According to foreign media, Mozambique’s Confederation of Business Associations (CTA) has called on the government to avoid “at all costs” the closure of the Mozal aluminium smelter, on the outskirts of Maputo.
CTA chairperson Alvaro Massingue, cited by the German agency DW Africa, warned that there would be “severe social and economic consequences” from any closure of the smelter.
“It should be a common objective to avoid, at all costs, the closure of Mozal”, said Massingue. He feared that closure would have a knock-on effect, pushing dozens of other companies that supply Mozal into bankruptcy, with massive redundancies.
The key problem is that, like all aluminium smelters, Mozal’s main input is electricity. The contract under which Mozal purchases electricity expires in March, and it has so far proved impossible to negotiate a new contract.
It is reported that South32, the largest shareholder of Mozal, is willing to pay a maximum electricity price of 6.4¢ per kWh. But the Mozambican government points out that 6.7 cents per kWh is the minimum that should be charged to cover the costs of generating the 950 megawatts of power that Mozal uses.
