Yr ‘00 ‘01 ‘02 ‘03 ‘04 ‘05 ‘06 ‘07 ‘08 ‘09 ‘10 ‘11 ‘12
CR 1.3 1.4 1.6 1.8 2.0 2.1 2.3 2.5 4.0 3.2 7.1 12. 16.
8 1
• Risk Mitigation
– Project was structured in a way to ensure that an expropriation
would have international consequences
– International suppliers:- power from Eskom of South Africa,
alumina from Billiton’s Australian operations, raw materials
such as coke, petroleum etc would also be imported.
– Any expropriation will jeopardize its relationship with all these
countries
– Involvement of IFC, a member of the world bank group reduces
the risk of expropriation
– Expropriation will have impact on future flows from
development fund
Impact on the Economy
• Increase exports by $430 million
• Increase GDP by $157 million(by 9%)
• Increase net foreign exchange by $161million per year
• 5000 construction jobs and 873 permanent jobs
• Develop human capital through managerial, health and other skills
training
• Improve infrastructure and spur investment along Maputo corridor
• AIDS awareness program
• Additional housing
• Commercial ties with local businesses to bolster Mozambican
economy
• Due to the a large number of benefits to the economy , the
government would not act against the interest of the project
• Political Instability
• Risk of war: not completely eliminated
• Bureaucratic hurdles
• Underdeveloped infrastructure
IFC
Promotion of private Mitsubishi French Export
sector investments in Equity provider Credit Agency
developing countries and will share the Supporting the use
as a way to reduce output (large metal of Pechiney
poverty and improve group) technology
people’s lives
Objectives of IFC