- Government will save half of natural gas revenues in its fund
- Plan calls for yearly independent audits, quarterly reporting
Mozambique published its proposed model for a sovereign wealth fund as it prepares to reap as much as $96 billion — more than six times the size of its current gross domestic product — from liquefied natural gas projects that companies including Total SE are building.
The developments, which are the biggest private investments yet in Africa, could make Mozambique the continent’s second-biggest producer of the fuel. The central bank laid out plans for how the fund may function and which institutions it will report to. The proposal anticipates that the $96 billion will accumulate over the lifetime of the projects.
The fund will build up savings and contribute to fiscal stability when commodity prices fluctuate, according to the document published on the Bank of Mozambique’s website on Monday. Lawmakers would regulate the fund with the Ministry of Economy and Finance managing it. The central bank will manage the fund’s operations and implement its investment policy.
The government will need to deal with escalating violence in the northern Cabo Delgado province where the projects are located before it enjoys the full benefits. Fighters linked to Islamic State in August seized the port town of Mocimboa da Praia — about 60 kilometers (37 miles) south of where Total is spending $20 billion on its project. It’s not clear when the state will regain control.