Is it too late for businesses in Cabo Delgado, Mozambique?

Updated: Apr 18

OPINION:


Insurgency has been sizzling in Mozambique's northern province since 2017. Sitting on Mozambique's northern border with Tanzania, Cabo Delgado is rich in natural resources but is one of the poorest provinces in Mozambique. It hosts what is apparently the biggest investment ever made in Sub Saharan Africa; a $60B LNG project led by Total with Eni and Exxon Mobil. Due to come on stream in 2023, this is possibly the largest LNG deposit in the world. Other resources close by include, granite, graphite and gemstones. Cabo Delgado, long neglected by the Government of Mozambique (is or) has become a Muslim enclave within an otherwise Christian country. It is characterised by high unemployment, poverty, poor food security and presents a cauldron within which insurrection can easily be stirred.


A hypothesis that this insurgency is local youths, possibly encouraged by Imams, simply trying to claim their 'entitlement', doesn't really stand up, at least without significant technical support. In fact by these terrorising actions, they actually stand to lose everything. They do not have the skills or wherewithal to exploit the natural resources onshore or offshore and are potentially scaring away the international companies required to recover the gas and operate the mines. Regrettably, corruption appears to have become custom and practice in Mozambique. It perhaps suits the Government of Mozambique to direct blame on outsiders instead of confronting the possibility that this is the consequence of their lack of attention. In failing this Province, the Government of Mozambique has failed to protect its greatest asset. It might suit other insurgents to claim credit for newsworthy events but links to groups such as Al Qaeda, ISIS and Al Shabab (in Somalia) are claimed but do not appear to have been proven. A smuggling network has existed along this coast for years and it is very possible that people and materials could have been (and possibly are still) being inserted from the sea. With substantial strategic assets involved, geopolitics could be under pinning activities - perhaps there's a plot for a James Bond movie here? However, somebody of means is providing the finance and motivation at least to seed strategy, recruitment, training, weapons and generally pulling the strings. The reality of the situation on the ground probably includes some or all of these elements.


It has been suggested that growth of the insurgency here can be likened to Boko Haram in Nigeria. Regardless of the 'development model', the insurgency does appear to becoming better resourced and organised. During attacks in 2017 most of the insurgents were reported to be armed with machetes and knives but recent attacks indicate uniforms, greater use of firearms, vehicles and heavier weapons, including mortars. From the outset, attacks have included indiscriminate killing of innocents including children, beheadings to terrorise the population (and perhaps cement the link, real or imagined, to an Islamic extremist group). These attacks are becoming progressively bolder and are spreading down the coast.


It is not appropriate nor intended to criticise companies, organisations or individuals here as the details remain unverified and require better clarity. The most recent attack at Palma on 24 March 2021 seems to represent a further development of the insurgents capability with improved communications, better coordination and focus. As a coastal town with a population of over 75,000, Palma is not small. It hosts Total' s LNG logistics hub, the project team and associated equipment. Estimates vary wildly but reports suggest that the attack was well coordinated and a combined force of between 100 - 1000 insurgents fell on the town simultaneously from three directions. Initially, targeted infrastructure included banks, the mobile phone network, businesses, hospitals and public buildings including schools. The insurgents had the confidence to remain within Pemba for several days before withdrawing. A desperate attempt to escape by Expatriates from the Amarula Hotel led to loss of lives when the convoy of about 17 vehicles was ambushed. Otherwise the same modus operandi was followed; burning houses, random killing and the beheading of victims continued to copycat or suggest connection with an islamic group. The subsequent flooding of the area with Mozambique defence forces was a classic case of 'too little, too late'.


Neighbouring countries such as South Africa, Zimbabwe and Malawi should be concerned about this insurgency spreading out of control and escalating, possibly with small cells breaking away to create impressions of scale, mischief and confusion further afield. Tanzania's southern border is protected by the Rovuma river but this does not really present a significant barrier, especially with a cross border ferry service towards the river mouth and Unity Bridge just a couple of hundred kilometres upriver at Lupilichi. Mtwara, just over the border and also on the coast could also present an attractive target; it is home to Tanzania's major offshore oil and gas assets.


It is understood that Mozambique has now formally requested assistance from the South Africa Development Community (SADC); it is likely to be agreed. Success won't come overnight and will hinge on the strategy, training and discipline of deployed troops whose actions and behaviour must rapidly win the hearts, minds and confidence of the local population. Notwithstanding cultural differences, effective communication with the population will be challenging; whilst the Portugese language is pretty widespread, local languages that are spoken are Swahili, Kimwani and Macua. If the SADC force acts as an aggressive 'blunt instrument', the situation could rapidly deteriorate. A robust, professional, consistent approach backed by community care packages may go along way to rebuilding confidence. Unfortunately SADC have some ground to recover here; the Mozambique Government retained the services of a Private Security Company called Dyck Advisory Group (DAG) to fight the insurgency. DAG have been accused of terrorising the communities they were charged to protect by dropping grenades and firing on civilians from helicopters.


The white sandy beaches, so popular with South African tourists, now lie empty and the 'tourist dollar' has disappeared. The associated humanitarian crisis continues to escalate. It is understood that some 500,000 refugees have been registered by support agencies since 2017 and thousands are thought to have taken to the bush where they are hiding, too afraid to return home. They are reported to be hungry, living on vegetables and rainwater. If estimates about the strength of the insurgency force at about 1000 strong are correct, then the impact of taking over 2m calories a day from the impoverished local population must also be taking its toll; its reasonable to assume that wildlife is being decimated for bushmeat.


So what does this mean for international businesses resident in and close to Capo Delgado? Many will be considering their positions and making plans to shut down operations and / or perhaps moving them solely under local control. Supporting contractors (especially independents) are likely to withdraw, at least temporarily, from Capo Delgado; this will have operational impacts on project delivery and critical construction skills, maintenance schedules and defect repair. Delays to commissioning and operational performance are very likely.


These incidents highlight the value and importance of:

  • Crisis management plans.

  • Site and country evacuation plans.

  • International safe travel management procedures.

  • Fully empowered local leadership supported by immediate access (24hrs a day) to executive management at corporate headquarters.

  • A comprehensive stakeholder management plan.

  • Strong Diplomatic and Government relationships.

  • Special risk insurance policies that should be reviewed in light of the increasing kidnap risk and potential hostage threat presented by site occupation.

At site:

  • The Environmental Social Governance (ESG) study and Sustainable Natural Resource Management Plan (SNRMP) should be reviewed (or developed).

  • Community engagement activity should be increased and development programs reviewed.

  • Security Risk Assessments need to be refreshed and physical security arrangements reviewed.

  • Properly equipped 'Grab Bags' including radio, satellite communications and tracking with food and equipment to sustain survival for up to 72 hrs in the bush should be available for staff.

  • Emergency response plans need to be reviewed and exercised.

  • Journey management procedures to be implemented.

  • Evacuation plans and associated resources need to be validated and maintained at immediate readiness.

  • Strong working relationships to be fostered with trusted contacts within the Provincial and National Governments, Police and Military. An understanding of their reliability, capability, intelligence and realistic response times are essential.

  • Relationships with national Embassies should be nurtured.

  • Mutual support networks should be developed with other companies and organisations in the region to share information, facilitate early warning and assistance if required.

Businesses should beware of simply taking a fortress mentality approach as insurgency can run riot just outside the perimeter and break through without warning. This is the time when investment in supporting the local community and having an active community network to facilitate feedback and early warning will pay dividends. Where this is not in place, urgent action is required now to safeguard people, assets and investment. There may be some obvious and immediate steps that can be taken to create conditions for local benefit and to ensure the business is planted as a truly valued member of the local community. Remember that the 'bucket of goodwill' fills one drip at a time and can be completely emptied with a single kick. Special attention should be given to reviewing social impacts, understanding dependencies, livelihoods and any community grievances. 'Low hanging fruit' might include agricultural schemes to provide employment, feed the workforce and improve community food security. The creation of agricultural cooperatives (Co-ops) with schemes to share machinery, fertilisers, seeds and access to markets. Offshore fishing and aquaculture projects. Community health schemes ensuring access to fresh potable water. In this context, Covid-19 presents an opportunity. Reinforcement of hospitals and clinics, health education, provision of PPE, hand washing facilities, Covid-19 testing regimes and vaccination programs could add real value to the safety of the workforce, their families and the local community. Implementation of course needs to be carefully designed to reduce the risk of companies becoming targets, but this is all 'doable'.


A coordinated multi organisation team effort is required to maximise immediate impact on the ground. There is an opportunity for industry to agree common objectives and coordinate this effort with other companies, governments, the SADC and NGO's.


So finally to conclude ...... No, its not too late, but don't hang about. Every days delay increases the risk and the solution becomes even more challenging and expensive to deliver. Mozambique could even 'miss the boat' on monetising this huge LNG asset; markets could disappear as the global rejection of carbon and fossil fuels gathers momentum. Cabo Delgado would remain impoverished and the local population would be living under the ongoing threat of extreme violence within a new 'Caliphate'. International investors could lose their appetite for this risk.