Mozambique: State-owned companies must sell shares to the public

All companies under the control of Mozambican ministries or other State bodies must sell shares to the Mozambican public, according to a decision of the Council of Ministers (Cabinet), taken on 10 February, but only now made public. Speaking to reporters on Friday, the Chairperson of the Board of the Mozambican Stock Exchange (BVM), Pedro Cossa, said this decision was long overdue. He noted that, in 2011, the Mozambican parliament, the Assembly of the Republic, passed a law on public-private partnerships, large scale projects and economic concessions which was supposed to oblige these companies to go public, to offer their shares for sale to Mozambican institutions and individuals.

Within five years, these companies should have sold between five and 20 per cent of their shares to the public. This requirement covered all enterprises in the state business sector, and other companies that play a significant role in the Mozambican economy – including banks, insurance companies, telecommunications companies and cement firms. 15 years have passed since the 2011 law and it remains a dead letter.

Not a single company has used its provisions to sell shares to the public. A few large companies are quoted on the stock exchange, but not under this legislation. The most significant are Hidroelectrica de Cahora Bassa (HCB), which operates the Cahora Bassa dam on the Zambezi River, the Mozambican Hydrocarbon Company (CMH), and the main brewing concern, Cervejas de Mocambique (CDM – Beers of Mozambique).

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In 2025, these three companies distributed 1.848 billion meticais in dividends (28.8 million US dollars, at today’s exchange rate). The figure would have been much higher, if other companies had fulfilled their duties as expressed in the 2011 law. Now the government will force them to comply with the law.

The Council of Ministers has given them three years to start compliance, and they must report back to the government every three months. The Finance Ministry estimates that at least 372 companies will be obliged to offer shares for sale if the law is enforced. This means that key companies that are majority owned by foreign interests will have to accommodate Mozambican shareholders.

“Almost all the banks that operate in Mozambique have their shares quoted on the stock exchanges of their countries of origin, but not on the BVM”, said Cossa. “It’s the same with insurance, telecommunications and cement. Mozambicans consume the services of these companies, they finance their operations with their savings and taxes, but they are excluded from sharing in their profits”.

The government’s decision to insist that these companies be quoted on the BVM “is the first consistent step for Mozambicans to participate effectively in the wealth and resources of their own country”, said Cossa. It would express the desire of President Chapo “to create an environment in which young people can invest, open businesses and build their future”.

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