Counting the Cost

The economic rise of Mozambique

Could the African nation be a bright spot on the fiscal horizon?

While most of the world seems on course for at least some degree of economic slowdown, there are some bright spots on the fiscal horizon – and Mozambique is one of them.

Despite a 15 year civil war, the country has seen a decade of growth averaging around seven per cent and most of that is thanks to massive infrastructure spending being used to develop the country’s rich coal reserves.

The first export in 20 years was made just a year ago, but Mozambique has grand ambitions to become the world’s biggest coal exporter within a decade.

And coal is not the only resource at the government’s disposal. If the recent discoveries of natural gas are confirmed, Mozambique will rank fourth in the world for natural gas reserves – behind Russia, Iran and Qatar.

The government is planning to spend $50bn over the next decade to tap those reserves, and to create thousands of new jobs.

So there is plenty of reason for optimism, but with the overall unemployment rate still at 27 per cent, many people are still waiting for evidence that the government can deliver. Tania Page reports from the capital, Maputo.

We also talk to Standard Bank Group’s chief executive Jacko Maree about Mozambique and the reasons for Africa’s economic rise.

La Liga’s economic woes

Meanwhile, in Europe, Spaniards have not had it easy this year – a burgeoning debt crisis and growing protests on its streets are symptomatic of a country drowning under economic woes as it grapples with the highest unemployment rates on the continent.

The economic downturn has affected everything Spanish, including their top football league, La Liga. Despite big stars and big money, there are also big debts, and unpaid taxes running into the billions.

The top division clubs have debts of more than $4.5bn, and almost a billion in unpaid taxes.

Although the league generates almost $800m in annual TV revenue, Spain’s broadcasters are struggling to turn their nation’s success on the field, into profitable business.

Plagued by delayed salary payments, banks not lending money, players taking up better offers abroad and threats of strike action – it all adds up to an uncertain future.

Even massive foreign investment does not seem to be enough.

Qatari investor Sheikh Abdullah al-Thani has pumped substantial sums into Malaga Football Club, and last year it achieved its best league position ever, but the league’s problems have even engulfed Malaga, and the Sheikh is now refusing to invest any more money in the club.

Matt Rumsey reports from Malaga, while Teymoor Nabili talks to Rodrigo Garcia, a lawyer at Laffer Abogados who represents a number of players at Real Madrid as well as some in the English premiership.


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Follow Kamahl Santamaria @KamahlAJE and business editor Abid Ali @abidoliverali