Mozambique to privatise road and bridge company

MAPUTO – Mozambique plans to privatise a state-owned road and bridge company in the hope private investors will turn the loss-making company around and help rebuild the country’s war-damaged infrastructure.

Public Works and Housing Minister Felicio Zacarias told Reuters on Friday the debt-laden company is unable to meet its running costs and is struggling to pay salaries and buy equipment. “We have realised that it’s not a strategic company, therefore we are going to sell it 100 per cent because the government is not keen to have any shares”, he said in an interview.The government has asked a consulting company to value the Empresas de Construo e Manuteno de Estradas e Pontes (ECMEP) road and bridge company, which has debts of some US$5,8 million.It expects to launch a tender in late October and hopes to award it to a local company.Mozambique embarked on an ambitious privatisation programme in 1988 when it abandoned its socialist system and has since restructured or sold hundreds of state companies, including those in the banking sector and a number of manufacturers.The country’s roads are in desperate need of repair after damage and neglect during and after a 17-year civil war that ended in 1992.Mozambique’s economy is growing at about eight per cent per year as it attracts foreign investment.It hopes to attract foreign tourists visiting neighbouring South Africa for the 2010 football World Cup.To do that it must improve its roads.The government recently launched a US$1 billion international tender to rebuild a national highway linking the rural northern provinces with the more developed southern region.The World Bank in July said it would provide US$100 million in credit to help upgrade its roads.Nampa-Reuters”We have realised that it’s not a strategic company, therefore we are going to sell it 100 per cent because the government is not keen to have any shares”, he said in an interview.The government has asked a consulting company to value the Empresas de Construo e Manuteno de Estradas e Pontes (ECMEP) road and bridge company, which has debts of some US$5,8 million.It expects to launch a tender in late October and hopes to award it to a local company.Mozambique embarked on an ambitious privatisation programme in 1988 when it abandoned its socialist system and has since restructured or sold hundreds of state companies, including those in the banking sector and a number of manufacturers.The country’s roads are in desperate need of repair after damage and neglect during and after a 17-year civil war that ended in 1992.Mozambique’s economy is growing at about eight per cent per year as it attracts foreign investment.It hopes to attract foreign tourists visiting neighbouring South Africa for the 2010 football World Cup.To do that it must improve its roads.The government recently launched a US$1 billion international tender to rebuild a national highway linking the rural northern provinces with the more developed southern region.The World Bank in July said it would provide US$100 million in credit to help upgrade its roads.Nampa-Reuters