The Mozambique Democratic Movement (MDM) yesterday called for negotiations between the Government and Mozal to halt the suspension of activities at the country’s largest industry in March, warning of social and economic impacts and damage to the business environment. The MDM parliamentary group in parliament argues “that the Government should negotiate the extension of the contract to allow for a more consistent solution to be found that guarantees the stability of the thousands of Mozambicans who will be affected by this news of the closure of the company’s operations,” said Fernando Bismarque, spokesperson for the MDM, during a press conference in Maputo. According to the political party, the suspension of Mozal’s activities will have a “major impact” on service providers and on the company’s workers, who “will be left adrift”, as well as affecting investor confidence and Mozambique’s international image.
Fernando Bismarque said Mozambique “cannot afford to see Mozal close its doors” and therefore the party believes the Government should identify a “carefully considered, structured and non-emotional solution” to ensure the company continues operating. “We reinforce the need to find a period of at least one year so that, together, we can identify pathways to resolve this impasse, which in our view cannot be seen as mere blackmail; it is necessary to assess the social dimension and the dimension of Mozambique’s image in terms of the business environment,” Bismarque stressed. Mozal purchases almost half of the electricity produced in Mozambique and is estimated to account for at least 3% of the country’s Gross Domestic Product (GDP).
The Mozambican Government said on Tuesday that there is a team working to ensure that Mozal’s future does not harm any of the parties involved, following the announcement of the suspension of activities. The management of Australia’s South32 announced on Tuesday that Mozal, Mozambique’s largest industry, will suspend activities from 15 March 2026, due to the lack of a new electricity supply agreement. READ:Mozambique government says team working to “ensure that Mozal’s future is not detrimental to any of the parties” Mozambique government says team working to “ensure that Mozal’s future is not detrimental to any of the parties” According toa statement from South32, Mozal continues to engage in dialogue with the Government of Mozambique, Hidroeléctrica de Cahora Bassa (HCB) and South Africa’s Eskom to secure “sufficient and affordable electricity” until the suspension in March, when the current agreement expires.
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The cost of maintaining Mozal, including contract terminations, is expected to be around US$60 million (€51 million), while ongoing annual maintenance and preservation costs will be approximately US$5 million (€4.2 million). Mozal announced in August that it intended to cut investment and dismiss contracted contractors, maintaining operations only until March, citing a lack of conditions for continuity. A few days later, Mozambique’s Confederation of Economic Associations (CTA) revealed that Mozal had “suddenly” terminated contracts with around 20 companies, leaving at least 1,000 people unemployed.
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