Maputo, 17 Jun (AIM) – A prominent Mozambican NGO, the Centre for Democracy and Development (CDD), calls for suspension of the government’s decision to impose a state monopoly on the import of grain, particularly rice and wheat.
According to the government decision, grain imports, particularly rice and wheat, are now exclusive responsibility of the Mozambique Grain Institute (ICM) in order to “combat practices such as over-invoicing, illegal currency outflows and duplication of invoices in the importing of these products.”
The measure came into effect on February for rice and May for wheat.
The organization has submitted a formal complaint to the Administrative Tribunal (TA) – the body responsible for checking the legality of Mozambican public expenditure – demanding the suspension of the measure.
According to CDD chairperson, Adriano Nuvunga, speaking to reporters after submitting the complaint, centralization on imports creates a state monopoly with potential negative impacts on the economy, consumer prices, and competition among private agents.
“When there is competition between the various economic agents in imports, there are better results in prices for the consumer. Opening the market generates better results for the consumer”, he said.
Nuvunga belives that state monopoly in the cereal import sector could open the door to additional risks, including corruption and inefficiencies in the supply chain.
“By establishing a monopoly, you are immediately creating a great risk of corruption, which will clearly harm the citizen. This will result in the importation of hunger,” he declared.
The country’s Competition Regulatory Authority (ARC) had also warned that the government’s decision to impose a state monopoly on the import of grain, will eliminate competition and innovation, introducing serious systemic risks to national food security.
The ARC also warned that the government’s decision will generate “total stock shortages and an environment conducive to inefficiency and corruption” if the import of grain becomes the exclusive responsibility of the ICM.
“This constitutes a high-intensity intervention in the operations of the market. It is likely to eliminate competition in the import market, create economic dependence for downstream operators, and establish a dominant position through regulation, with potential negative effects on economic efficiency and consumer welfare”, said the Authority.
Am/
