BY NORM DIXON
Not content with destroying Mozambique's cashew processing industry, resulting in the loss of more than 9000 jobs in recent years, the economic dictators of the International Monetary Fund have turned their attention to the poverty-stricken southern African country's sugar industry.
The Pan African News Association (PANA) reported on May 25 that new investors in Mozambique's sugar industry have threatened to pull out if the Mozambican government succumbs to pressure from the IMF and cuts protection to locally produced sugar.
One of the factories to be affected would be Marromeu sugar mill on the south bank of the Zambezi River. Sabotaged by US-backed terrorists during Mozambique's devastating civil war, the mill has been resurrected by the Sena Company, a Mauritian-led consortium. Sena's plans to bring into production another sabotaged sugar plant, at Luabo on the north bank of the Zambezi, have been put on hold.
Sena has plans to invest more than US$100 million in Marromeu. It has spent $26 million on repairs to the factory and to rehabilitate 2000 hectares of the 13,000 hectare plantation. A South African company, Illovo, has invested heavily in the Maragra sugar plantation in Maputo province and has plans to spend $240 million.
Mozambique has a quota for sugar exports to the US at a guaranteed price of $400 per tonne. Investors were also attracted by the government's protection of the domestic sugar market. Sugar imports that are cheaper than the government-set minimum price of $385 a tonne for brown sugar and $405 a tonne for white sugar are charged a tariff to make up the difference.
Until November, the IMF did not object. However, a visiting IMF team told the government that the protection on sugar must be slashed by 2002. "If the IMF forces these impositions on the government, the result will be the closure of the factories", Sena manager, Anton de Wal, told Maputo's Metical, because Mozambique would not be able to produce sugar under the world price.
The IMF's attacks on Mozambique's reviving sugar industry seem to be a rerun of its mafia-like ultimatum on the country's cashew processing industry.
The World Bank demanded that Maputo phase out the tax on the export of unprocessed cashews. The government, the local processing capitalists and trade unions protested, but the World Bank made the elimination of the export tax a "necessary condition" for aid as part of its 1995 "country assistance strategy". The 1996 IMF-World Bank "policy framework for Mozambique" did the same.
The result was the decimation of country's efficient, relatively worker-friendly mechanised cashew-shelling factories. The processing once done by unionised women workers in Mozambique is now done by hand by child labour in India because it is "cheaper". Cashew shells contain an acid which damages workers' fingers.