Africa-Press – Mozambique. The Mozambique Tuna Company (Ematum) went bankrupt largely because it was burdened with debt that had nothing to do with fishing, according to the current Ematum General Director, Herminio Tembe, speaking as a witness to the Maputo City Court on Tuesday, in the case of the country’s largest financial scandal, known as the case of the “hidden debts”
Ematum is one of the three fraudulent companies that are at the heart of the case, and 19 people are on trial, accused of crimes in connection with the companies.
The then Fisheries Minister, Agostinho Mondlane, invited Tembe to join Ematum as Executive Director of Operations in August 2015. He held several posts in the company, culminating in that of General Director.
He recalled that the company’s chairperson, Antonio Carlos do Rosario, at their first meeting, told him that setting up Ematum had not followed normal procedures, because it had a security as well as a commercial component.
“It was necessary to sacrifice some stages”, Rosario said. “We were aware that this would cause impacts. But it was necessary”.
Tembe then found out that among Ematum’s assets were three boats that had nothing to do with fishing. These were “Ocean Eagle” patrol speedboats. Much worse was that well over half of the 850 million dollars which the bank Credit Suisse had lent to Ematum, on the basis of illegal loan guarantees signed by the then Finance Minister Manuel Chang, was supposedly earmarked for the defence ministry.
This 500 million dollars is shrouded in mystery. When the company Kroll Associates carried out its forensic audit of Ematum, and of the other two companies, Proindicus and MAM (Mozambique Asset Management) in early 2017, it found that 500 million dollars – or over 58 per cent of the total loan – was nowhere to be found. The Defence Ministry categorically denied ever receiving material purchased with the Ematum loan money.
Cristina Matavele, who was Ematum Chief Executive Officer between September 2014 and January 2016, testified last week that the government tried to lighten Ematum’s debt burden, by taking over 350 million dollars, and leaving Ematum with 500 million.
But at a meeting in June 2015, the National Treasury Director, Isaltina Lucas, reversed the proportions. The government would take responsibility for 500 million dollars leaving Ematum to pay 350 million. This story was sold to the country’s parliament, the Assembly of the Republic, where 500 million dollars was written into the General State Account as defence ministry income.
It was, and remains, a fable, and not only because the Defence Ministry denied all knowledge. Had Credit Suisse known that almost 60 per cent of the money was earmarked for defence, it would never have granted the loan. Furthermore, the sole supplier for Ematum, the Abu Dhabi-based group Privinvest denies ever supplying military equipment.
Despite the many lies told by Privinvest, this claim does at least seem to be true: Privinvest does not sell weapons. So where did the money go? Credit Suisse sent the entire loan money to Privinvest to purchase assets for Ematum – so if goods worth 500 million dollars did not reach Ematum, there must be a strong suspicion that Privinvest kept the money.
The fishing boats that Privinvest sold to Ematum – 21 longliners and three trawlers – were vastly overpriced, at 22.3 million dollars each. Bringing the Ematum debt down to manageable size would involve alternative prices for the boats. Eventually a price of four million dollars per boat was proposed – bringing the debt down to 96 million dollars.
“This was not a normal procedure!”, exclaimed Tembe. “A normal procedure would be estimation of the true value of the assets by independent experts. A business plan could then be drawn up on that basis. If that was approved, it might bring the company to break-even point”.
Right from the start, Ematum had never been viable. The boats simply could not fish enough tuna to pay off the debt, said Tembe.
Furthermore, the boats arrived from the Privinvest shipyard in the French port of Cherbourg with defects which had to be corrected before the maritime regulatory body, INAMAR, would grant them fishing licences. Modifications were made to nine longliners, allowing them to fish. But the other 12 remained unmodified and were effectively useless.
Also useless were the three trawlers intended to catch bait for the tuna. But the appropriate bait cannot be found in Mozambican waters, and so the bait (squid) was imported from Argentina.
The licensed boats did go fishing between December 2014 and April 2016, but after that date all activity stopped.
Tembe said the boats caught 315.5 tonnes of tuna. This is extremely low productivity. Each boat can hold 30 tonnes of fish. So even if only nine boats were fishing, and making one trip to the high seas every two months, they should have caught well over 2,000 tonnes of tuna,
248 tonnes of the Ematum tuna was exported (to Spain, Portugal, China, Uruguay, Namibia and South Africa). This earned the country about 500,000 euros (566,000 dollars). 97 tonnes were sold on the domestic market (mainly to restaurants and caterers) for 12 million meticais (about 188,000 dollars). Two tonnes were processed by Ematum itself.
Adding to the problems. Tembe said were “constant breakdowns” of the boats on the high seas, forcing them to return to port. The on-board computers, he added, had very limited memory, and would frequently have to be reset.
As for Rosario’s claims that there was a hidden security component to Ematum, Tembe could see no sign of it (apart from the Ocean Eagles). Nor was it possible for a boat to undertake commercial and security operations at the same time – the crew would have to obey two matters, the boat’s captain and a security official, which was clearly out of the question.
Tuna fishing is obviously possible in the western Indian Ocean, said Tembe, as shown by the success of countries such as Seychelles.
“There is plenty of tuna to be fished, but it has to be done with discipline and rigour”, he said. “The problems of Ematum had nothing to do with any shortage of tuna”.
Tembe will be the last ever general director of Ematum. The company is currently being dissolved and is on the road to liquidation.
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