Donors dissatisfied with reporting procedures

International donors say they are dissatisfied with the Mozambican government’s reporting procedures on the handling of foreign aid.

A spokeswoman for the Norwegian Aid Programme (NORAD) in Maputo told IRIN on Wednesday that NORAD’s concerns were specifically related to the money given for budget support. She said NORAD had asked the Mozambican government to give reports on all cash flows in relation to the budget support programme and had requested all bank statements as well as details of all bank accounts that were used.

Last week, following a meeting in Maputo between donors and the government, NORAD’s general director Tove Strand said that NORAD was not “satisfied” with the governments internal audits.
Strand added that she was “optimistic” that the government would address the situation and follow up on proposals that had been made.

An analyst in Maputo told IRIN on Wednesday: “Donors want external independent auditors to come in and assess the whole situation. They want someone who is not directly linked to the process and who has no stake in the outcome of the audits.”

Mozambique is the largest recipient of Norwegian aid in Africa.
In 1998 this amounted to an estimated US $50 million. Last year, 77 percent of Mozambique’s capital expenditure came from international aid with the government deficit standing at 20 percent of the gross domestic product before any aid was received.

The analyst said that the way in which Mozambique handled foreign aid was an important issue because “if the donors decided to cut off aid tomorrow, Mozambique would starve.”

Another analyst told IRIN that part of the concerns stemmed from 1995 when an estimated US $2 million of NORAD money that was destined for an agricultural programme was used to pay Mozambican companies for goods which the government never received. The Mozambican government was then forced to repay this money to NORAD.