The final proposal of Mozambique’s Local Content Law, which aims to regulate the participation of Mozambican companies in large extractive industry projects, has been approved after five years of discussion between the government and the private sector, according to the daily newspaper O País.
The document, which has no set date for consideration and final approval in parliament, contains 16 pages and 28 articles and has not achieved a consensus within the private sector, according to the newspaper.
Florival Mucave, chairman of the Local Content Commission and business liaison of the Confederation of Economic Associations, Mozambique’s employer association, said “we are disappointed by the clauses in the proposal” adding that “the sale of a 15% stake through the stock exchange is risky.”
Article 21 specifically states that “large projects must set aside 15% of their capital for sale by Mozambican public or private natural and legal persons through the stock exchange.”
It also states that “each sector of activity of which the enterprise is a part may define a different percentage of national participation, provided that it does not exceed the percentage referred to in the previous paragraph (15%).”
Florival Mucave stressed that the future Local Content Law does not apply to the Rovuma Basin Block 1 liquefied natural gas project, whose Final Investment Decision was made last June.
Vasco Nhabinde, national director of the Department of Economic Studies at the Ministry of Economy and Finance, when faced with the disappointment of employers, said the proposal was the best one possible. (Macauhub)