Capitalism widens divide between the rich and poor in Mozambique

Lined up along the streets of central Maputo, Mozambique’s capital city, are expensive European-style bars and restaurants with sophisticated names like Café Continental, Nautilus, 1908 and Mundos.

And the residential houses and flats in the capital of this southern African nation are a flabbergasting and bewildering array of 1960s modernist and Art Deco icons, mixed with new-money skyscrapers.

Further away in the new Chinese-built airport that was completed in February 2013, aftershaves sell for $230 and bottles of Dom Pérignon, a vintage champagne, cost $320.

That is literally three months’ salary for the average worker, who lives on 3,000 metacals ($100) a month.

Faustus Cavelelo is a tuk tuk driver who has worked as a private bodyguard for international investors and as a bouncer. He is now saving to support his young family.

“The big investors need bodyguards because yes, they are so rich and they will get robbed. But for the rest of us, it’s completely safe. For myself it’s hard to make money — people are jealous, and selfish, and don’t help each other.

I am determined to improve myself. I work 10-hour days, every day, and work out twice a day, just to deal with the stress, the uncertainty,” says Cavelelo.

No figures exist on the wealth disparity here. Mozambique is a jumble of statistical contradictions. It has one of the highest real GDP growth rates in the world, at 7.5 per cent.

Yet it ranks 185th out of 187 countries on the 2013 United Nations Human Development Index by the UN Development Programme.

It is one of the poorest countries in the world, with more than 55 per cent of its 23.9 million people officially living below the poverty line.

Offshore gas

In central Maputo, the latest Toyota Prados, Hiluxs and Land Rovers drive down Avenidas Julius Nyerere, Ho Chi Minh and Kim Il Sung. These former socialist leaders might be turning in their graves at the wealth disparities to be found here.

But who are these new super-rich?

A variety of answers emerge: They are government ministers; they are friends and relatives of the Front for the Liberation of Mozambique (Frelimo), the ruling party; they are people working with and for the UN; and a small handful are oil and gas investors and associated traders.

The international hotels in Maputo are booked to 95 per cent capacity in the week with businesspeople converging here from across the globe.

The majority are here for the country’s oil and natural gas — in 2011 Mozambique discovered offshore gas fields.

“It certainly is boom time for the Mozambican economy,” Markus Weimer, a senior analyst at Control Risks, an independent global risk consultancy based in London and Maputo, tells IPS.

“The country is performing strongly in a gloomy global context, and GDP growth rates are predicted to be high (above seven per cent) for the coming years. The question is whether strong GDP growth can satisfy the raised expectations of a large part of Mozambique’s young and growing population.”

Feling Capella, a journalist and poet, echoes these sentiments. “There is a growing divide here: between old and young, between rich and poor. We are the new generation, born in the war. We are educated, we want jobs, but we can’t get them. We live in areas where the roads are awful and there is no public lighting, no sewage system,” he tells IPS.

The Mozambican civil war began in 1977 and ended 15 years later in 1992. But corruption has become a major issue in the country.

Business environment

Sebastien Marlier, an analyst at the Economist Intelligence Unit who tracks developments in Mozambique, was quoted in the Economist as saying: “Corruption has become a major concern in Mozambique. A small elite associated with the ruling party and with strong business interests dominates the economy.”

The director of Mozambique Human Rights League and Mozambique’s national winner of the Secretary’s International Women of Courage Award for 2010, Dr Alice Mabota, is candid about corruption.

“People are very angry about corruption. They want the right decisions taken by the right people. Frelimo knows they have a problem. I hope the next generation is able to address these problems,” she tells IPS.

But something else that is so obviously missing in Maputo are the middle classes. Dentists and doctors here do not own the newest cars and their sunglasses are not international brands such as Gucci or Prada.

Analysts say Mozambique is a glaring illustration that the “trickle down” effect of development capitalism does not work.

Natalie Tenzer Silva runs Dana Tours, the biggest tour company in Mozambique. She thinks the big divide between the country’s rich and poor is “unhealthy”.

“We need to cater for the middle market, for mid-range tourists, and we do this by investing in hotels, airports and cheaper travel.

At the moment the big hurdle is the cost of travelling inside Mozambique. It’s so huge, but there’s so much here — extraordinary beaches, countryside, game parks and a thriving cultural scene.

“We can cater for the existing South and East African market that want to travel here, and stimulate growth in country, and create a new, mobile, middle class,” she tells IPS.

Weimer agrees. “One factor for the large wealth divide is the high level of poverty on the one hand as well as a rapidly emerging business class on the other. The speed of developments is important as it means that many opportunities bypass ‘normal’ citizens.

“Another factor is that the business environment is particularly difficult for entrepreneurs and SMEs,” he says.

Source: Africa Review - 14.06.2013